Blog Payment of Salaries During Idle Time

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Payment of Salaries During Idle Time

463 / 2020-04-08 / KMG

Immediately after the declaration of a state of emergency in the Republic of Armenia on March 16, 2020, the question arose on whether to pay a salary during the idle time or not.

Lack of definite and precise answer to this question led to misinterpretation of the situation. It was obvious that the solution could be found through acting laws and legal regulations. Thus, Part 1 of Article 186 of the Labor Code of the Republic of Armenia stipulates that an employee must be paid a 2/3 of an average hourly wage (as it was before idle time) but not less than the minimum hourly rate. However, idle time caused by no fault of the employee does not necessarily mean that it was caused by the fault of the employer, therefore the employer is not obliged to pay for such idle time. At this point, Part 6 of Article 186 of the Labor Code of the Republic of Armenia should be taken into consideration, according to which salary is not paid for idle time caused by reasons considered as force majeure as defined by the Republic of Armenia law.

Since the declaration of a state of emergency was due to prevention of the spread of COVID-19 epidemic, the latter is in fact characterized by an occurrence of a force majeure. As the current legislation of the Republic of Armenia does not define the term force majeure by any legal act, it is necessary to consider the issue in substance, interpreting it as follows: an employee who has not been able to properly perform their duties under the employment contract due to force majeure shall not be paid, while the employee that has performed their job responsibilities in-site or remotely, with no objections from employer, should be paid.

Thus, due to the current situation and the urgency of the issue the competent authorities should provide official clarification that will specify the sectors of the economy affected by force majeure due to the state of emergency, and how labor relations with employees in these sectors shall be regulated in terms of salary payments.