The president signed a law bill which introduces a contribution during the ordered quarantine. This contribution is supposed to bring a bigger willingness of people tested positive for COVID to report their acquaintances with whom they have been in contact. According to the explanatory memorandum, people do not want to report their contacts precisely because their income would be reduced during the ordered quarantine.
Quarantine also means isolation. Thus, not only potentially infected people, but also those who have been positive-tested will be entitled to the contribution.
The contribution is in the amount of CZK 370 for each calendar day of quarantine, but it will be paid no longer than for the first 14 calendar days. The sum of the standard sickness compensation (quarantine) and this new contribution may not exceed 90% of the average gross earnings.
Because the ratio between gross and net wage corresponds to about 90% only for the minimum wage and the percentage decreases with increasing wage, it may happen that the income of people in quarantine will be even higher than in the case of work performance. According to calculations, a break occurs at a gross monthly wage of approximately CZK 52,250, assuming that the average hourly earnings correspond to this wage and the quarantine lasts exactly 14 days at 40 hours a week of working time. Up to this amount (CZK 52,250), the net wage in the case of quarantine is higher than in the case of work performance, while from this amount upwards, work performance is already becoming more profitable.
Specifics of the contribution from the point of view of payroll
The contribution is exempt from tax and thus from health and social insurance.
Employees are not entitled to the allowance if the doctor ordered a quarantine within 5 days of returning from abroad, unless it was a business trip. The employer should know the employee was abroad, as employees are obliged to report their trip abroad. However, this obligation does not apply to low-risk countries. The question is therefore how the employee will prove that s/he has not been abroad when there’s no obligation to report a trip to these countries.
The employer deducts from the social security payment the amount of the contribution. Therefore, the contribution should be paid from our taxes.
If payroll accountant needs to determine net income, the contribution is not taken into account. The contribution cannot be affected by the enforcement order or execution.
The law also includes information that the Czech Social Security Office (CSSO) will have to provide to the employer, upon request, information on whether quarantine or isolation had been ordered. This is very important, because in practice the employer only knows about the quarantine, which the doctor marks in a sick note by putting “quarantine” into the employee’s profession. However, this rule no longer applies to isolation, and since the employer does not see a diagnosis of a sick note, he is not even able to distinguish on his own whether it is an ordered isolation or not. Let us therefore hope that the communication between the employer and the CSSO will work as it should in this area.