Factsheet for measure
DE-1957-1/2460
– measures in Germany
Short-time working allowance
Kurzarbeitergeld
Background information
The short-time work allowance according to the German Social Code III can be used in the case of a temporary reduction of regular working hours in a company due to a significant reduction in production or services.
Reduction of working time needs to be temporary and unavoidable. For example, it must be due to economic conditions (that is a sharp decline in demand), unforeseeable accidents, force major, or structural changes. With a few exemptions, the company must have exhausted all other options that might help to avoid using short-time working.
All workers who pay social security contribution are entitled to short-time work allowances. The application must concern at least one third of all employees of the company (or one or several specific unit(s)). Moreover, the wage cut has to amount to more than 10% of their monthly gross wage.
Content of measure
Three short-time working arrangements exist:
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short-time working due to economic reasons/temporary shortfall of orders (konjunkturelle Kurzarbeit);
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seasonal short-time working (Saisonkurzarbeit); and,
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short-time working in the event of restructuring (Transferkurzarbeit).
As laid down by Social Security Code III, the employer pays for the effective working time and the Federal Employment Agency contributes a short-time working allowance of 60% of the missing net wage (or 67% if the worker has children). In 2022, this allowance is provided for monthly wages that do not exceed €7,050 in Western Germany and €6,750 in Eastern Germany.
Introduction of short-time working has to be agreed upon by management and the works council. If no works council exists, all affected employees have to grant their approval.
The maximum duration of state-funded short-time working allowances is six months. According to the legislation, this maximum duration can be extended by ministerial decree to up to 12 months in cases of exceptional circumstances in the labour market in specific industries or regions. It can be extended even up to 24 months in cases of exceptional circumstances on the general labour market.
Use of measure
In the wake of the COVID-19 crisis, many companies applied for short-time work due to economic reasons. According to the monthly statistics of the German statistical office (destatis 2022), the absolute numbers of workers in short-time work developed as follows (for the months March and April from 2019 to 2022):
March 2019: 245,800
April 2019: 48,700
March 2020: 2,834,300
April 2020: 6,006,800
March 2021: 3,015,900
April 2021: 2,583,300
March 2022: 888,100
Target groups
Actors and funding
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Actors
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Funding
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National government
Public employment service
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National funds
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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|
Role
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Unknown
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Unknown
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|
Form
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Not applicable
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Not applicable
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Social partners' role in the
implementation, monitoring and assessment phase:
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Unknown
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Main level of involvement: Unknown
Involvement
Unknown
Views and reactions
Both the German Trade Union Federation (DGB) and the German Employers' Association (BDA) support the measure. The DGB has been calling for rising the short-time work allowance to 80% of the wage of a worker (DGB 2020). The BDA supports the possibility for short-time work in principle but claims that short-time work cannot be a long-term solution because it would be to bureacratic and expensive in its current form (BR24 2022).
Sources
