Beskæftigelsesudvalget 2012-13
BEU Alm.del
Offentligt
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Preface“The Federal Republic of Germany is a democratic and social federalstate.”Article 20 (1) of the German Basic LawGermany is strong because it operates as a social state.The German social security system is one of the best inthe world. It is a locational factor in business because itsupports industry and creates opportunities, not just foremployment and but for participation in society as awhole.
Many generations of women and men have fought hard toachieve what we now take for granted. To ensure thissocial safety net remains tightly meshed, I see it as ourcommon duty to maintain it and adapt it to changing socialconditions.
The social state and the social market economy characterise the Federal Republic ofGermany, make its name ring true around the world and provide a better life for thosewho live here. I want us to work together to ensure it stays that way.
Dr. Ursula von der LeyenFederal Minister of Labour and Social Affairs
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ContentsChild benefit, federal parental benefit, parental leave,maintenance advance, supplementary child allowanceKindergeld, Bundeselterngeld, Elternzeit, Unterhaltsvorschuss, Kinderzuschlag
Protection of working mothersMutterschutz
Promotion of employmentArbeitsförderung
Basic security benefits for job-seekers(Unemployment Benefit II/Social Assistance)Grundsicherung für Arbeitssuchende
Labour lawArbeitsrecht
Industrial democracyBetriebsverfassung
Co-determinationMitbestimmung
Minimum wageMindestlohn
Health and safety at workArbeitsschutz, Unfallverhütung
Occupational accident insuranceUnfallversicherung
Rehabilitation and integration of people withdisabilitiesRehabilitation und Teilhabe von Menschen mit Behinderung
‘Jobs Without Barriers’ and Job4000Jobs ohne Barrieren, Job4000
Health insurance and the electronic health cardKrankenversicherung und elektronische Gesundheitskarte
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Long-term care insurancePflegeversicherung
Pension insuranceRentenversicherung
Promotion of additional provision for old ageFörderung der zusätzlichen Altervorsorge
Compensation and assistance for war victimsSoziale Entschädigung und Kriegsopferversorgung
Social assistanceSozialhilfe
Housing benefitWohngeld
International social securityInternationale Sozialversicherung
The social courtsSozialgerichtsbarkeit
Social security data protectionSozialdatenschutz
Publisher’s informationImpressum
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Child benefit, federal parental benefit, parental leave,maintenance advance, supplementary child allowanceKindergeld, Bundeselterngeld, Elternzeit, Unterhaltsvorschuss, KinderzuschlagChildren are a wonderful gift, but they do cost money. Food, clothes, education and toysall have to be paid for. Child benefit (Kindergeld) helps parents afford them. It is grantedas a tax refund, primarily to meet the constitutional rule that income is untaxable up to achild’s subsistence level. Any child benefit awarded over and above this amount is paidto support the family.
Your rightsAnyone with children who lives in Germany can claim child benefit. Foreign citizens are also entitled, aslong as they have a valid permanent settlement permit (Niederlassungserlaubnis) or temporary, purpose-specific residence permit (Aufenthaltserlaubnis). Under certain circumstances and according to strictcriteria, mothers and fathers living abroad for a period, say for job-related reasons, can also receive childbenefit, although (as ever, with some exceptions) the state only pays the benefit for children living onGerman soil, in an EU member state or in Switzerland.Important: Only one person can receive child benefit for each child. Parents can choose which of themclaims child benefit for the children living in their household.If the parents are separated or divorced, child benefit is paid to the parent the child lives with. In the caseof children who do not live with their parents, child benefit is usually paid to the person in whosehousehold the children live, or who primarily supports them.
Children you can claim forYou can also claim child benefit for:Your spouse’s children if they live in your householdFoster children if they live in your household, are long-term members of your family, and theirparents no longer have custody over themGrandchildren, if you have taken them into your household. Do you meet any of these criteria? Ifso, you can certainly claim child benefit for any children aged 18 or less.The age limit is 25 for the following:Young people in education or training. A child aged 18 or over in education or training cannormally be claimed for until completion of a first vocational qualification or first degree. Inaddition, child benefit can be claimed, for example, for a child who is still in vocational trainingand does not regularly engage in paid work for more than 20 hours a week. A short breakbetween two education or training stages still counts as education or training.Young people doing a year of voluntary community or environmental service under the YouthVoluntary Service Act (Jugendfreiwilligendienstgesetz), voluntary service in the EU Youth ActionProgramme, other voluntary service abroad under Section 14b of the Civilian Alternative ServiceAct (Zivildienstgesetz), “weltwärts” development service in accordance with the Federal Ministryof Economic Cooperation and Development directive of 1 August 2007, ‘all generations’ voluntaryservice under Book VII of the Social Code, § 2 Section 1a, international youth voluntary service inaccordance with the Federal Ministry for Family Affairs, Senior Citizens, Women and Youthdirective of 20 December 2010 (GMBl. 2010 p. 1778) or federal voluntary service in accordancewith the Federal Voluntary Service Act (Bundesfreiwilligendienstgesetz).Young people unable to start or continue vocational training for want of a training place.Up to the age of 21, young people without employment and registered as job seekers with anEmployment Agency.
Special casesIn certain circumstances, parents can continue to claim child benefit when their children are over 25.
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Child benefit is paid for sons over 25 who are still in education or training and have completedcompulsory military or civilian service, or a period of equivalent service (for example as a developmentworker). The age limit of 25 is then raised by the length of their statutory basic military or civilian service.For example, parents whose son has completed nine months of basic military service can claim childbenefit until he is 25 years and 9 months old.You can continue to claim child benefit for disabled children over 25 if theybecame disabled before this age and cannot support themselves.Orphans receive€184in child benefit a month if no one else can claim childbenefit or equivalent payments for them. The same applies for children whodo not know where their parents are.
How to claimTo claim child benefit, you mustapply for it.The family benefits department(Familienkasse)at your localEmployment Agency(Agenturfür Arbeit)will be pleased tohelp – or if you are in publicservice, your employer’s familybenefits department.The Federal EmploymentAgency(Bundesagentur fürArbeit)website(www.bundesagentur-fuer-arbeit.de) contains a wideselection of forms for downloadand lists the addresses of localfamily benefit offices(Familienkassen).
The lawThe law on child benefit is set out in the Income Tax Act(Einkommensteuergesetz) and the Federal Child Benefit Act(Bundeskindergeldgesetz).
InformationIf you have any questions about child benefit, please contact theFamilienkasse (family benefits department) at your local Arbeitsagentur(Employment Agency).
