by Anne KleffmannDr. Tobias Leder

A new federal regulation provides initial guidance on the requirements for short-time work and receipt of short-time compensation.

Key Points:

  • The regulation outlines requirements for:
  • The efficient introduction of short-time working
  • Receiving short-time working compensation
  • The duration and amount of the short-time working compensation

On 13 March 2020, the German Bundestag and Bundesrat passed a law (the so-called “Arbeit-von-Morgen Act,” or  “Work of Tomorrow Act”) in an expedited procedure to temporarily improve the regulations for short-time working compensation in response to the COVID-19 crisis. The legislation aims to support the economy and labor market, based on the recognition that the COVID-19 crisis will result in considerable work absences.

Short-time work is the temporary reduction of working hours with a corresponding reduction in pay. Short-time work zero is the complete cessation of work. The purpose of short-time work is to temporarily relieve the company’s financial burden by reducing personnel costs while maintaining jobs. The loss of remuneration of the employees is usually (partially) compensated by short-time work compensation from the employment agency.

The new law enables the German federal government to facilitate the receipt of short-time work benefits, as well as to extend the benefits by means of a temporary decree regulation that will come into effect retroactively as per 1 March 2020.

German government introduces a series of measures to mitigate fallout for companies and their employees.

by Rainer WilkeDr. Natalie DaghlesDr. Tobias LederJoachim GrittmannDr. Ulrich Klockenbrink, Dr. Thomas Fox

The German Federal Ministry of Finance and the German Federal Ministry for Economic Affairs and Energy have announced a protective shield for employees and companies in Germany in light of COVID-19 implications. The protective shield is based on four pillars, each of which target a: