Human Capital (Employment) - Euroview

    View Authors June 2009

    German Government extends short-time working benefits

    In Germany short-time working has been a key element in the Federal Government's response to the current recession. It enables employers to avoid redundancies by placing employees on reduced hours for a set period of time. In such circumstances employees are entitled to receive short-time working benefits from the Government to help compensate them for their reduced earnings. The benefits are paid to employees via their employers.

    Use of the scheme has risen massively over the last year. According to the Federal Employment Office there are currently between 1.3 and 1.5 million employees working reduced hours. In January 2009 over 10,000 employers applied for public short-time working benefits in respect of 290,600 employees, citing economic reasons. This represented an increase of 274,000 claimants on the same time last year.

    In response to these statistics the German Government has decided to increase the period of entitlement to short-time working benefits from 18 to 24 months. It will also relieve employers of their obligation to pay social security contributions if they have been operating short-time working for at least 6 months.

    In May 2008, international law firm Hammonds became a limited liability partnership. Hammonds LLP and its affiliated undertakings has offices in Birmingham, Leeds, London and Manchester in the UK, and in Berlin, Brussels, Beijing, Hong Kong, Madrid, Munich and Paris.