State to provide financial protection for employees with labor contract

In these difficult days of the COVID-19 pandemic, many people in social isolation are waiting for support from governent.

On March 19, President of Azerbaijan Ilham Aliyev issued a decree on the creation of a working group setting it a task of eliminating possible impacts on the stability of the economy, protecting the social welfare of the population, and ensuring the sustainability of our country's economic development. 

Ten days later, economy Minister Mikail Jabbarov, who headed the working group, presented an essential document containing the main directions for minimizing the negative consequences of the impact of the coronavirus pandemic (COVID-19) on the economy.

The report consists of 10 programs to provide state support to various sectors of the economy and business.

The document makes it evident that the main thread traced in all ten programs is the prevention of job cuts and financial support for citizens. It means that the population should not panic and calmly observe the quarantine measures, and do not leave the house without the urgent need.

The first and most comprehensive program out of 10 refers to financial support for the compensation of wages of employees in the areas that suffered most from the coronavirus pandemic. According to estimates, the study revealed 11 sectors 100% affected by the ongoing negative processes. The document includes the field of catering, trade, tourism, services, transport, and other sectors.

It is essential to include in this program every citizen who has an employment contract and transparently works in these mentioned sectors so that they would be financially protected by the state. This program covers 44,000 enterprises with 304,000 employees, and the state will pay a significant portion of salaries. The current situation shows again that having a labor contract is very important.

Notably, at present, 1,555,000 people in the country work based on employment contracts. 915,000 of those are working in the public and oil sectors, while the remaining 640,000 employed in private and nonoil sectors. Thus, the 304,000 employees covered by the program account for more than 45 percent of those engaged in these sectors.

Forty-five percent is by no means a lot, and not every state is ready to take on such a financial burden. Still, our government has repeatedly demonstrated its intentions and steps to take care of its citizens, thanks to the successful economic and social policies implemented in Azerbaijan in recent years.

As document notes, the mechanism for applying the program will be based either on the real salary of the employee or the average monthly wage in the country. Notably, in January, the average monthly salary was 712 AZN in Azerbaijan. The program proposed to allocate 50% of the monthly salary fund in the form of direct financing to entrepreneurs and businesses.

However, entrepreneurs should not relax. As President Ilham Aliyev said, a lot depends on entrepreneurs: "We have made all the necessary decisions, made and will make all the necessary amendments to the legislation. So today, entrepreneurs must work by our common cause, in this case, we will be able to come out of this difficult test with honor".