Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure DE-2021-1/2158 – measures in Germany
Country | Germany , applies nationwide |
Time period | Temporary, 01 January 2021 – 31 March 2022 |
Context | COVID-19 |
Type | Bipartite collective agreements |
Category |
Promoting the economic, labour market and social recovery into a green future
– Support for spending, stimulus packages |
Author | Birgit Kraemer (Hans Boeckler Foundation) and Eurofound |
Measure added | 12 January 2022 (updated 14 March 2022) |
On average, collectively agreed wages have been rising by 1.7 percentage points in 2021 compared to 2020. With inflation rates around 3.1% this implies a loss in real wages. In many sectors and companies, social partners negotiated COVID-19 related bonuses to compensate for extraordinary burdens for employees due to the pandemic. From an economic and social perspective, these bonuses compensated at least partly for the losses in purchasing power due to inflation and can thus partly mitigate social hardship and stimulate consumption at the same time. However, it must be considered that special payments are a result of wage negotiations between social partners and might come instead of a (higher) percentage increase of the regular wage.
The government incentivised COVID-19 related special payments up to €1,500 by exempting them from tax and social security contributions until 31 March 2022, under the conditions that they do not replace any regular remuneration.
COVID-19 related bonuses have been negotiated between the social partners in many sectors and companies in 2021. These special payments are normally one or two-time extra payments which come on top of the regular salary. They are supposed to compensate employees for extraordinary burdens at the workplace during the pandemic. The level of the bonuses ranged from €90 in the confectionary industry to €1,300 in the public service of the German states.
The government supports these payments by exempting them from tax and social security contributions. Furthermore, for workers active in elderly and hospital care who directly work with COVID-19 patients, the German public health funds support the employers by co-funding bonuses with up to €100 million.
For 2022, the new government announced in their coalition agreement that they will arrange for a second extra payment for care workers with a level of up to €3,000. The government intends to co-fund these payments with €1 billion.
There is no full data set available. Here is a short overview with selected examples of COVID-19 related bonuses from the WSI 2021 collective bargaining report:
Workers | Businesses | Citizens |
---|---|---|
Applies to all workers | Applies to all businesses | Does not apply to citizens |
Actors | Funding |
---|---|
National government
Trade unions Employers' organisations Company / Companies |
Companies
National funds |
Social partners' role in designing the measure and form of involvement:
Trade unions | Employers' organisations | |
---|---|---|
Role | Consulted | Consulted |
Form | Not applicable | Not applicable |
Social partners' role in the implementation, monitoring and assessment phase:
Social partners negotiate collective agreements including possible COVID-19 related bonuses in the framework of the social partners' autonomy.
Social partners are responsible for the negotiation of collective agreements in the framework of the social partners' autonomy.
Citation
Eurofound (2022), Overview of bonuses in 2021 collective agreements, measure DE-2021-1/2158 (measures in Germany), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/DE-2021-1_2158.html
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30 January 2023
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