Tax-free allowance for children and tax-free allowance for child-care,child-raising and vocational trainingIf the child benefit payments do not reach the untaxable subsistence levelfor a child, a tax-free allowance for children (€4,368 a year) and a tax-freeallowance for child-care, child-raising and vocational training (€2,640 a year)are deducted from the parents’ taxable income. The tax relief from theseallowances is decreased by the amount of child benefit already paid out.Whether the total tax relief comes up to the amount required by theconstitution is determined in the course of income tax assessment.
How much child benefityou receiveChild benefit is paid monthly asfollows–€184for each of the first twochildren–€190for the third child–€215for the fourth and eachadditional childChild benefit is paid regardless ofthe parents’ income. Under asystem of tax relief for families,child benefit takes the form of atax refund, a tax-free allowancefor children and a tax-freeallowance for child-care, child-rearing or vocational training.Child benefit is paid throughoutthe year. When assessingincome tax, the tax office checksthat the amount of child benefitpaid satisfies the constitutionalrule on tax relief (in other words,that the parents have receivedenough child benefit to cover thetax refund due to them). If not,their tax bill is reduced by the tax-free allowance for children andthe tax-free allowance for child-care, child-rearing and vocationaltraining, less the child benefitthey have already received. If thiscalculation comes out to theparents’ advantage, the childbenefit payments are left as theystand.Child benefit is paid out by thefamily benefits department oflocal employment agencies andpublic sector employers.
Supplementary child benefitClaimants who have built or purchased their own home can claimsupplementary child benefit (Kinderzulage) for up to eight years, in additionto the normal child benefit, as part of the grants paid to encourage homeownership. Owner-occupiers of homes for which the contract of sale wassigned or which the claimants began building before 1 January 2004 receive€767a year for each child. Claimants who purchased or began buildingsince then but not later than 31 December 2005 receive€800.Because taxconcessions for home owners (Eigenheimzulage) were abolished on 1January 2006, supplementary child benefit is no longer paid to claimantswho build or purchase their own homes. Claimants who were previouslygranted the tax concession for home owners will continue to receivesupplementary child benefit for the remainder of the eight-year period.
Parental leaveParents can only take parental leave (Elternzeit) if they are already inemployment.If they wish, both parents can take parental leave simultaneously for all orpart of the maximum term of three years each per child. Alternatively,
-7-parents may choose to use it solely for the partner months allowed in conjunction with parental benefit(Elterngeld). However, if both parents claim their entitlement at the same time it must be remembered thatthis does not constitute an entitlement to welfare benefit, i.e. the parents must ensure that they canprovide for themselves during the period of joint parental leave. With their employer’s consent, either orboth parents can put off up to a year of their respective parental leave to between the child’s third andeighth birthday. Parents who meet the conditions may work up to 30 hours a week while on parentalleave. Parents are entitled to work part-time for between 15 and 30 hours a week if they have been withtheir employer for more than six months, the employer regularly employs more than 15 people, thereduction in working time to the stated number of hours is to be for at least two months, and there are nocompelling operational grounds opposing the arrangement. Parents have the right to reinstatement oftheir prior working hours on termination of parental leave. The employer must be given seven weeks’notice before the beginning of parental leave. The entitlement to take a reduction in working hours mustbe claimed by giving notification no later than seven weeks before beginning part-time work.Special protection from dismissal begins eight weeks before parental leave starts, or on the date ofnotification if the employer is notified less than eight weeks in advance. It continues until the end of thereported parental leave.
The lawThe law on parental benefit and parental leave is set out in a German-language brochure, ‘Elterngeld undElternzeit’ (‘Parental Benefit and Parental Leave’). Further information is available by calling the serviceline run by the Federal Ministry for Family Affairs, Senior Citizens, Women and Youth, on 030 20179130(9 am to 6 pm).
Maintenance advanceBenefits and conditionsBy way of special help for single parents, the Maintenance Advance Act (Unterhaltsvorschussgesetz)stipulates that a minimum level of child maintenance, less child benefit for the first child, will be paid frompublic funds where children receive no maintenance or no regular maintenance from the other parent.Maintenance advance (Unterhaltsvorschuss) is available for children up to 12 years old, and is paid for amaximum of 72 months. The amount paid is the standard rate of maintenance (as stipulated in Section1612a (1) of the German Civil Code (BGB) less half the child-benefit rate for a first child.Accordingly, the monthly maintenance advance as of 1 January 2010 is as follows:For children aged under 6 years:€133For children aged 6 to 11 inclusive:€180Important: You are barred from claiming maintenance advance as a single parent if you fail to giveinformation about the other parent, or fail to help identify the father or locate the other parent. Thiscontinues to apply if you still live with the other parent or if you remarry.
Supplementary child allowanceParents are entitled to supplementary child allowance (Kinderzuschlag) for each child up to age 25 if:They claim child benefit for the child;They earn at least the minimum income threshold of€900before deductions for a couple or€600before deductions for a single parent;They do not exceed the maximum income limit;The supplementary child allowance prevents need of assistance as defined in Book II of theSocial Code.Supplementary child allowance is limited to€140per child. Supplementary child allowance and the€184a month child benefit together meet the average needs of a child. At the applicable income levels,housing needs are covered by housing benefit.
-8-If the parents’ income or assets just meet their personal subsistence level, the supplementary childallowance is paid in full. Deduction of income from supplementary child allowance begins on reaching theassessment limit. For incomes between the minimum income limit and the assessment limit,supplementary child allowance is normally paid in the full amount. Once the parents’ income reaches theassessment limit, the supplementary child allowance is reduced by 50 percent of the amount by whichtheir earned income – and by 100 percent of the amount by which any other income they may have –exceeds the assessment limit. The extent to which income and assets are taken into account is mostlydetermined as for unemployment benefit II.Children’s income is always deducted in full from the supplementary child allowance.From 1 January 2011, in addition to the maximum of€140per child in cash benefit, recipients ofsupplementary child allowance are also entitled to seven types of education and participation assistance:Single-day school/daycare centre outings (actual cost)Multiple-day school/daycare centre trips (actual cost)Personal school supplies (€100 per year in total)Pupils’ transportation to/from school (actual cost)Learning support (actual cost)Participation in school/daycare centre communal meals (grant)Participation in the social and cultural life of the community, such assports clubs and music lessons (€10 per month)A German-languagepamphlet on parental benefitand parental leave(Elterngeld und Elternzeit) isavailable free of charge from:Publikationsversand derBundesregierung,Postfach 481009,18132 Rostock, Germany.Further information isAvailable at: www.bmfsfj.de
The package includes cash and non-cash assistance. The non-cash parts of the package guarantee thatthe assistance reaches those it is meant for, as assistance for the individual child or adolescent. Theassistance is handled by a single local government agency in each area, ensuring that it is locallyadministered in a targeted, accessible and unbureaucratic way. This ensures that it gets to the childrenwho need it.Supplementary child allowance is applied for in writing from the local family benefits department.The legal provisions are contained in the Federal Child Benefit Act (Bundeskindergeldgesetz).If you have further questions, please contact the family benefits department at your local employmentagency.
