Many are saying we now have a ‘German-style’ short-time working scheme. But I think there are at least four key differences to the German 'Kurzarbeit' scheme: (1/5)
Key difference 1: With Kurzarbeit there is no employer contribution for hours not worked. In the UK this contribution is 33%. So in the German system it is less costly for firms to retain workers. (2/5)
Key difference 2: In Germany, for hours not worked, the employer does not pay social security contributions. In the UK, as far as I can see, the employer pays the full NIC and pension contributions – both for hours worked and not worked. (3/5)
Key difference 3: For people that are on the scheme for longer, the German subsidy increases (if they have lost at least half of their income). From 60% to 70% after 4 months, to 80% after 7 months. And up to 87% for people with children. In the UK it’s 66% flat. (4/5)
Key difference 4: people can be on Kurzarbeit for 24 months. (5/5)
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