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Legal Advice

Corona crisis: practical questions on the introduction of short-time work

As a re­sult of the corona cri­sis, the workload of em­ployees in nu­me­rous com­pa­nies has drop­ped si­gni­fi­cantly. In or­der to avoid a re­duc­tion in per­son­nel, a sim­pli­fied ap­pli­ca­tion of short-time­work al­lo­wance has been es­ta­blis­hed, with re­troac­tive ef­fect from March 1, 2020.

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.

Ex­am­ples:

  • 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.

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