Overview of the most important aspects of short-time work as part of the coronavirus crisis

As already reported, the German government, parliament and state representatives have addressed important aspects of the issue of short-time working.

On Friday, 13 March, a fast-track procedure was used to decide on easing the burden on companies. The following three modifications to short-time working will come into force for a limited period (until the end of 2021) backdated to March 1, 2020:

1. Reduction of the materiality threshold: 10 % of employees must be affected by loss of earnings (due to loss of work) - previously, 1/3 of employees had to be affected.
2. No accumulation of negative time balances: Companies do not have to build up negative time balances first, if this is at all permissible under company regulations, before short-time work compensation can be paid out - up to now companies have been "forced" to build up minus hours as a milder measure.
3. “Full” reimbursement of social contributions: According to official statements, employers are exempted from paying social contributions when providing short-time work compensation - until now, companies had to pay a certain amount of the social contributions incurred.

SKW Schwarz provides advice on all issues relating to short-time work (e.g: "May short-time work be ordered? What are the requirements? What are the consequences and alternatives?"); furthermore, we refer to our article on the corona virus. We will keep you informed about further developments.

Status: March 16, 2020