The European short time work programme “SURE”

The “SURE” instrument of the European Union provides temporary financial assistance to Member States; its goal is to protect jobs that are jeopardised by the pandemic and, thus, employees. To this end, the European Union will provide up to EUR 100 billion to Member States through EU loans. These funds are then to be used to finance public expenditures incurred directly in connection with short time work schemes and similar measures for the self-employed. The European Union will finance these loans by borrowing on the capital markets.

The financial assistance will be granted upon request from the respective Member State. The Commission will determine the extent to which public expenditure in the Member State concerned will increase as a result of short time work and similar measures for the self-employed. The terms of a loan will then be established based on these determinations.

The COVID-19 pandemic has been referred to as one of the greatest challenges for European countries since the end of World War II. But in addition to concerns about the population’s health, which was initially the primary focus of attention, the significant economic consequences of the crisis, which also affect job markets, have become increasingly more noticeable. In this context, also the Member States of the EU are faced with job losses. Crisis response strategies pursued by the Member States at a purely national level can only address this problem to a limited extent.

Council Regulation (EU) 2020/672 of 19 May 2020 aims at providing support to those Member States that are particularly affected by the negative economic and social consequences. “SURE” provides a possible way to grant and obtain financial assistance; its purpose is to help Member States mitigate, in particular, the negative consequences for the labour market. In this manner, jobs are to be protected and the risk of unemployment and loss of income is to be reduced.

The “SURE” help package benefits firms affected by the pandemic and their employees and aims at mitigating the risk of unemployment. The idea behind the programme is to enable firms to retain skilled staff that will most probably be needed again sooner or later when the crisis is over.

Especially undertakings with an international structure could benefit from the programme if they are able to have recourse to the instrument of short time work across Europe.

The “SURE” instrument will initially be available to the Member States up until 31 December 2022.

Its availability can be extended for another six months at a time upon a proposal from the Commission.

It remains to be seen whether the “SURE” instrument can achieve the intended purpose of preventing the loss of jobs or whether restructurings and staff cuts will be inevitable in the intermediate term. As for staff cuts during short time work, see here for further information.