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Short-time work means that some or all of a company's employees have to work shorter hours because of absenteeism. In some cases, you may not work at all for a certain period of time.
In order to ensure that your salary continues to be paid, the state has reintroduced the short-time work allowance (Kug) [Kurzarbeitergeld].
In this case, your employer pays your salary first, but then receives Kug back from the government.
The last time the Kug was introduced was during the financial crisis in 2008, in order to save jobs. Now, in times of Covid-19, this allowance is supposed to ensure that you can pay your bills even though your employer cannot employ you fully.
If you want to know how much Kug you are entitled to, use our short-time work allowance calculator.
Here are a few answers that we hope will be helpful to you…
Your employer must contact the employment agency to receive Kug, and fill in and submit certain forms. If your company has a works council, it also needs to approve. If you do not have a collective agreement on short-time work in your company, the employees must agree to the short-time work compensation individually.
Your employer will then agree with you by what percentage your working hours are to be reduced. This can be different from person to person, for example one person works only 30 %, another colleague 70 %.
The proportion of employees who must be affected by absenteeism in the company is to be reduced to up to 10 %. Previously, at least one third of the employees had to be affected by a loss of earnings exceeding 10%
It is also important to note that not the whole company has to work short-time; only part of your company can do so. Your employer must first fill in a form and inform the BfA, followed by an application to receive Kug.
It is important that you have not yet been dismissed, otherwise you will not receive Kug. Nor should you have signed a termination agreement.
Pensioners, trainees, mini-jobbers or people receiving sickness benefits are also excluded.
However, temporary workers are entitled to Kug.
Even if you have financial reserves, you do not have to declare them or use them up as long as they are not considerable.
Last Updated: 24.04.2020
The corona virus does not just have an effect on individuals' health but also a huge impact on the economy.
We put together some information for companies that are currently struggling to keep their employees fully employed.
Employers can apply to the Federal Employment Agency [Bundesagentur für Arbeit; short: BfA] for short-time work compensation [Kurzarbeitergeld; short: Kug] for their employees if these are currently working less or not at all.
Good reasons for a approval are if the company has to be temporarily closed by government orders or if working hours have to be reduced due to missing deliveries.
First of all, the company in question must notify the BfA of the short-time work online.
Then, the Federal Agency must determine whether the conditions for Kug are met. If this is the case, the Kug can be applied for online.
So first, there is the online notification, then the online application.
Due to the economic problems caused by Corona, the BfA has changed and facilitated the reasons for granting a licence, thus trying to avoid dismissals.
Pure financial losses cannot be compensated by the Kug. The entitlement to state support is based on different conditions:
If you want to apply for short-time work compensation (Kug), you must inform your employees in advance.
Often an agreement is then reached with the works council. If your company does not have a works council, all employees affected by the regulation must agree.
It is important that certain collectively agreed entitlements and deadlines are adhered to when making the announcement.
The next step: Now you can select the BfA at your company headquarters.
Last Updated: 29.03.2020