Nicolau Lobato Presidential Palace, Dili, 16 July 2020
On 15 July, President Francisco Guterres Lú Olo promulgated the first amendment to the decree-law on employment support measures in response to the COVID-19 pandemic.
This promulgation follows the Council of Ministers’ approval of the first amendment to decree-law no. 16/2020, of 30 April — specifically to articles 14 and 16.
Article 14 concerns payments related to the aid set forth in articles 8 and 11 of that same decree-law, which are carried out by the ‘National Social Security Institute as extra-budgetary treasury operations and, for all accounting and budgetary purposes’, are recorded as expenditures in the accounts of the entity responsible for their financing. Article 16 has also been amended to specify that this aid applies to ‘employment contracts that were suspended or whose normal working periods were reduced’ in the months of March, April, May, and June 2020, as well as to the contributions relating to those same months.
In response to the impact of the COVID-19 pandemic, the government decided to financially support Timorese citizens whose employment has been affected.
The decree-law was approved by the Council of Ministers to address the negative impact of COVID-19 on the labour market and enables the State to provide extraordinary and temporary support to employers and workers in the private sector.
This financial support to employment within the scope of the government’s COVID-19 response is intended to address the ‘reduction of income for workers and the financial difficulties experienced by employers’. With it, the government wants to ensure the ‘maintenance of jobs’.
On the basis of this decree-law, the government — through the National Social Security Institute — will pay workers enrolled in the social security contribution scheme a subsidy equivalent to 60% of their salary as a measure to support employment amid the COVID-19 pandemic.