The lawThe relevant law is contained in the Federal Child Benefit Act of 28 January 2009 (BGBl. I, 142, 3177) aslast amended by Article 9 of the Act dated 7 December 2011 (BGBI. I p. 2592).
InformationInformation is provided by the Federal Employment Agency’s family benefits offices (Familienkassen).This is also where applications are made. A German-language leaflet on supplementary child allowance,“Kinderzuschlag”, is available free of charge from the Federal Ministry for Family Affairs, Senior Citizens,Women and Youth, 53107 Bonn, Germany.
Federal parental benefitParental benefit is an important source of support for families in the first twelve (or fourteen) months oftheir child’s life. The benefit cushions the loss of earnings after the birth of a child. Parental benefitconsequently makes it easier for mothers and fathers to take a break from or cut down on paid work inorder to take time for a child.
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Conditions for claimingMothers and fathers can claim parental benefit if they:Look after and raise their children from birth themselvesDo not do more than 30 hours’ paid work a weekLive with their children in one householdHave a place of residence or are normally resident in GermanySpouses and civil partners who look after a child from birth can receive parental benefit under the sameconditions even if the child is not their own.Parental benefit is also paid for up to 14 months for adopted children and children taken in with a view toadoption. The 14-month period begins when the child is taken into the household. Any remainingentitlement lapses with the child’s eighth birthday. In the event of the parents’ severe illness, severedisability or death, parental benefit can be claimed by first, second and third-degree relatives (brothersand sisters, uncles and aunts, grandparents and great-grandparents) and by their spouses or civilpartners.There is no entitlement to parental benefit for parents or otherwise entitled couples whose joint taxableincome exceeded€500,000in the calendar year before the birth of the child. For single parents, theentitlement ceases at upwards of€250,000.Under EU law, nationals of other EU/EEA member states and Switzerland can generally claim parentalbenefit if they live or work in Germany.Other foreign nationals can claim parental benefit if their stay is likely to be long-term based on the type ofresidence permit they hold and whether they are allowed to work. Holders of a permanent settlementpermit (Niederlassungserlaubnis) satisfy the conditions for claiming automatically. Holders of a residencepermit (Aufenthaltserlaubnis) only meet the conditions for claiming if they have a German work permit orhave already legally worked in Germany. Holders of a residence permit issued in case of hardship, for theholder’s temporary protection, under a stay of deportation or because of circumstances preventing theholder’s departure can only claim parental benefit if they have been resident in Germany for at least threeyears and are in employment or receiving unemployment benefit.
Benefit amount and durationParental benefit cushions the loss of the income that the parent looking after a child had in the yearpreceding the child’s birth and no longer has following the birth. The benefit replaces 65 percent of a priormonthly income of€1,240or higher, 66 percent of a prior monthly income of€1,220and 67 percent of aprior monthly income of between€1,000and€1,200.For low earners with a monthly income of less than€1,000prior to the child’s birth, the percentage rises up to 100 percent on a sliding scale: the lower theincome, the higher the percentage. The minimum amount of parental benefit is€300and the maximumamount is€1,800.The minimum amount of€300is paid to all entitled parents, even if they were not in employment prior tothe child’s birth. Families with two or more children can receive a bonus equal to 10 percent of theirparental benefit entitlement, or€75,whichever is greater. For multiple births, parental benefit increasesby€300a month for the second and each additional multiple birth child.Each individual parent can claim a minimum of two and a maximum of twelve months’ benefit. A child’stwo parents can claim a total of twelve months’ benefit between them. The benefit is paid for months ofthe child’s life (as opposed to calendar months). The entitlement is supplemented by two additionalmonths’ benefit if both parents claim and their earned income is reduced for two of the months for whichbenefit is claimed.Parental benefit is deducted in full, as income, from unemployment benefit II, social assistance andsupplementary child allowance. However, parents who receive these benefits but were in employmentprior to the birth of their child are entitled to an exempt amount. The exempt amount corresponds to theprior income subject to a maximum limit of€300per month. Up to this amount, parental benefit is notdeducted from these benefits and so remains at the parents’ disposal.
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InformationResponsibility for administering parental benefit under the act lies with agencies designated by theGerman states (Länder):Baden-Württemberg: Landeskreditbank Baden-WürttembergBavaria: the local Zentrum Bayern Familie und Soziales (pensions and family welfare centre)Mecklenburg-West Pomerania and Hessen: the local Versorgungsamt (war pensions office)Berlin and Rhineland-Palatinate: the local Jugendamt (youth welfare office)Brandenburg: the Landkreise (district administrations)Hamburg: the local Einwohneramt (citizens registration office)Bremen: the Amt für Soziale Dienste (social services office)Bremerhaven: the Amt für Familie und Jugend (family and youth welfare office)Lower Saxony: the local councilNorth Rhine-Westphalia, Saxony, Saxony-Anhalt and Thuringia: the Kreise/Landkreise andkreisfreie Städte (district administrations and urban municipalities)Saarland: the Elterngeldstelle (parental benefit office) at the Ministry of Labour, Families,Prevention, Social Affairs and SportSchleswig-Holstein: the local offices of the Landesamt für Soziale Dienste (state social services)Further information on parental benefit is provided in a German-languagebrochure, ‘Elterngeld und Elternzeit’ (‘Parental Benefit and Parental Leave’).This is available free of charge from Publikationsversand der Bundesregierung,Postfach 48 10 09, 18132 Rostock, Germany. Email:[email protected]The legal framewor forparental benefit and parentalleave is the Federal ParentalBenefit and Parental LeaveAct (Bundeselterngeld- undElternzeitgesetz). Informationon this is set out in aGerman-language brochure,‘Elterngeld und Elternzeit’(‘Parental Benefit andParental Leave’). Furtherinformation is available bycalling the service line run bythe Federal Ministry forFamily Affairs, SeniorCitizens, Women and Youth,on 030 20179130 (9 am to 6pm).
