Here you will find all key employment, tax and operational measures relating to COVID - 19 in Latvia.
Tax measures (deferrals, reductions):
- Taxpayer in the crisis-affected sectors is entitled to apply for the extension of the tax payment term.
- The tax administration has the right to defer or delay the payment of late tax payments for up to three years from the date of submission of the application.
- The Cabinet of Ministers will define the sectors facing considerable deterioration in their financial situation amid the spread of COVID-19 (crisis-affected sectors) and which thus qualify for the application of measures and special support mechanisms. The Cabinet of Ministers can review and supplement the list of the crisis-affected sectors.
- The tax administration, when taking tax administration measures, performs the overpaid VAT amount refund within a shorter term than the one provided by the effective VAT Law, thus raising available funds for overcoming the crisis caused by the COVID-19 virus.
Social Security measures (deferrals, reductions):
- Idle stand support has been approved by the government for the industries affected by the state of emergency. If the employer cannot provide fulfilment of the work duties to the employee or the employer is on idle time, in the order and amount determined by the Cabinet of Ministers (not prepared, yet) remuneration of the employee will be compensated by the state in the amount of up to 75% from the average remuneration for the previous six months, but not more than EUR 700 per calendar month. In such case, the employers are not obligated to distribute to the employee the remaining amount due to employee according to the Labour Law. PIT and mandatory state social insurance contributions shall not apply to the idle stand support. Detailed procedures on how to apply and get the compensation have not been approved yet.
Grants and access to finance:
- The possibility is provided for increasing reserve capital for the State Development Finance Institution Altum, allowing entrepreneurs to use the support mechanisms - loan guarantees, as well as loans for crisis resolution.
- If an employee is sick (has symptoms), or has come into direct contact with the COVID-19 infected person and has been recognized as contact person (for a 14 day self-isolation period), or to take care of a sick child or if a child has come into direct contact with the COVID-19 infected person a doctor can issue the sick leave certificate.
- If the employee has visited any of the coronavirus disease-affected areas with a child under 14 years, the health institution may issue to one of the parents a sick-leave certificate B (paid by the government) for 14 days period to observe health condition of the child.
- Sick leave certificates are not issued for people returning from abroad and are therefore obliged to self-isolate, but who are healthy.
Enforced leave/use of holiday (paid vs unpaid):
- Employer can encourage, but cannot force employees to use unpaid leave.
- Parties can only mutually agree on such unpaid leave, additional or annual paid leave or other similar temporary changes during “forced idle time”.
- There is no such notion as “temporary lay-offs” in Latvia Labour law. Parties are allowed to mutually agree on similar temporary measures in the undertaking, however, such measures cannot be imposed by the employer unilaterally.
- In case of idle time, the employer has the right to unilaterally assign an employee the performance of work not provided for by an employment contract for a period not exceeding two months within one year.
Reduction in pay and/or hours:
- Latvian Labour law does not allow the employer to unilaterally reduce pay or hours.
- If the employer is forced to shut down its operations and therefore does not provide work to an employee (idle time), even if such decision would be made by the Latvian government, employee's obligations shall be deemed to be fulfilled and the employer has the obligation to disburse the remuneration in full amount. If a time salary has been specified for an employee shall receive the remuneration specified in the employment contract, if a piecework salary has been specified – such employee shall receive average earnings.
- Parties are allowed to agree mutually agree on a part-time work.
- If it is clear that the situation in the undertaking will not improve and the employer is not able to provide work, redundancy is an option. Redundancy is an extraordinary termination of the employment contract by the employer due to economic reasons, i.e. if following the agreed work conditions is impossible because of a reduced amount of work or the rearrangement of work. Redundancy also happens, when the employer terminates its operation or files for bankruptcy.
- Employers must follow a redundancy procedure which includes an obligation to offer another job, if possible; to pay severance payments in amount of at least 1 - 4 month average earnings (depending on seniority) or a higher amount if provided by the employment contract or collective agreement. As well to pay compensation for unused vacations.
- A termination notice 1 month in advice would be required, and during this notice period employer would be obligated to pay salary.
- In the case of collective redundancy, additional notification and consultation requirements apply, incl. obligation to notify the governmental authority.
- In addition, employees may be entitled to statutory unemployment insurance benefits.
- An employer cannot terminate employment contracts during the following periods: (i) a period of temporary incapacity; (ii) a period of leave; (iii) a period while work is not performed due to other justifiable reasons. The Employer is prohibited to give a notice of termination without the prior consent of the relevant trade union if the employee is a member of the relevant trade union for at least 6 months.
- The government has recommended employers to encourage employees to work at home wherever possible. To facilitate this, employers should provide employees with the necessary work equipment or employee shall be paid compensation for the use of personal means.
- Employees shall comply with occupational health and safety requirements even when working at home.
- Remote work should be paid on a regular basis.
Travel (business and personal):
- The government has strongly advised against all non-essential travel worldwide.
- There are restrictions on entering and leaving the Republic of Latvia.
- For the time being, there is no restriction on movement within the country.
- Everybody who does not fall under any exemptions must remain at home or at their place of stay for 14 calendar days when entering Latvia (obligation to self-isolate). This does not automatically mean that the employee is not required to work during the isolation. The employee must inform the employer and agree on a new arrangement of work. The suggested solution is to enable the employee to work remotely from home. If this is not possible, both sides must reach an alternative agreement, e.g. agreement on unpaid or paid leave.
- If employees cannot travel abroad as planned, it is likely that they will request a cancellation of booked annual leave. Employers are not obliged to allow employees to cancel leave, but should consider whether this would be appropriate in the circumstances
Preventive actions (reception policy, public interactions, management of infected employees):
- According to the applicable laws and recommendations, each employer should:
- inform the employees about the situation of the COVID-19 in Latvia and to make recommendations to employees regarding personal hygiene and preventive measures;
- issue, required under circumstances, personal preventive measures (disinfectants, masks, etc.);
- approve an action plan for managing the situation at the workplace.
- If there is suspicion that certain employee’s health status threatens the health of other employees, an employer must offer such employee working from home or order (in written form) him/her to undergo a health examination. In the case of the employee’s refusal, the employer should suspend the employee from work without payment of salary.
Employees with children or older dependents:
- An employee has the right to the temporary absence if his or her immediate presence at work is not possible due to force majeure, an unexpected event or other exceptional circumstances. However, there is no regulation explaining what period of time should be considered as temporary.
- An employer shall determine part-time work if it is requested by a pregnant woman, a woman during the period following childbirth up to one year, but if the woman is breastfeeding - in the whole period of breastfeeding, as well as by an employee who has a child in the age of up to 14 years or a child with a disability in the age of up to 18 years. Therefore employees with children under 14 years can request to work part-time work.