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When do I have to pay back the wage subsidy?

Prindi

Lisatud 20.12.2016

An employer shall return a wage subsidy in full if the employment relationship is terminated on the initiative of the employer earlier than one year after entry into the employment contract or the employment relationship with a term shorter than one year is prematurely terminated on the initiative of the employer.

With regard to the "My first job" service, the employer has to repay the wage subsidy in full if the employment contract is terminated on the initiative of the employer during the following two years.

In the case of people with decreased working ability, the employer has to repay the wage subsidy in full if the employment contract is terminated on the initiative of the employer within two years of entry into the employment contract, or a six-month employment contract is terminated on the initiative of the employer before the deadline.

An employer shall return a wage subsidy in full if the employment contract is terminated on the initiative of the employer, except on the basis of § 88 of the Employment Contracts Act (cancellation of employment contract by employer for reason arising from employee).  The employer has to repay the wage subsidy when e.g. the employment contract is terminated due to redundancy, or on the initiative of the employer due to unsatisfactory results during probationary period under § 86 of the Employment Contracts Act. The wage subsidy does not need to be paid back if the employment contract is terminated on the initiative of the employee or by agreement between the parties.

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