Berlin (dpa) – With prolonged work in the short term, an extreme crown-related increase in the number of unemployed in Germany should be avoided in the coming year. The Bundestag passed the so-called labor safety law.
This means that special rules on short-time work will extend beyond this year until the end of 2021. Business associations and unions welcomed this. The opposition did not reject the extension, but nevertheless voiced criticism.
Federal Labor Minister Hubertus Heil (SPD) said in the Bundestag that the means of short-time work, like few countries in the world, have secured jobs in the crisis. “Short-term work is currently our most stable bridge across a deep economic valley,” Heil said. In the US, like the word “kindergarten” in the past, the German term “short-term job benefits” means to pursue a career.
BENEFITS FOR LARGER-THAN NORMAL SHORT WORKERS IN THE CRISIS
Specifically, on Friday it was decided that the short-time allowance will also be increased in the next year from the fourth reference month of its usual amount, that is, 60 of the salary, to 70 percent, for employees with children 67 to 77 percent. Starting from the seventh month of reduced-time work, there must still be 80 or 87 percent of salary. All employees who are sent to work on reduced time before the end of March 2021 should benefit from this. Mini jobs up to € 450 will generally remain credit-free until the end of 2021.
In October, the reimbursement of social security contributions during part-time work was extended until next year by ordinance in order to relieve employers. The maximum possible duration of short-term work benefit has also been extended to 24 months. A law was necessary for the steps that have now been decided. Finally, it has to go through the Federal Council, which has already made it clear that it has no objections.
Originally, the many special regulations on short-time benefits were supposed to expire at the end of the year. However, the government is not yet assuming that the situation will ease, as it writes in the explanatory memorandum of its bill.
Meanwhile, SIX MILLION PEOPLE IN SHORT WORK
If companies have difficulties and reduce the working hours of their employees, the Federal Employment Agency (BA) steps in and replaces part of the lost net income with a reduced-time work allowance. In this way, times of crisis must be saved without companies being forced to lay off staff. Some companies and industries also complete the part-time allowance with their own amounts, so the loss of employee income remains low.
According to the government, about 620,000 people nationwide were unemployed between March and August 2020. Without the relief in short-term job benefits, the increase would have been significantly higher, they say. Four out of ten companies recently stated in a survey by Boston Consulting Group (BCG) that they would have had to cut jobs without working short-time.
At the height of the first Corona wave in April, nearly six million people were working short-time. According to the latest figures from the Federal Employment Agency (BA), companies had registered short-time work for 2.58 million people in August.
GREAT EXPENSES ON SHORT PAYMENTS TO EMPLOYEES
The sums that are being spent on this in the Crown crisis are enormous: according to Heil, it was already around 18 billion euros this year. A spokesperson for the BA estimated the spending on part-time at the request of the German Press Agency at 19.4 billion euros. For next year, the bill calls for additional spending in the authority’s budget of a good six billion euros. The instrument was “very, very expensive,” Heil said. “But getting used to mass unemployment would be economically and socially more expensive for this country,” he added.
REVIEW OF THE OPPOSITION, PRAISE OF THE ECONOMY
In the vote of the law in the Bundestag, the opposition parties did not reject the extension of the special rules for reduced working hours, but they abstained. The AfD accused the government of taking the step only to avoid debates about the consequences of the closure measures before next year’s general elections. The FDP also called for relief for companies in terms of investments and taxes so that new jobs can be created.
The accolades came from business. “This enlargement, which will undoubtedly be the last, is good crisis management on the part of the coalition. Without the short-time work crisis, we would already have several million more unemployed “, said the managing director of the Gesamtmetall employer’s association, Oliver Zander. There was also approval from the hotel and catering industry, which was particularly affected. Politicians have set the right course, the managing director of the German Hotel and Restaurant Association (Dehoga), Sandra Warden, said on Friday. From March to October, according to the association, almost 130,000 hospitality companies reported short-time work.
There were also positive reactions from the German Federation of Trade Unions. Thanks to the extended rules, companies remained flexible and were able to largely retain jobs despite tough times, said board member Anja Piel.