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Applying for short-time work benefits – a guide

The OECD is sounding the alarm. The coronavirus threatens to deal an additional blow to the global economy, already weakened by trade disputes and political tensions, said OECD chief economist Laurence Boone. New economic stimulus packages are therefore being discussed in politics.

Companies can already apply for short-time work benefits. The following steps should be taken into account:

1. The employer must report the loss of work to the Federal Employment Agency. To report the loss of work, the form “Kug 101 – 01.2020” must be used, which is available on the employment agency website.

a. The notification must be made in writing, whereby fax and email (scanned documents with signature) are sufficient.

b. The local employment agency is responsible for operations. For national companies, a uniform clerk can be agreed with the employment agency.

c. Short-time work must be agreed individually through a works agreement with the works council or – if there is no such agreement – ​​with the employees. These agreements must be attached to the application.

d. The company must credibly demonstrate that a loss of work occurred due to an unavoidable event. The inevitable event in this case is the corona virus. In addition, it is necessary to explain, using key figures and explanations, why there is underutilization of employees (= loss of work) due to the virus. This presentation should be very detailed.

e. The company must also demonstrate that the loss of work is only temporary. It must therefore be explained what the scope of work will be once the spread of the corona virus has ended or calmed down.

f. The loss of work must be unavoidable. The employer must therefore demonstrate credibly that

i. that the failure is not customary in the industry, business practice or seasonal or is based exclusively on operational organizational reasons,

ii. that the absence cannot be prevented by granting vacation. Since companies cannot unilaterally order vacation, it is sufficient to explain the vacation system (vacation plan, entry into vacation list, etc.).

iii. that the loss cannot be avoided in whole or in part by using working time models permitted in the company (e.g. working time account). When it comes to the question of avoidability, the only relevant regulations regarding working hours are those that are actually used in the company. The operating parties are not required to change existing working time agreements. The creation of possible negative account balances will be waived – initially until December 31, 2020.

G. Furthermore, in the calendar months in which short-time working allowance is to be claimed, at least a third of the employees employed in the company must be affected by a loss of pay of more than 10 percent of their monthly gross wages. The quota of one third has currently been reduced to 10% – initially limited until December 31, 2020.

H. Operations in the KUG sense is also the operations department.

2. The employer must also apply to the Federal Employment Agency for payment of short-time work benefits. The forms “Kug 107 – 01.2018 and Kug 108 – 01.2018” must be used for this, which can be found on the employment agency website. The short-time working allowance must be applied for for each calendar month and is provisionally approved by the employment agency. The final review will take place within seven months of the end of the last receipt of short-time work allowance. The employment agency can carry out an audit of the company and view the documents at any time.

Till Fehr

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