Part-Time Unemployment Benefits Extended

The Icelandic government has just announced the next phase of its stimulus package at a press conference. The main points of the package are as follows:

The government will extend through June its program of covering up to 75 percent of the pay of employees whose job ratio has been reduced. The program had been set to expire June 1.  After the end of June, the government will cover up to 50 percent of their salary through August.

Simpler rules on financial restructuring of companies will be temporarily enacted. The process of seeking protection for companies will be simplified while an assessment is made of their position, and until the outlook for the future is clarified.

Companies that have seen their revenue reduced by at least 75 percent and foresee losses through this year will be able to apply for state funding to cover part of employees’ pay during the three-month notice period. The maximum state funding will amount to ISK 633,000 per month.

A quarter of Icelandic companies are anticipated to be eligible for this support. Government support will be capped at a ratio of 85 percent. These employees will have priority access to jobs when business activities resume and will retain certain specified accrued rights from their employer. This government support will be available from May 1 through September 30.

For more detailed information, see here.