This is associated with numerous open questions - for employers and employees alike. You will find answers to the most important questions in our FAQ.
What types of short-time work do exist?
Short-time work means the temporary reduction of working hours.
- Zero working hours = reduction of weekly working hours to zero.
- Working hours reduced to 50 %: = reduction of weekly working hours by 50 %. The employee is only assigned 50 % of his or her regular working hours, since there is no higher demand.
- For a temporary increase in the short-time working allowance from the fourth or seventh month, see here.
When, to what amount and from whom do employees receive short-time allowance?
Short-time work allowance is paid by the employer to the employees at the end of the month.
- „In the case of zero working hours, employees who have at least one child receive 67 % of their net remuneration (= nominal remuneration) and all other employees 60 % of their net remuneration. If collective bargaining agreements provide for supplements to short-time work allowances, these must be granted in addition. Employers may also make additional financial contributions on a voluntary basis; the general principle of equal treatment must be ensured.
- In the event of short-time work > zero, employees will receive salary and social security contributions only at the percentage rate at which they work. With short-time work reduced to 50 %, for example, the employer only has to pay half of the salary (plus corresponding non-wage labour costs) directly. In addition to the employer's contribution, the employee also receives a “short-time work allowance”. The difference between the actual net remuneration after reduced working hours and the net remuneration for regular working hours forms the basis of the calculation and amounts to 60 % (and 67 % respectively for employees with children) of the in-come loss.
Are employees allowed to take on a second job during a period of short-time work?
In principle, employees may pursue a second job during short-time work, but it should be noted that a second job that was taken up after the start of short-time work reduces the entitlement to short-time work allowance.
Example: The nominal remuneration is EUR 2,000, the actual remuneration due to reduced working hours is EUR 0. Thus, the entitlement to short-time allowance would amount to 60 % or 67 % of EUR 2,000. If the employee however accepts a part-time job during the short-time work phase, the earnings from it will reduce the difference between the nominal and actual remuneration, and therefore also the amount of the short-time work allowance.
Important: No crediting of the secondary employment against the short-time work allowance takes place if employees are employed as seasonal workers in agriculture during the short-time work phase or if the secondary employment was already taken up before the start of short-time work.
What happens to leave of absence that has already been approved and which now falls into the period of short-time work?
Employees can still take already approved leave holidays. The employer cannot withdraw the leave of absence that has already been approved. For the duration of the leave of absence, the employee does not receive short-time work allowance despite short-time work but receives full holiday pay.
Is the holiday entitlement reduced in times of short-time work?
(e.g. 4 weeks short-time work allowance - 2.5 days holiday entitlement)
If short-time work is ordered to be reduced to zero, a corresponding reduction of the holiday entitlement is basically permissible. Collective agreements may contain different regulations.
What is the situation regarding fixed-term contracts or employees in their work trial period?
Employees with fixed-term employment contracts and employees on trial periods are also entitled to short-time work benefits.
How is the situation regarding the marginally employed to be assessed?
The marginally employed are not entitled to short-time work compensation. There are two options here (in addition to paid leave):
- Conclusion by mutual agreement of a supplementary agreement suspending the employment relationship (unpaid leave).
- Arrangement of the build-up of minus hours.
Why do employees first have to take their remaining leave from 2019?
Prerequisite for claiming short-time work allowance is that employees first take their remaining vacation from 2019.
Is it legally possible to order a company shutdown?
In companies with a works council, a works council agreement can be used to introduce a company shutdown. However, special notice periods must be observed. In addition, at least 2/5 of the annual leave must remain at the employees' free disposal. In companies without a works council, corresponding agreements must be concluded individually with the employees.
Can the duration of short-time work also be reduced if - contrary to expectations - the situation changes for the better?
Yes, the duration of short-time work can also be reduced again ahead of schedule, provided that the notice periods agreed in the works agreement or the individual supplementary agreements are observed. Any notification of a longer period of short-time work that has already been given to the employment agency can also be modified at any time when the application for short-time work allowance is submitted.
How is the short-time allowance been calculated?
From time to time the net salary fluctuates due to various reasons.
