Current Covid Situation in Germany I Economic Support Package I Law

In this article, Att. Hülya Oruç will be examining the Current Covid Situation in Germany.

Current Covid Situation in Germany

On 11 March 2020, the WHO declared a pandemic of diseases caused by the novel coronaviruses (COVID-19). The increase in the number of infected persons in Germany to approx. 5,800 cases have led many governments of the federal states to take more stringent measures.

Since Germany has a federal system, the sovereign power over infection control is held by the federal states. Thus, the federal states initially acted inconsistently and inconsistent recommendations were made or measure taken. As of 16 March 2020, most of the 16 German federal states closed their schools until at least 15 April 2020. Employees must now look after their children themselves.

However, in some places, there is emergency care for people who, for example, have a medical profession and need to be available for patient care. This also applies to police officers and fire brigades. Rail traffic and many flights have been drastically cut back because, on the one hand, they are currently little used and people are not supposed to spread the virus. Furthermore, bars, clubs, cinemas, theatres, operas, saunas, leisure pools, and amusement arcades remain in some federal states. Food shops, pharmacies, and drugstores are still open.

People who need a certificate of incapacity for work can have it issued for a maximum of 7 days after consulting their Doctor by telephone. It is not necessary to visit a doctor’s surgery for this. This arrangement is limited until 9 April 2020.

In general, it is recommended that all persons who have traveled back from risk areas avoid unnecessary contact and stay at home for at least 14 days. The Robert Koch Institute is currently supplementing the risk areas for this purpose. These currently include China, Italy, Iran, South Korea, Spain, and the USA.

The following advice can be given to employees:

The Federal Minister of Health and almost all Minister Presidents have recommended working from the home office. Hospital visits are further restricted or prohibited. Furthermore, employees who wish to voluntarily enter quarantine can make the following arrangements with their employer: unpaid leave or home office.

If the quarantine is nevertheless ordered, the employer will continue to pay the salary for up to 6 weeks. The employer can then take back the money for the continued salary payment from the Bundeslang. The payment corresponds approximately to the amount of the net salary. After 6 weeks the so-called sick pay is paid.

Employers can also apply for short-time work benefits. The prerequisites are that the usual working hours are temporarily reduced considerably, that operational and personal requirement is met and that a notification is made to the Employment Agency.

In the event of a corona pandemic, it is important to report short-time work to the responsible employment agency in advance. The latter will then check whether the conditions for the benefit are met. This support can be used to compensate for the loss of earnings in parts for a maximum of 12 months. The amount of short-time work compensation is calculated according to the net loss of remuneration. Employees on reduced hours generally receive 60% of the flat-rate net remuneration.

The self-employed and freelancers are also compensated for the loss of earnings in accordance with the law for the prevention and control of infectious diseases. In this case, the competent authority assumes the profit that was determined in the tax assessment notice for the previous calendar year. Furthermore, self-employed persons can apply for ALG II (so-called Hartz IV). The amount of assistance depends on the income received from self-employment in the last six months.

Gurcan Partners International Law Firm is a corporate member of Association of German Chambers of Industry and Commerce.

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UPDATE 16 March 2020:

Federal Minister of Economics Altmaier and Finance Minister Scholz have presented a package of measures that promises rapid assistance for employees and companies. The so-called protective shield is intended to provide relief as follows:

The short-time work allowance is to become more flexible; in concrete terms, companies are to receive short-time work allowance under eased conditions.
Tax relief: the deferral of tax payments is to be made easier; it should be easier to reduce advance payments; enforcement measures until 31 December 2020 will be waived
Liquidity of companies is to be protected: existing KfW Bank programs and ERP loans (for young companies under 5 years old) are to be expanded

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