The Government’s New Support Fund and Allowance for Those Ordered to Take Leave

The Ministry of Health, Labour and Welfare (MHLW) has launched a new allowance support program for employees who are/were on leave from work as ordered by their employers due to the circumstances of the COVID-19 outbreak. The program is based on a special act on the Employment Insurance Law that came into effect on June 12, 2020 (Act No. 54 (2020)). The call for applications began on July 10, 2020.

As announced earlier, employers may apply for an employment adjustment subsidy to assist in paying allowance to employees who were ordered to take a leave from work.

However, the new allowance support program is designed to directly help employees of small- to mid-sized enterprises (“SMEs”) who have not received the abovementioned allowance. Just as with the employment adjustment subsidy, part-time workers, including students, are eligible to receive allowance from this program (but it excludes those who have already received the employment adjustment subsidy).

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Program overview

The program aims to financially support employees of SMEs who were ordered by their employers to take a leave from work and have not yet received allowance, and to help prevent them from becoming unemployed. Applications must be made by the employees themselves.

Individuals who meet all of the conditions, including the two below, will receive an amount equivalent to 80% of the wages they had been paid before the leave (a maximum of JPY 11,000 per day, depending on the individual’s case).

(1) Employees of SMEs ordered to take a leave by their employers during the period of April 1 to September 30, 2020.

(2) Those who fulfill the above (1) and have not yet received allowance for their leave.

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References

- General information and updates on the program (MHLW website, Japanese only)

https://www.mhlw.go.jp/stf/kyugyoshienkin.html

- Overview of the program (MHLW website, Japanese only)

https://www.mhlw.go.jp/content/11600000/000646900.pdf

- For employees and employers (MHLW website, English)

https://www.mhlw.go.jp/content/11600000/000648770.pdf

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For further details, please contact the ministry’s designated call center for the leave allowance program at: 0120-221-276 (toll free, Monday to Friday: 08:30-20:00, weekends and holidays: 08:30-20:30)

Update : August 7, 2020