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Protection of working mothersMutterschutzDuring pregnancy, working women and their children need extra protection againstdangers, overwork and workplace health hazards. This protection is provided by theProtection of Working Mothers Act, which forms an essential part of the law on healthand safety. Alongside federal parental benefit and parental leave, the protection ofworking mothers is also an important part of family and social policy.
OverviewAs a working expectant mother, you enjoy special protection from workplace hazards and are protectedfrom dismissal from the beginning of your pregnancy to four months after the birth. Statutory maternityleave of six weeks before and eight weeks after confinement means you can dedicate yourself to yourfamily and recover without the added burden of employment. The statutory period of maternity leave isextended to 12 weeks after a multiple birth and longer after a premature birth (e.g. birth weight under2,500 g) (the portion of leave ‘lost’ due to a premature birth is added to the 12 week extension period).The eight-week statutory leave period is also extended by the portion of leave lost through an earlydelivery.Under certain circumstances, you may receive maternity benefit and the employer’s contribution tomaternity benefit during this period. Eligibility for maternity benefit depends on the type and scope of yourhealth insurance cover. From the birth of the child, parents can claim parental benefit and parental leave(at the same time if so desired). For more information on this topic, please see the Child Benefit, FederalParental Benefit, Parental Leave, Maintenance Advance and Supplementary Child Allowance chapter.With the exception of maternity benefit and the employer’s maternity benefit top-up payment, statutorybenefits for the child are provided as of the birth. If you find yourself in need while pregnant, visit yournearest pregnancy advice centre (Schwangerenberatungsstelle), where you can apply for help from thenational mother and child foundation, Bundesstiftung Mutter und Kind (help is conditional on a theapplication being made before the birth).
Your rights under the Protection of Working Mothers ActProtection from dismissalYour employer cannot normally dismiss you while you are pregnant or within four months of your child’sbirth.Dismissal is only possible in exceptional cases, subject to prior approval of the relevant supervisory body(usually the labour or health and safety inspectorate).Full protection against dismissal was introduced for home helps in 1997.Only the employer is prevented from giving notice. You yourself are free to terminate your employment atany time during pregnancy and the statutory period of maternity leave after the birth. You do not have toserve a notice period, and the termination of employment is effective from the end of the statutory leaveperiod. If you want to terminate your employment at an earlier or later date, however, you must observethe statutory or agreed period of notice.You have further protection from dismissal if you take parental leave at the end of the statutory leaveperiod. This protection begins eight weeks before parental leave starts – or on the notice date if you notifythe employer less than eight weeks in advance – and ends with your parental leave. Exceptions may beallowed in special circumstances. You yourself can terminate your employment in either of two ways:Either with three months’ notice to the end of your parental leaveOr at any time during or after your parental leave, provided that you observe the statutory,collectively agreed or contractual period of notice
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Workplace facilitiesAs an expectant or nursing mother you are entitled to a workplace in which youand your child are adequately protected against health and safety hazards. Youremployer must ensure this protection against health and safety risks byproviding you with appropriate workplace facilities, including safe machinery,equipment and tools, and by taking any other precautionary measures that maybe necessary.For example, if you are an expectant or nursing mother and your job requiresthat you stand all the time, under the Protection of Working Mothers Act youremployer must provide you with a place for you to sit down from time to time. If,on the other hand, you are required to sit all the time, your employer must allowyou to take short breaks.
Who is entitled toprotection?The Protection of WorkingMothers Act covers all(expectant) mothers; that is:Full-time workersPart-time workersHome helpsHome workersPublic service part-timeemployeesPeople in marginalemploymentTraineesYour nationality is irrelevant.The only requirement is thatyour place of work must be inGermany.Housewives and self-employed women are notentitled to protection underthe Act (though they canclaim maternity benefit at thesame rate as sickness benefitif they have paid sufficientvoluntary contributions into astatutory health insurancefund). Housewives and self-employed women can,however, claim parentalbenefit (see the Child Benefit,Federal Parental Benefit,Maintenance Advance andSupplementary ChildAllowance chapter). Specialprovisions apply for tenuredcivil servants and soldiers.
Protection has priorityExpectant and nursing mothers are not allowed to perform certain tasks at work.The Act lists a number of generally prohibited activities.Generally, expectant and nursing mothers may not:Perform heavy physical workPerform tasks that expose them to health risks from noxioussubstances, radiation, dust, gases, vapours, heat, cold, dampness,vibration or noiseDo pieceworkDo any other work where pay is linked to working speedDo assembly-line work involving a set working speedPerform tasks that involveRegularly moving or transporting loads over 5 kg, or occasionallymoving or transporting loads over 10 kg, without mechanical aidFrequent and considerable stretching or bendingContinual squatting or stoopingHeightened risk of accident from slipping, tripping or fallingExposure to risks of occupational diseaseWork on machinery or equipment (such as foot-operated machines)whose operation places heavy strain on the feetWork more than 8½ hours a day or 90 hours in any two consecutive weeksWork at night (between 8 pm and 6 am)Work on Sundays or public holidays
There are exceptions to the general ban on night and Sunday working (see ‘Special provisions’, below).Regular work driving transport vehicles is not allowed after the third month of pregnancy. For example,you cannot then drive a bus, lorry or taxi. This also applies to sales representatives who spend more thanhalf their working hours on the road. After the fifth month of pregnancy you may not do work that requiresyou to stand for more than four hours a day unless broken up by periods of sitting or walking.You may also be personally banned from performing certain tasks on medical grounds. Besides theprohibited activities listed above, you cannot continue to perform your usual work without making anychanges if a medical examination shows that doing so would endanger your health or that of your child.Your employer might then assign you other work on the same pay. In certain cases, a reduction inworking time may suffice.A ban on medical grounds is different from a sick note. You will not lose any pay, because you areentitled to maternity pay from your employer (not to be confused with maternity benefit and theemployer’s contribution to maternity benefit during the statutory period of maternity leave), which in mostcases is at the same rate as your average take-home pay. Your employer is refunded this expenditure(pay during maternity leave and the employer’s contribution to maternity benefit) out of contributions paidby all employers.
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The lawThe law on the protection of working mothers is set out in the Protection of Working Mothers Act(Mutterschutzgesetz) and in Book V of the Social Code (SGB V). The Farmers Health Insurance Act(Gesetz über Krankenversicherung für Landwirte) also has provisions on maternity benefit. These lawsare implemented by state supervisory authorities.
InformationA German language pamphlet on the protection of working mothers (Leitfadenzum Mutterschutz) is available from the Federal Ministry for Family Affairs,Senior Citizens, Women and Youth, and can be downloaded from theministry’s website at www.bmfsfj.de. Information on protection of workingmothers is also available by calling the service line operated by the FederalMinistry for Family, Senior Citizens, Women and Youth, on 01801 907050from Monday to Thursday (9 am to 6 pm).
