In recent days, we have encountered many questions regarding lay-offs in small, privately held companies. Over the past week, various interpretations of this matter have emerged. The authority designated to manage the payments of short-term lay-off compensation is Tillväxtverket (the Swedish Agency for Economic and Regional Growth). In this article, we comment on and clarify Tillväxtverket's statements.
Can a shareholder of a limited company be furloughed if they meet the other requirements?
Employees belonging to the employer's family are not eligible for support according to Section 11 of the Act (2013:948) on support for short-term work.
The Swedish Agency for Economic and Regional Growth interprets that employers who can be considered to have a family are sole traders as only they are natural persons. The interpretation means that employee owners and employees belonging to their family can also be covered, with the exception of the sole trader business form (however, other employees in the sole trader may still be covered). A prerequisite is, of course, that the other criteria for support are met.
So you can also receive support if you are the owner and sole employee in a business form other than a sole proprietorship, according to the current interpretation.
Can companies that have made or are making dividend payments be eligible for the support?
According to Growth Agency itself: ”The Swedish Agency for Economic and Regional Growth is of the opinion that it is inappropriate for companies to make large dividend payments while simultaneously receiving state support for short-term work. If we see that a company that has received the support acts in a way that shows it is not in a difficult economic situation, we have the option to regulate the support during the reconciliation that takes place after the support has been granted.”
This therefore means that if a dividend is paid during 2020, it can result in short-term lay-off support being reclaimed.
If you have questions about the above, please do not hesitate to contact your Moore contact person or your local Moore office.
