Almost 3,000 people to lose work as 14 companies announce collective redundancies

  • 2020-03-24
  • LETA/TBT Staff

RIGA - Due to the Covid-19 pandemic, 14 companies in Latvia have announced collective redundancies, which will result in almost 3,000 employees being laid off, Welfare Minister Ramona Petravica (KPV LV) said in a press conference today.

The minister underscored that it is hard to predict how the number of unemployed will grow due to the pandemic.

She said that NVA so far has received information from 14 companies about collective redundancies that will affect 2,884 employees.

The minister said that the number of jobless people in Latvia has risen by 1,200 people since early March.

The collective redundancies have been announced by businesses working in transport and warehousing, the hospitality and food services sector, as well as the gambling sector.

Petravica said that employers should carefully assess a possibility to keep employees and consider support opportunities offered by the state in the sectors affected by the coronavirus crisis.

The minister said that one of the companies that announced lay offs was airBaltic. The airline reported that it does not see it possible to resume flights at the same amount as they were before the state of emergency any time soon, therefore the company's management does not see it correct to pay employees for idle time if they will have to be fired in any  way after the crisis.

Finace Minister Janis Reirs (New Unity) reported earlier that the state support to be allocated to deal with the consequences from the crisis will amount to more than EUR 2 billion.

As reported, the Cabinet last Thursday endorsed the Finance Ministry's bill on measures for overcoming the crisis caused by the coronavirus Covid-19, which encompasses a comprehensive set of state support measures, including benefits that will be paid to employees laid off by companies.

The legislation stipulates that for businesses that are forced into idling due to the coronavirus pandemic - in the sectors that suffering the most from the Covid-19 crisis, employees will be paid 75 percent of their wages from the state budget, with the maximum monthly payment per employee set at EUR 700. These payments from the state budget will not be applied personal income tax and social contributions.