A German-languagepamphlet on the protection ofworking mothers (Leitfadenzum Mutterschutz) isavailable free of charge from:Publikationsversand derBundesregierung,Postfach 48 10 09,18132 Rostock, Germany.Further information isAvailable at: www.bmfsfj.de
If you are not insured, please contact the Bundesversicherungsamt (Federal Insurance Office), Friedrich-Ebert-Allee 38, 53113 Bonn; Tel. 0228 619-1888. If you are unemployed, your local employment agency(Agentur für Arbeit) is available to provide information and advice.Depending on your income, you may be able to claim help under the legal aid system from the local court(Amtsgericht).
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Promotion of employmentArbeitsförderung
Book III of the German Social CodeAs many people as possible should have work. The employment promotion policies enacted in Book III ofthe Social Code aim to achieve this by improving the earnings prospects of people without work and bymatching up supply and demand on the labour market. These policies are implemented by the FederalEmployment Agency in Nuremberg (Bundesagentur für Arbeit) and its local employment agencies(Agenturen für Arbeit).
Tasks and benefitsThe main tasks of the Federal Employment Agency are:Careers guidance and orientationAdvice on the jobs market in generalJob and traineeship placementImproving people’s chances on the jobs marketIntegrating people into employment in other waysIncome replacement benefitsEmployer guidanceThe Federal Employment Agency provides services both to employees and employers.You are entitled to some of these services whether or not you have paid unemployment insurancecontributions. These include careers guidance and orientation, and job and traineeship placement. Toreceive other help—such as unemployment benefit—you need to have been in work and paying statutoryinsurance contributions in the past.
Advice and placementCareers guidanceCareers guidance targets both young people and adults. It involves the provision of advice andinformation concerning career choice, occupations and the respective requirements, funding options forvocational education and training, important developments in the working world, the situation andexpected trends in the jobs market, and finding a training place or permanent job.For young people wanting to study at college or university, the careers advice officers at localemployment agencies provide a specially designed advisory service for those leaving school with acertificate of higher education (Abitur). They advise on choosing a course of academic study, explain theacceptance requirements and what is expected of students on particular courses, outline the jobopportunities and go through the various funding options. They work with young people to identify theirpersonal goals, employment options and possible alternatives.
Career orientationSystematic career orientation can help people in choosing an occupation and thus positively influence thecareer paths of young and old alike. It can also aid the careers guidance process by providing in-depthinformation on issues concerning career choice, occupations, job requirements and opportunities, routesinto a chosen career path, funding for vocational training and education, and work-related developmentsin business, local administrations and the jobs market in general. The service includes visits to schools totalk with 12th and 13th graders, career orientation events in careers information centres(Berufsinformationszentren, or BIZ) and online and print media published by the Federal EmploymentAgency (BA).
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Labour Market Advisory ServiceThe labour market advisory service provided by the local employment agencies targets employers and isdesigned to support them in filling trainee places and vacant positions. Employers are informed about thecurrent situation in the labour market, expected trends and available occupations. They are schooled injob structuring, employment conditions, working hours, on-the-job training and education, and integrationof hard-to-place trainees and employees.
Vocational training and work placementAnyone seeking work can use the services of an employment agency, whether they are unemployed, areabout to lose their job or are looking for a career change. Young people seeking vocational training arealso entitled to assistance. Work placement is the employment agencies’ main task. The remainingbenefits and assistance services for employment promotion are only provided where long-term integrationinto the labour market or the vocational training market cannot succeed without them.As soon as you know when your current employment will come to an end, you are automatically requiredto register in person at your local employment agency. Registration must take place at least three monthsbefore your employment is due to end. If the time between receiving your notice and your last day of workis shorter than three months, you must report to the employment agency no later than three days afterreceiving your notice. To comply with the deadline, you may register by telephone on the condition thatyou make an appointment to register personally afterwards.
Placement assistancePlacement budgetPlacement guidance and assistance provided via the placement budget take a flexible, targeted andneeds-oriented approach to removing potential obstacles while also taking account of the specific needsof people looking for work or vocational training. It is designed to help people looking for a trainingplacement, those facing unemployment and those out of work to find and take up insurable employment.The placement budget thus offers broad scope in promoting individual employment or training prospectsto ensure the right type of assistance is provided in each case. Accordingly, rather than applications forassistance being governed by detailed legal requirements, placement and advisory staff look at eachcase individually to assess the specific type of support and assistance that can be applied for from theplacement budget.Conditions under which placement assistance may be approved:You are facing unemployment, seeking work or are unemployed and wish to take up insurableemploymentYou are looking for a training placement that provides insurable vocational trainingYou are receiving basic security benefits for job-seekers and are wanting to improve youreducational qualificationsYou are eligible to receive assistanceYou need help in overcoming obstacles in seeking and taking up insurable employment orvocational trainingThe amount claimed from the placement budget is commensurate with the services providedThe employer does not provide similar assistanceOther public agencies are not legally obliged to provide similar servicesYou apply for placement assistance before costs are incurredYou understand and acknowledge that placement assistance is a discretionary service to whichyou have no legal right
Guidance and placement assistance may also be provided to help in searching for or taking up a trainingplacement or offer of work in another EU member state, in a Signatory State to the Agreement on theEuropean Economic Area (EEA) or in Switzerland. This is based on the condition of a minimum of 15hours of training or work per week.
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Improving prospects for integrationThese measures include training courses and practical activities that aim to improve the prospects ofthose seeking vocational training, the unemployed and those facing unemployment and seeking newwork for integration into the labour market. They can be used to assess a person’s readiness and abilityto work, to identify, alleviate and reduce obstacles to their entering the labour market, to place them in anemployment relationship in which they pay compulsory contributions, assist them in becoming self-employed or stabilise their employment prospects.Costs of taking part in the measures are paid for up to a reasonable amount. Unemployment benefitcontinues to be paid if the person is entitled to it.The duration of the measures provided must be commensurate with their purpose and content. Themeasures may also be provided by employers, either in whole or in part, up to a maximum period of sixweeks.Participation is proposed or approved by the local employment agency. The employment agency cancommission providers to carry out measures directly or issue the entitled person with an activation andplacement voucher. The decision is made by the employment agency based on the aptitude and personalcircumstances of the entitled individual and the measures available in the local area. In somecircumstances, unemployed persons are entitled to an activation and placement voucher allowing them touse a private job placement service at the employment agency’s expense.
