Covid compensation: what applied during the pandemic and what rights you have today

What was possible to ask for during the pandemic

When the government declared a state of emergency and took emergency measures in 2020, these were public interventions with a direct impact on citizens and businesses. The legal basis for compensation was the Crisis Act at the time, specifically Section 36, which held the state liable for damage caused by crisis measures.

However, the situation changed in the spring of 2021. From 27 February 2021, the Pandemic Act came into force, which introduced a new legal regime of a so-called pandemic emergency. This allowed emergency measures to be issued even without a state of emergency and also contained its own rules for compensation.

Thus, there were two different compensation regimes during the pandemic:

• under the Crisis Act, if the damage was caused by a crisis measure issued under a state of emergency,
• under Section 9 of the Pandemic Act, if the damage was caused by an emergency measure during a pandemic emergency.
  While the Crisis Act allowed claims not only for actual damage but also for lost profits, the Pandemic Act was considerably stricter. It only awarded compensation for actual damages, not for lost profits, and also imposed an obligation on the victims to minimise the damage. Compensation also included aid, subsidies or compensation programmes already provided.

What was claimable in the worst times associated with covid?

• Compensation for damage to property (e.g., business closed, stock destroyed, costs incurred).
• Compensation for lost profits – businesses could claim the difference between actual sales and what they would have earned without the cap.
• Compensation for harm caused to employees, e.g. if they were prohibited from working.
• Both entrepreneurs and natural persons who suffered harm as a direct result of the crisis measure were eligible.

However, the claims were not automatic. Three conditions had to be met:

1. The existence of a crisis measure (e.g. closure of establishments, restriction of movement of persons, prohibition of cultural events).
2. The occurrence of damage (property, financial, loss of profit).
3. A causal link between the measure and the damage.

At the same time, a six-month time limit for claiming compensation applies. For the Pandemic Act, the time limits were set differently, in particular with a longer subjective time limit for making a claim. If the injured party did not file a claim within 6 months of becoming aware of the damage (and no later than 5 years after the damage occurred), the right was generally extinguished.This ended up happening to a large number of entrepreneurs who filed claims late or not at all – often because the state communicated its obligations unclearly and did not pay compensation automatically.

Are claims for compensation for covid still valid today?

The question of whether it is still possible to claim compensation for covid today has no simple answer. Yes, claims from the past have not automatically lapsed, but new claims do not usually arise. The decisive factor is when and on the basis of what legal provision the damage occurred. Compensation could only be claimed if the damage was caused by an emergency measure issued during a state of emergency or an emergency measure issued during a pandemic alert under the Pandemic Act.

The state of pandemic alert ended on 5 May 2022. It is also important to add that a substantial part of the Pandemic Act (provisions of § 1 to § 8a) expired on 30 November 2022. This effectively ended the special pandemic compensation regime under § 9 of the Act.

Today, therefore, no new claims for compensation under the Crisis Act or the Pandemic Act arise. However, older claims can still be asserted if they are not time-barred, or compensation can be claimed under the Act on State Liability for Damage if the damage was caused by an unlawful decision or an incorrect official procedure.

What may still be relevant?

• There are ongoing actions by businesses seeking compensation for the pandemic period, where the law has been interpreted differently (e.g. invalidity of certain measures).
• Some disputes are still being decided by the courts – the outcome of which may affect other claims.
• People who have been harmed by the state through an illegal decision or maladministration can still claim compensation under the State Liability Act, but they must prove the illegality of the decision (or maladministration) and the occurrence of the damage.

What about sick leave, quarantine and other benefits today

Although covid is regaining momentum in some periods, the legislation has changed significantly compared to 2020. Quarantine and isolation are now ordered individually, not across the board, and employees are only entitled to standard sick pay (or wage replacement from their employer for the first 14 days). The emergency allowance known as the isolation allowance, which provided up to CZK 370 per day during the pandemic, has also disappeared.

If a child falls ill, parents can draw normal sick pay as the special covid schemes no longer apply. Compensation for personal injury is only an option in very limited cases. There is a special law on covid vaccination which regulates the liability of the State for damage caused by compulsory vaccination against covid-19.

It is important to emphasise that this regime applies only to serious consequences, typically so-called particularly serious injury or death. As a rule, ordinary or short-term health complications, as well as the actual infection with covida, do not give rise to a claim for compensation.

Moreover, businesses can no longer claim automatic compensation for damage caused by emergency hygiene measures, as was the case for emergency measures during a state of emergency. A claim arises only if the specific decision was unlawful, demonstrable damage has been caused and there is a causal link between the measure and the damage.

Also often forgotten is the possibility of a claim under commercial blackout insurance. Many insurance policies cover such a situation at least partially, but insurers often refuse to pay. That is why a detailed legal analysis is worthwhile in these cases to check whether the business has a chance of success. We will be happy to help you with it.

Why compensation is no longer automatic

At the time of the pandemic, it was necessary to distinguish between several legal regimes, which changed over time. First, there were crisis measures under the Crisis Act, which were taken exclusively during a state of emergency and automatically gave rise to liability for damages on the part of the state.

Since 2021, they have been joined by the Pandemic Law, which allowed emergency measures to be taken even without a state of emergency, but also introduced a narrower and stricter compensation regime. Compensation was limited to actual damages, not lost profits, and was linked to the fulfilment of other legal conditions.

In addition, there were and still are emergency measures under the Public Health Protection Act which do not in themselves give rise to a claim for compensation. Compensation is only available if the decision in question is shown to be unlawful.

None of the emergency pandemic regimes are currently in force. Covid is not assessed as an emergency situation threatening the functioning of the State, and no state of emergency or pandemic alert has been declared. The legal basis for blanket and automatic compensation for damage caused by covid does not exist today.

Not sure if you are entitled to compensation?

The legal issues surrounding covid are extremely complex. They mix crisis legislation, public health, private claims and commercial relationships. In many cases, we see authorities rejecting claims without relevant justification, key evidence that needs to be added, businesses misidentifying the type of compensation to which they are entitled, and insurers refusing to pay because the covid “was not an insured event”.

If you contact us, we can help you analyse whether your claim still exists and how to pursue it, prepare accurate evidence, negotiate with ministries, authorities or insurance companies and represent you in court proceedings if necessary. This will save you time, stress and increase the likelihood of actually getting your money.

Summary

There were two main compensation schemes during the 2020-2022 Covid-19 pandemic: under section 36 of the Crisis Act for damage caused by emergency measures during the emergency (including lost profits) and under section 9 of the Pandemic Act for emergency measures during the pandemic alert (actual damage only, no lost profits, with set-offs and an obligation to minimise damage), whereby claims were not automatic, the existence of the measure, the occurrence of damage and causation had to be proved, and relatively strict time limits applied, which many victims missed; the pandemic alert ended on 5 April 2010. 5. 2022 and most of the pandemic law expired on 30 November 2022. 2022, so that no new claims arise today under the Crisis and Pandemic Acts, but it is still possible to pursue older, non-limited claims or to seek compensation under the Act on State Liability for Damage if caused by an unlawful decision or maladministration, which is currently the subject of some litigation; at the same time, the normal regime of sickness, quarantine and sickness allowance without extraordinary covida supplements applies today, compensation for personal injury is only exceptionally available, especially for serious consequences after vaccination under a special law, and entrepreneurs are not entitled to automatic compensation for damages from sanitary measures unless they can prove their illegality; in practice, commercial insurance claims may also be relevant, but often require a thorough legal analysis.