The European Commission has approved a €95 million Austrian wage subsidy scheme to support companies affected by the coronavirus outbreak. The scheme was approved under the Temporary Framework. The public support will take the form of a one-time bonus to help employers cover part of the costs related to holiday entitlements that their employees acquired during short-time work programs (so called “Kurzarbeit”). The measure will be open to companies active in certain sectors that were particularly affected by the restrictive measures that the Austrian government had to implement to limit the spread of the virus, such as the hospitality sector. The aim of the measure is to preserve the jobs of employees, who, due to the coronavirus outbreak, would have otherwise been laid off, and to allow companies to resume their activities immediately after the lockdown period. The Commission found that the scheme is in line with the conditions set out in the Temporary Framework. In particular, (i) the measure will finance part of the wage costs for employees who would otherwise have been laid off; (ii) the aid will not exceed 80% of the monthly gross salary of the benefitting personnel; and (iii) the aid will be granted no later than 31 December 2021. The Commission concluded that the measure is necessary, appropriate and proportionate to remedy a serious disturbance in the economy of a Member State, in line with Article 107(3)(b) TFEU and the conditions set out in the Temporary Framework. On this basis, the Commission has approved the measure under EU State aid rules. More information on the Temporary Framework and other actions taken by the Commission to address the economic impact of the coronavirus pandemic can be found here. The non-confidential version of the decision will be made available under the case number SA.62569 in the State Aid public case register on the Commission’s competition website once any confidentiality issues have been resolved.
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