Help becoming self-employedStart-up grantsHow to claimWorkers who end their unemployment by taking up self-employment as a main occupation may receive astart-up grant (Gründungszuschuss) to cover living expenses and social insurance contributions for thefirst few months of self-employment.The start-up grant can be made available to workers who still have at least 150 days’ entitlement tounemployment benefit on entering self-employment. To qualify for the grant, applicants must demonstratethat they have the necessary knowledge and skills to carry out the occupation concerned. They must alsopresent to the employment agency a statement from a knowledgeable authority that their self-employment is potentially sustainable. This statement can be provided by various bodies, includingchambers of commerce, guilds, industry associations and banks.A start-up grant is not made available if there are or would be grounds for the applicant’s entitlement tounemployment benefit to be suspended under sections 156-159 of Book III of the German Social Code(SGB III). Claimants who reach pensionable age for a standard old-age pension while still receiving thegrant cease to receive it from the beginning of the next month. The grant is not available for 24 monthsafter the end of a grant of assistance with entering into self-employment under SGB III.
Amount and durationThe start-up grant is paid out in two phases. For the first six months, self-employed start-ups can receivea grant matching their last unemployment benefit to cover living expenses plus€300a month for socialinsurance. The€300a month for social insurance can be paid for a further nine months if the claimantcan demonstrate that they are actively trading and working for the business on a self-employed basis astheir main occupation.
Initial financial supportIndividuals who are entitled to assistance and claim basic security benefits for job-seekers under Book IIof the Social Code (SGB II) can receive initial financial support (Einstiegsgeld) to help them enter self-employment as a primary occupation or an employment relationship in which they pay compulsorycontributions. The support is provided by the local job centre.
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How to claim/amountThe initial financial support can be granted as a supplement to basic security benefits for job-seekers ontaking up self-employment as a primary occupation or an employment relationship in which compulsorycontributions are paid. There must be reasonable grounds to expect that the employment or self-employment will remove the need for assistance.The amount of initial financial support is based on factors such as the length of unemployment and thesize of the claimant’s household. The amount therefore varies from case to case. The grant is made for amaximum of 24 months. There is no legal entitlement to initial financial support.
Other assistance for self-employed individualsIndividuals who are entitled to assistance and who take up self-employment as a primary occupation canalso receive loans or grants for the purchase of material resources (grants are limited to a maximum of€5,000).The material resources must be necessary and reasonable for the form of self-employment inquestion. Individuals who are entitled to assistance and are self-employed can also receive assistance forexternal advice and training in order, for example, to place the self-employed business on a more stablefooting or to effect a change in focus. The assistance is, however, subject to the self-employment beingeconomically viable. There is no legal entitlement to the assistance.
Choice of occupation and vocational trainingPromotion under Book III of the Social Code (SGB III)Choosing the right occupation is a difficult challenge for young people. Support in the choice of career istherefore decisive in ensuring a successful transition from school to vocational training and work. Initialvocational training in particular is becoming increasingly important in the jobs market due to the sharpdrop in the number of jobs available for unskilled and semi-skilled workers. Employment promotionpolicies thus offer a variety of opportunities to assist young people in their search for vocational training:
Career orientation eventsEvents can be held to provide secondary schools students with in-depth career orientation and help withpreparing to choose a career. At least 50 percent of the cost must be met from another source. For fourweeks in the school holidays, students can gain a detailed insight into the various occupations, what theyrequire and their prospects. When planning the events, it must be ensured that they meet requirementsfor students with special educational needs and severe disabilities.
Integration supportSeamless transition from school to vocational training is the best start to working life. Providing one-on-one support, integration assistants help secondary school students with support needs for a periodbeginning two years prior to the date of school leaving exams and usually ends six months aftervocational training begins. If the transition into training takes longer, the support is extended up to amaximum of 24 months after the student leaves school. To enable as many young people as possible tomake this transition, the German government’s Act to Improve the Chances of Integration in the LabourMarket (Gesetz zur Verbesserung der Eingliederungschancen am Arbeitsmarkt) makes an integrationprogramme initially run as a pilot scheme at some 1,000 secondary schools available nation-wide andpart of an indefinite service to be provided under Book III of the Social Code. The program is nowestablished as a transition aid for secondary school students with support needs.In light of the fact that responsibility for integration support is shared between the Federal and Länder(state) governments, third-party co-financing in the amount of 50 percent will be needed in future,whereby the German states will be largely responsible in this regard.
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Pre-vocational training schemes (BvB)Young people who are unable to enter into vocational training for whatever reason can be given grants byemployment agencies to take part in pre-vocational training schemes. These serve career orientation,career choice and targeted preparation for vocational training.In future, co-financing of small-scale, production-oriented measures will be available for pre-vocationaltraining schemes.Under the pre-vocational training scheme, young people who have left school have a right to receivesupport in pursuing further education to attain a school leaving certificate (Hauptschulabschluss).
Entry qualificationsEntry qualifications received in initial practical training give young people with limited placementopportunities new perspectives for entering into vocational training. They also build bridges for youngpeople who do not yet have the skills required for entry into a vocational training or who have learningdifficulties or are socially disadvantaged.
Type of scope of promotionUnder the programme, employers who take on young workers in a pre-vocational training position forbetween six and twelve months receive€216per month plus a combined amount for social insurance.
Vocational training grants (BAB)RequirementsYoung people taking part in pre-vocational training schemes and those in vocational training may receivea vocational training grant if the resources they need to cover their living expenses are not alreadyprovided elsewhere. This support is similar to Federal Education Assistance (BAföG) but is financed fromsocial insurance contributions. The Federal Employment Agency offers vocational training grants(Berufsausbildungsbeihilfe) to trainees who are unable to live at home with their parents during theirtraining because the training venue is too far away.Under certain circumstances, vocational training grants (BAB) may be provided for a subsequent courseof vocational training where it is considered appropriate. Despite having completed their vocationaltraining and possessing the associated qualifications, some young people still lack employmentopportunities in their chosen occupation. A second course of vocational training that would improve theiremployment prospects should not be jeopardised because a young trainee or apprentice lacks thefinancial means to cover their living expenses.Since 1 January 2009, foreigners who have a temporary suspension of deportation (‘Duldung’) and areresident in Germany may receive assistance while receiving on-the-job vocational training with anemployer provided that they have been in the country either legally or subject to permission to remain(‘Aufenthaltsgestattung’) or to temporary suspension of deportation for at least four years withoutinterruption.
