Holiday Vouchers – back to the past?
With effect from 1 January 2019, the Slovak Parliament has approved an amendment to the Labour Code introducing a recreation allowance publicly known as a ‘holiday voucher’. This amendment is aimed at supporting tourism in Slovakia by providing an allowance for employees who spend at least two nights at an accommodation facility in Slovakia, with catering and other expenses potentially covered.
This obligation only applies to employers with more than 49 employees (for others it is optional) and to employees who have worked for the employer for more than two years on the day their holiday begins. The amount of the contribution is set at 55% of the employee’s eligible expenses, up to a maximum of EUR 275 per year.
For the employee, the allowance will not be considered taxable income and is not subject to social security contribution. For the employer, the allowance will be considered a tax-deductible expense.
Comment
At the beginning of 2019, it is not possible to predict how will such changes affect the employment environment for employers and how seriously it will affect their financial situation. This is, however, another level of regulation in an already quite strictly regulated Labour environment and an additional cost for employers. Moreover, these types of holiday vouchers existed some 40-50 years ago, this change may be seen as a step back from developing a ‘modern’ EU society.
Increase in allowances for weekend, night and holiday work takes full effect
From 1 May 2019, an adopted amendment effective from 1 May 2018 comes into full force. In the first year, allowances for weekend work, night work and holiday work were only increased by half: from 1 May 2019, the changes will come into full force.
This amendment imposes an obligation on employers to provide employees with an additional payment of 50% of the minimum wage per hour for work on Saturdays and 100% for work on Sundays.
Allowances for night work will increase to 40% of the minimum wage per hour and to 100% of the employee’s average earnings for work on a public holiday.
Employment of foreign nationals
A change that took effect on 1 January 2019 is aimed at helping the employment environment in occupations where there is a shortage of workers in Slovakia.
It shortens the deadlines for assessing applications for permits allowing seasonal employment and extends the possibilities for employment through temporary employment agencies, however, it only applies in occupations with a shortage of workers. The list of these positions will be regularly updated and published by the Central Office of Labour, Social Affairs and Family (on its website), by the end of the month immediately following the relevant calendar quarter and will reflect market needs.
Proposed Sport Vouchers – a possible continuation of the “social” environment?
At the beginning of January, a proposal to introduce sport vouchers was announced, with the aim of increasing interest in and availability of sport activities for children. The aim is to implement the same or a very similar scheme to holiday vouchers (described above), that is, parents will pay EUR 225 and the employer will have the opportunity to contribute EUR 275.
It is proposed that this contribution should be exempt from taxes and social contributions. In contrast to holiday vouchers, sport vouchers should not be obligatory for employers.
This proposal was only published in the media and announced by the department of Slovak Ministry of Education, Science and Sport, however, and its future is uncertain.