The basis for calculating the short-time work allowance is the "lump sum net remuneration". The calculation of this lump-sum net remuneration is a purely arithmetical procedure, in which three values are deducted from the gross remuneration specified in the employment contract:
- Social security flat rate of 20 %
- Income tax
- Solidarity surcharge
Why are several months of short-time work being introduced, even though the situation may have improved significantly by the end of April?
Companies can apply for up to twelve months of short-time work - depending on how long the reduction in work is expected to last. Since there is currently no reliable indication of when the situation will improve again, companies can save themselves the trouble of recurring notifications and immediately report short-time work for a longer period. It is possible to terminate or flexibly adjust short-time work at any time.
Can individual employees also be brought back flexibly if this becomes necessary? How are they then remunerated?
If necessary, it is possible to bring individual employees back from short-time work on a flexible level, provided that reasonable deadlines are observed. They receive their normal remuneration for the hours worked and short-time work allowance for the cancelled hours.
How does short-time work affect the use of company cars?
The possibility of using a company car despite a short-time working phase should lead to a pecuniary advantage subject to income tax, which is taxable as before. If fewer trips to the workplace are actually made (<15), it may be possible to switch from the 0.3 % rule to 0.002 % per actual trip.
Are trainees entitled to short-time work allowance?
As a rule, it is not possible to order short-time work for trainees, as the company providing training is obliged to exhaust all means to ensure that training continues. For example, the company has the following options:
- Change of the curriculum by bringing forward other learning contents
- Transfer to another department
- Transfer back to the training workshop
- Organisation of special training events
Only when all possibilities have been exhausted can short-time work also be considered for trainees. If trainees are ordered to work reduced hours, they are entitled to payment of the full training allowance for at least six weeks. In deviation from the statutory minimum duration, training and collective agreements may provide for longer periods. Subsequently, they are entitled to short-time allowance.
What about employees who were already on sick leave for an indefinite period before short-time work began? Do these employees receive short-time work allowance or continued pay?
If the employee had already been incapacitated for work before the period of short-time work began, the employer must first continue to pay continued remuneration to the employer as long as short-time work had not yet been implemented. However, as soon as and as long as an employee is unable to work due to short-time work, the continued remuneration to be paid is reduced by the lost working time. In addition to the reduced continued remuneration, partial sick pay is granted in the amount of the reduced short-time work allowance. This is paid by the employer. If the continued remuneration period ends, the supplementary sick pay also ends. This is replaced by general sickpay. With the beginning of this benefit, the risk of replacing the lost remuneration is transferred in full to the health insurance. Sick pay takes priority over the entitlement to short-time work allowance.
Does the receipt of short-time work allowance influence the amount of parental benefits?
Yes. Parental benefit amounts to 67 % of the average monthly net income from employment in the 12 months preceding the birth. Compensation benefits are not considered as income. Short-time work allowance is therefore not included in the calculation of parental benefits because they replace wages.
Can the short-time working allowance be increased by a supplement in the collective agreement?
Various collective bargaining agreements already provide for (mainly moderate) top-up amounts to the short-time working allowance. In contrast, the collective bargaining agreement for the retail sector in North Rhine-Westphalia (NRW) has so far been reserved. Apart from a four-week notice period, which had to be observed, the employers were largely free to design short-time work. That time is over now. With retroactive effect from 1 March 2020 and limited in time until 30 June 2020, ver.di and the Handelsverband Nordrhein-Westfalen e.V. (Trade Association of North Rhine-Westphalia) adopted a supplement to MTV Einzelhandel NRW. Without giving the parties to the agreement any leeway via an opening clause to take account of the economic performance of the company concerned, an increase in the short-time working allowance to 100 % of the regular net remuneration of the employees affected by short-time working for the first four weeks after announcement and to 90 % at the end of the four weeks was adopted. In return, the period of notice shall not apply. To compensate for the tax liability on the top-up amount (top-up payments are taxable), the top-up amount is also increased by a further 15 %.
Note: According to the Handelsverband Nordrhein-Westfalen e. V., there are no plans for comparable collective agreements in other collective bargaining areas.