Type and scope of promotionThe amount of the grant depends on the type of accommodation involved, the amount of pay the traineereceives and the annual income earned by the trainee’s parents, spouse or civil partner. In some cases,living expenses, travel expenses, child care costs and outlay for educational materials and workingclothes can be taken into consideration on a lump-sum basis.Vocational training grants are also used to promote participation in pre-vocational training schemes. Insuch cases, course costs, travel expenses, child care costs and outlay for educational materials andworking clothes are reimbursed directly regardless of how much the trainee earns.
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Educational supportIn certain circumstances, trainees can receive additional educational support in the form of additionaltuition or social education assistance during vocational training in a company or while working towardsentry qualifications.
Vocational training in training institutesYoung people who for reasons relating to their own person are unable to enter into a traineeship with acompany can receive additional help in commencing and even completing vocational training in a state-recognised training occupation at a training institute and thus gain a recognised vocational qualification.
Promotion of further vocational trainingHow to claimIf you take part in further training activities, you can claim a vocational training grant ifYou are unemployed and further vocational training will assist your integration into the labourmarket, is necessary to avoid possible unemployment or if it becomes apparent that training isneeded to compensate for a lack of initial vocational training.You have taken part in an advisory session at the employment agency prior to trainingThe training measures are approved and the training provider is accredited.
Type and Scope of PromotionEducation vouchers (Bildungsgutschein) are issued to all entitled workers. The voucher is usuallyallocated for a specific educational goal and is limited to a particular geographic area. It allows anyoneinterested in further training to choose an accredited training provider offering the appropriate form oftraining. The employment agency provides information on available occupational training measures (forexample via the KURSNET online database). Selection of the actual accredited training provider liessolely with the voucher holder. The education voucher must be handed over to the training provider whobills the employment agency directly.If you enter into further training, the employment agency can assume the following costs:Course costs (course fees, including the costs of educational materials, working clothes, examfees for state or generally recognised interim and final exams, partial exams) and any costsarising from having to take part in aptitude testing (say a health check) prior to starting thetraining course.Travel expensesAccommodation and meals expenses at a training centre that is too far away for you to live athome.Child care costs (€130 per child).
Special vocational training schemes are also in place for people already in work.
1. Further on-the-job training for low-skilled and older workers (WeGebAU) isavailable for:Low-skilled workers with no school qualifications or with school qualifications but who were eithertrained on the job or perform unskilled work and have done so for at least four years and can nolonger work in the job they originally trained for. Periods in unemployment, child-rearing or caringfor a relative are taken into account.Workers aged 45 and over who are employed by an employer with a workforce of less than 250provided that the employer continues to pay wages for the duration of the training.Until the end of 2014, all other workers who are employed by an employer with a workforce ofless than 250 provided that the employer both continues to pay wages and also meets at least 50percent of the cost of the training.
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Further training measures can involve those which:Provide knowledge and skills which can generally be used in the employment marketLead to a recognised occupationConclude with a certified partial qualification or a cross-industry or cross-sectoral qualificationEmployees wishing to take advantage of the scheme receive education vouchers which allow them tochoose from recognised further education and training courses.Assistance takes the form of the cost of training being met in full or part. In the case of low-skilled workerswho are released from work with full pay, the employer receives a grant to help cover the employee’s pay.
2. Training while receiving transfer short-time allowanceThe Federal Employment Agency can make use of European Social Fund resources to meet the cost ofparticipation in training for workers receiving transfer short-time allowance. The facility is provided forclaimants of transfer short-time allowance who are registered with their local Employment Agency asseeking work and for whom skills deficits have been identified in measures to determine integrationprospects.The cost of training courses is funded provided it is reasonable and the employer makes a suitablecontribution towards funding. If travel costs are incurred, trainees can be granted a travel allowance of€3each per day of training provided that the employer/transfer entity takes charge of accounting and payout.Further information about this training scheme is available from the employers’ service office at localemployment agencies.
Labour market support for people with migrant backgroundsAll forms of integration assistance under Book II and Book III of the Social Code are generally available topeople with migrant backgrounds provided the legal requirements are met for being allowed to take upemployment. To provide people with migrant backgrounds with better access to labour market policyinstruments, the Federal Ministry of Labour and Social Affairs, the Federal Ministry of Education andResearch and the Federal Employment Agency began in mid-2011 to expand the “Integration durchQualifikation (IQ)” (“Integration through Training”) funding programme into a national structure of regionalnetworks. One of the main tasks of the regional networks is to provide training to enhance the interculturaland immigration-related skills of counselling staff at local services (such as employment agencies and jobcentres) and to link up the various forms of assistance available in each region into a process chain. Theregional networks also provide a supporting framework for implementation of new legislation to improvethe assessment and recognition of foreign occupational qualifications that entered into force on 1 April2012. This involves the creation of regional points of contact to provide initial information, to help peopleseeking recognition of their qualifications find the recognition authority responsible for them, and to referthem to other local advice services.
Advancing the labour market participation of people with disabilitiesUnder Book III of the German Social Code, people with disabilities are individuals whose prospects ofparticipating or continuing to participate in the labour market are substantially impaired, other thantemporarily, on account of a disability as defined in Section 2 (1) of Book IX of the German Social Codeand who consequently need help participating in the labour market, including people with learningdisabilities. People at risk of disability with like consequences are deemed equivalent to people withdisabilities. Under Section 2 (1) of Book IX of the German Social Code, a person has a disability if theirphysical ability, mental capacity or psychological health is likely to be impaired for longer than six monthsto the extent that they deviate from that typical for the person’s age and thus hinder their participation insociety. They are deemed at risk from disability if such impairment is anticipated.The range of general support provided under SGB III with regard to labour market participation of peoplewith disabilities comprises:Activation and occupational integration assistancePre-training and vocational training support, including vocational training grants
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Provision is also made for special measures promoting the participating of disabled people in working lifewhere needed due to the nature or severity of disability or to ensure that integration is successful. Forexample, initial and further vocational training can be provided in specially equipped rehabilitationcentres. Under Book III of the German Social Code, promotion of initial and further vocational trainingmay also take place in a workshop for the disabled.Employers can receive support in helping disabled and severely disabled people to integrate:Integration subsidy (see the Integration Subsidies section) and subsidies to reimburse the costsof vocational trainingTrial or pre-employmentWork aids
With Germany’s Supported Employment Act of 22 December 2008, a new instrument was introduced topromote the integration of disabled and severely disabled persons into the jobs market.Individuals who because of their disability and despite making use of all available support to compensatefor their disadvantages are unable to enter into vocational training, supported employment can result inthem being placed in work. Under supported employment, disabled persons with special assistanceneeds are placed in new job opportunities that meet their abilities and leanings. In line with the principle of‘placement first, training second’, they are trained and supported on the job with the ultimate aim of thembecoming permanently employed with the respective employer. This provides new opportunities on thegeneral employment market.The benefits and services governed by Section 38a SGB IX take in individual in-house training andsupported employment. In-house training is possible for a period of two and no more than three years.The provision of non-work-related learning materials, key skills and measures towards personaldevelopment are integral components of the training provided. Participants are covered under the socialinsurance scheme. Contributions are paid by the integration services, usually the employment agency. Ifcontinued support is necessary following integration into an employment relationship in which theemployee pays compulsory contributions, it is usually provided by the integration offices in the form ofsupported employment.
