Bundestag extends short-time work

Bundestag extends short-time work

Extended short-time work is also intended to prevent an extreme corona-induced rise in unemployment figures in germany in the coming year. On friday, the bundestag passed the so-called law to safeguard employment. This means that special rules on short-time working will be extended beyond this year until the end of 2021. Business associations and trade unions welcomed the. The opposition did not reject the extension, but nevertheless voiced criticism.

Federal labor minister hubertus heil (SPD) told the bundestag that short-time work had been used to safeguard jobs during the crisis, as few countries in the world had done. "Short-time work is currently our most stable bridge over a deep economic trough", said heil. In the USA, the word "kindergarten" has come to mean the same thing as in the past, the german term "the kurzarbeitergeld career. 1. In the crisis, higher short-time allowance than usual it was decided on friday that short-time allowance will be increased from its usual level of 60 percent of wages to 70 percent in the coming year, starting in the fourth month of payment – and from 67 to 77 percent for employees with children. From the seventh month in short-time work, 80 or 87 percent of wages should continue to be paid. All employees who are put on short-time working until the end of march 2021 are to benefit from the scheme. Mini-jobs up to 450 euros will generally remain exempt until the end of 2021. In october, the reimbursement of social security contributions during short-time work was extended into the next year by decree in order to ease the burden on employers. The maximum period for which short-time allowances can be drawn was also extended to up to 24 months. A law was needed for the steps that have now been adopted. Finally, it still has to pass the bundesrat, which has already made it clear that it has no objections.

The numerous special regulations on short-time allowances were originally to expire at the end of the year. However, the government does not yet expect the situation to ease, as it writes in the explanatory memorandum to its draft legislation. 2. Six million people are now on short-time work when companies run into difficulties and reduce the working hours of their employees, the federal employment agency (BA) steps in and replaces a portion of the lost net income with short-time work benefits. This is intended to bridge times of crisis without companies being forced to lay off people. Some companies and sectors are also topping up short-time allowances with their own contributions, so that the loss of income for employees remains low.

From march to august 2020, around 620,000 people became unemployed nationwide, according to government figures. Without the simplification of short-time allowances, the increase would have been considerably higher, it is said. In a recent survey by the boston consulting group (BCG), four out of ten companies stated that they would have had to cut jobs without short-time work.

At the peak of the first corona wave in april, almost six million people were in short-time work. According to the latest figures from the federal employment agency (BA), companies had registered 2.58 million people for short-time work in august. 3. Enormous expenditure on short-time allowance the sums spent on this in the corona crisis are enormous: this year, according to heil, it was already around 18 billion euros. In response to a question from the german press agency, a spokesman for the federal employment agency put spending on short-time work at 19.4 billion euros. For the coming year, the draft law specifies additional expenditure in the authority’s budget of a good six billion euros. The instrument is "very, very expensive, said heil. "But getting used to mass unemployment would be immensely more expensive financially and socially for this country", he added. 4. Criticism from the opposition, praise from the business community during the vote on the bill in the bundestag, the opposition parties did not reject the extension of the special short-time work rules, but abstained unanimously. The afd accused the government of taking the step only to avoid debates about the consequences of the lockdown measures before next year’s federal election. The FDP demanded additional relief for companies in terms of investments and taxes, so that new jobs could be created. Praise came from the business community. "This certainly last extension is good crisis management of the coalition. Without the crisis short-time work, we would already have several million more unemployed", said the managing director of the employers’ association gesamtmetall, oliver zander. Approval also came from the hotel and catering industry, which was particularly hard hit. Politicians have set the right course, the managing director of the german hotel and restaurant association (dehoga), sandra warden, announced on friday. According to the association, almost 130,000 hospitality companies reported short-time work between march and october.

Positive reactions also from the german trade union federation. The extended rules would allow companies to remain flexible and largely preserve jobs despite the difficult times, said board member anja piel.