COVID-19 - Germany extended business support regulations

We have outlined below the extended regulations to support businesses during the pandemic in relation to short-time work, insolvency law and reimbursement of certain operational costs.

Short-time work

• For companies that have introduced short-time work until 31 December 2020, receipt of short-time working compensation will be extended from the regular 12 months to 24 months.
• In this context, social security contributions will be fully reimbursed until 30 June 2021. From 1 July 2021 to 31 December 2021 at the latest, half of the social security contributions will be reimbursed.
• The regular short-time work allowance of 60% (67% for employees with children) of the net wage delta is still increased to 70% (77% for employees with children) from the 4th month of payment and to 80% (87% for employees with children) from the 7th month of payment.

Insolvency law

• The obligation to file for insolvency due to over-indebtedness is further suspended until the end of this year.

Reimbursement of operating costs

• The reimbursement of fixed operational costs of up to 150,000 EUR for companies under particular financial pressure will be extended until the end of the year.

Our team in Germany would be happy to answer any questions about these revised provisions.

See our coronavirus (COVID-19) feature for more information generally on the possible legal implications of COVID-19.