If the employer has a shortage of orders and the employees cannot therefore be fully employed in the long term, the employer has two options. On the one hand, the employer can try to dismiss part of the workforce for operational reasons. This often only leads to further problems. If it is foreseeable for the company that the shortage of orders will be short-lived, the introduction of short-time work should be considered.
When can short-time work be ordered?
Short-time work is the temporary reduction of the agreed working time. In extreme cases, a reduction in working hours to zero may be possible.
Since working time is usually clearly regulated in the employment contract, the employer may not order short-time work unilaterally. There must be an agreement between the employee and the employer that short-time work can be introduced. A regulation can exist, for example, in the employment contract or in an applicable collective agreement. However, a written regulation is not necessarily required. It would also be sufficient if the company asked its employees orally to work short-time.
If the employees comply with this request, the shortened working time is effectively agreed. When there is no verbal or written agreement, the unilateral order is invalid. If the employee then continues to offer the employer his full labour force, the employer must also remunerate this accordingly. This claim results from § 615 of the German Civil Code (BGB). In principle, the employer must bear the economic risk. If the employer does not pay the entire wage, the employee has a claim to payment, which he can also assert in court.
With the arrangement of short-time work for operational reasons the employer must consider besides the right of codetermination of the work council, if such exists, after § 87 I Nr. 3 BetrVG.
As a result of short-time work, the employee is partially released from his obligation to work and the employer is not obliged to pay wages to the same extent. According to §§ 95 ff. SGB III, the employees concerned are entitled to short-time work benefit under certain conditions. The employee receives short-time work allowance from the Employment Agency for the duration of the absence from work. However, the benefit is limited to 12 months. The short-time work allowance must be calculated in the same way as unemployment benefit I. Employees receive 60 percent of their net wage, those with children receive the increased rate of 67 percent. In view of the corona pandemic, these rates were increased for a transitional period.
It should also be noted that the employer must report short-time work and also apply for short-time compensation. How this works is explained in this publication by Lawyer Rainer Polzin (in German only).