A difficult economic development or an unpredictable event can make Kurzarbeite (short-time work) necessary in your company. The resulting loss of earnings can be partially compensated by the state with Kurzarbeitergeld (short-time work allowance).
What is the Kurzarbeitergeld (short-time work allowance)?
The reduced job allowance is a benefit that is part of the unemployment insurance package: which in Germany it is guaranteed through the registration at any Insurance Company, activated and payed from the moment you are employed. This equips you with the right to obtain a contribution starting from 60 to 67% of the nett income, in case of job loss.
In the conditions of Kurzarbeitergeld, where the employer decides to reduce your working hours due to difficult economic development or an unpredictable event on the company, the notice for your Kurzarbeit should be first announced by the employer to the competent institutions.
It is important to mention that the allowance for the Kurzarbeit does cover only partially the loss of the profit, but it guarantees the working place, nevertheless the actual conditions of your company would require your dismissal.
This, does not exclude the option that the Employment Agency can make any other reasonable job offers during this period. Contrary, the Employment Agency may ask you to occupy a new job position, which means the earnings from such an employment relationship will consequently reduce the amount of the contribution from Kurzarbeit.
How to apply for Kurzarbeitergeld (short-time work)?
It is the employer who requests the Kurzarbeitergeld. The application must be submitted within 3 months to the employment agency in whose district the competent Lohnabrechnungsstelle is located.
How much is the Kurzarbeitgeld (short-time work) allowance?
The short-time work allowance is calculated based on the net loss of earnings. Short-time employees generally receive 60% of the flat-rate net wage. If at least one child lives in the household, the short-time work allowance is 67% of the total flat-rate net wage.
The above tables help you with the exact calculations:
Table for calculating the 2020 short-time work benefit: https://www.arbeitsagentur.de/datei/kug050-2016_ba014803.pdf
Table for calculating the short-time work allowance for low-wages 2020 : https://www.arbeitsagentur.de/datei/kug51-tabelle-2016_ba015003.pdf
Duration of Kurzarbeitgeld (short-time work)
You can benefit the contribution for a maximum of 12 months.
However, it is also possible to interrupt this period if:
The employer has a large order to fulfil on a short notice, he has the possibility to hire the resource full time again, with the right to send the employee back to Kurzarbeit again, if the company no longer has the demand for him.
During this time, if the employee has been working back on his company for more than 3 months, period during which the contribution for the Kurzarbeit has been payed, the request for a second Kurzarbeitgeld is renewed, meaning that the duration goes back to 12 months
For more detailed information read also the brochure dedicated to Kurzarbeitgeld on: https://www.arbeitsagentur.de/datei/Merkblatt-8b-Kurzarbeitergeld_ba015388.pdf