The dilemma being faced by thousands of troubled employers across Greece is whether to dismiss employees or suspend their labor contracts instead, as the government is proposing.
Many companies that are not included in the forced closure measures introduced by the government and are still able to operate, have the right to suspend the contracts of some or all their workers if they see their turnover slump as a result of the economic slowdown caused by the coronavirus pandemic.
In that event, firm will be temporarily relieved of social security contributions, both of the employer and the employee, and the obligatory payment of salaries, while workers will maintain all of their social security rights and the ability to collect the extraordinary handout of 800 euros each. Crucially, in the case that employers take up the option of suspending their workers’ contracts for a month (with a possible extension) they will also undertake the obligation of not carrying out any layoffs, as they will be deemed invalid.
The right to suspend contracts does not apply to all enterprises still operating, but only to those whose main activity is on the recent list issued by the government.