Government support for business and workers in North Macedonia

1. What government schemes are available in your country to help employers and workers in the current COVID-19 crisis and for how long?

During the declared state of emergency in North Macedonia (“State of Emergency”), no scheme or measures (e.g. furlough, solidarity agreement, etc.) has been introduced to date. However, the government has introduced the following economic measures that support the employers during this State of Emergency:

  1. Funding Social Security Contributions (SSC) for employees; and
  2. Financial support for employees’ salaries.

2. What payments are made under the schemes and by whom?

For the measure under item i), the Government will fund the payment of SSC for April, May and June 2020. Namely, the employer can obtain a subsidy for each employee for April, May and June 2020 that funds 50% of the calculated SSC. The maximum subsidy amount is 50% of the SSC for the average gross salary of an employee in R. N. Macedonia according to National Statistics Office information published in January 2020 (“Subsidies”).

For the measure under item ii), employers can apply for financial support up to MKD 14,500 (approx. EUR 235) monthly per employee for April and May 2020 (“Support”) in line with the registered working time of the employee. Working time resulting in compensation that is not paid by the employer will not be considered as the employee's registered working time.

3. Which employers and workers are covered?

For the measure under item i), employers are covered if they are impacted by COVID-19 and fulfill the following conditions:

  • Monthly revenue for April, May or June 2020 have decreased by more than 30%, compared to the average monthly revenue generated in 2019.
  • Employers incorporated after March 2019 must experience a decrease in their monthly revenue for April, May or June 2020 by at least 30%, compared to the average monthly revenue generated from the day of incorporation in 2019 and the months January and February 2020.
  • For employers whose business has a seasonal character, the decrease in the average revenue for the last seasonal period of four months should decrease by more than 30%, compared to the revenue earned during the same four months of the previous year.
  • The number of employees (including the number of employees engaged through temporary employment agencies) who apply for this measure should not be fewer in April, May and June 2020 than on 31 March 2020, except for cases of retirement or death.
  •  The employer should not pay dividends to shareholders and bonuses to members of managerial or supervisory bodies or employees after 6 April 2020 (when this measure entered into force) until the day the annual account or financial statements for 2020 is submitted.

For the measure under item ii), the employer should fulfill the following conditions:

  • The total income of the employer in April or in May 2020 must decrease by more than 30% of the comparative average monthly revenue in 2019.
  • For employers established after March 2019, the total revenue for April or May 2020 must be at least 30% lower than the average monthly revenue generated from the day of establishment in 2019 and in January and February 2020.
  • For the seasonal employer, revenue for the four-month season in 2020 should be at least 30% lower than the comparative period in 2019.
  • The employer should not pay dividends to shareholders and bonuses to members of managerial or supervisory bodies or employees from 7 April 2020 until the salary payment for May 2020.
  • A maximum of 10% of the total number of individual employees must have an individual monthly net salary of over MKD 120,000 (approx. EUR 1,950) per month for the month financial support is required.
  • An employer that pays more than 10% of its total number of employees an individual net salary that is higher than MKD 120,000 (approx. EUR 1,950) for the month for which financial support is required does not meet the requirements of this item.

4. What procedures must an employer follow to take advantage of these schemes?

For the measure under item i), the employer should submit a BS-PZSO form for Subsidies to the Public Revenue Office (“Request”). The submission of the Request should be performed through the E-tax system of the Public Revenue Office (“PRO”). The PRO should confirm that the Request was received within five days from the day of its receipt.

Furthermore, the PRO provides the Ministry of Labour and Social Policy of N. Macedonia (“MLSP”) with information on the approved Subsidies no later than the 20th day of the month for the previous month. The Subsidies are paid by the MLSP no later than 10 days after receipt of the information.

For the measure under item ii), the employer should submit a formal request for the payment of employee’s salaries to the PRO (“Support Request”). The Support Request should be submitted through the e-tax system of the PRO until the 5th of the month for the previous month, which should be confirmed by the PRO within three days from the day of its receipt. The PRO should inform the employer for the total amount of Support that will be paid for the respective month. The amount of Support is to be paid by the 13th day of the month for the previous month.

5. Are there any other important eligibility criteria?

The employer will not be eligible to use Support under item ii) in the following cases:

  • For employees who in December 2019, January and February 2020 earned a net salary higher than MKD 39,900 (approx. EUR 650) for each month separately, in proportion to the reported working hours.
  • Uses the exemption from paying personal income tax and compulsory social security contributions.
  • Employees who perform additional work in accordance with labour legislation.

6. Are employees covered by the schemes protected from dismissal?

No, the temporary schemes do not contain any specific provisions protecting employees from being dismissed. An employer may terminate an employment agreement in accordance with labour law. However, the Government has unofficially encouraged employees not to sign settlements on termination during the State of Emergency.