Wage replacement benefitsUnemployment BenefitTo receive unemployment benefit (Arbeitslosengeld), you must:be unemployedhave personally registered as unemployedhave completed the qualifying periodbe actively seeking work and be available for work.You are classed as unemployed if you have no work at all or if you work for less than 15 hours a week foran employer or on a self-employed basis.To register as unemployed you must visit the employment agency in person and report that you havebecome unemployed; you cannot register by phone or by post. You can register for a maximum of threemonths, and must renew your registration before it expires if you are likely to remain unemployed.To complete the qualifying period, you must accumulate at least twelve months (360 days) of FederalEmployment Agency contributions, either by working or otherwise (for example, by claiming sicknessbenefit), within the timeframe of the last two years.From 1 February 2006, anyone who provides home nursing care for a dependant, is self-employed for atleast 15 hours per week or is employed outside Germany in a non-EU country or in a country notassociated with the EU, may make voluntary unemployment insurance contributions. This gives people
- 22 -who are not required to pay mandatory contributions the opportunity to pay a voluntary contribution tosafeguard their entitlement to unemployment benefit. The applicant must, however, have paid mandatorycontributions at an earlier date.The amount of unemployment benefit you receive is based on your average weekly pay on whichstatutory insurance contributions were levied in the last year before becoming eligible to claim (theassessment period).The resulting gross earnings figure (gross assessed earnings) is then subject to deductions at a fixedrate. These deductions take the form of social insurance contributions in an amount of 21 percent of yourgross assessed earnings, income tax and solidarity tax.Your unemployment benefit is 67 percent of your net assessed earnings (gross assessed earnings afterdeductions) if you have at least one child who you can claim tax relief for, and 60 percent if you do not.How long you can claim unemployment benefit for depends on your age and how long you have been incontributory employment within the reference period (which has been extended by three years) and yourage at the time you became unemployed.Entitlement periods:Minimum time payingcontributions12 months16 months20 months24 months30 months36 months48 monthsAgePeriod of entitlement6 months8 months10 months12 months15 months18 months24 months
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Any entitlement to unemployment benefit expires if you complete anotherqualifying period. Any remaining entitlement is then added to the newentitlement, up to the maximum period for your age.While you are drawing unemployment benefit, the employment agency pays your statutory healthinsurance, long-term care insurance and pension contributions. The benefit is transferred at the end ofeach month onto a bank account you specify.
Short-time allowanceIf an employer temporarily cuts working hours and puts the workforce on short time because business isslack or due to an unavoidable event, the local employment agency pays a short-time allowance(Kurzarbeitergeld) subject to the meeting of statutory requirements. The main purpose of short-timeallowance is to keep workers in employment and avoid redundancies despite a lack of work.You can claim the short-time allowance if:You are on reduced pay or receive no pay at all due to a cut in working hoursThe cut in working hours is temporary and substantialPersonal requirements have been met (especially in the case of non-terminated, insurableemployment)The employer or works council reported the cut in hours in writing without delay to the localemployment agency
A cut in working hours is deemed substantial if:It is caused by economic reasons, such as an economic slowdown, or an unavoidable event(such as flooding)It is temporaryIt is unavoidable
- 23 -During the period of eligibility (the current calendar month), at least one-third of the employees inthe company concerned received 10 percent less pay due to a cut in working hours. The loss ofpay can also amount to 100 percent of the monthly gross wage.
A cut in working hours is temporary if there is a certain probability of a return to full-time working withinthe period for which the allowance is granted.A cut in working hours is deemed avoidable if:It is normal for the sector or workplace or is seasonal, or is solely for organisational reasonsIt can be avoided by granting paid leave, provided that it does not conflict with higher-priorityemployee preferences regarding when to take leaveIt can be avoided by exploiting flexible working hours arrangements permitted at the workplace inquestionThe allowance is usually paid out by the employer and refunded by the local employment agency onapplication by the employer or works council.The size of the short-time allowance is based on the amount of pay lost, net of deductions. You normallyreceive 60 percent of the net pay lost. If at least one child lives in your household, the short-timeallowance is 67 percent of the net pay lost. The difference in net pay is calculated on the basis of thegross pay that would have been received had there not been a cut in working hours and the actual grosspay received as a result of short-time work and in line with the provisions of applicable law (Verordnungüber die pauschalierten Nettoentgelte für das Kurzarbeitergeld). The difference between both netamounts is paid out as short-time allowance in amount of 67 or 60 percent. The calculation does not takeaccount of any changes in the agreed working hours made under collectively bargained guaranteedworking hour agreements.The allowance is granted for a statutory period of six months. This can be extended by order of theFederal Ministry of Labour and Social Affairs. For claims submitted on or before 31 December 2013, theperiod of entitlement is 12 months.How to claimShort-time allowance is paid at the request of the employer or the works council. The application must besubmitted to the responsible Employment Agency within a period of three months. The three-monthperiod begins at the end of the calendar month (entitlement period) containing the days for which short-time allowance is claimed.
Insolvency allowanceInsolvency allowance (Insolvenzgeld) is paid if your employer becomes insolvent and you have notreceived all outstanding pay.You can claim insolvency allowance if you are owed pay from the last three months you worked: beforeinsolvency proceedings started, before a petition to start insolvency proceedings was dismissed onaccount of insufficient assets, or if your employer has not filed for insolvency and manifestly does nothave sufficient assets to do so, before your employer finally ceased trading in Germany.Insolvency allowance covers outstanding net pay if your gross earnings do not exceed your grossassessed earnings (2013:€5,800in western Germany and€4,900in eastern Germany). The employmentagency also pays outstanding mandatory social insurance contributions (health, pension and long-termcare insurance) and unemployment contributions for the last three months.
Insolvency allowance must be applied for at the relevant local employment agency within a limitationperiod of two months after before insolvency proceedings started, before a petition to start insolvencyproceedings was dismissed on account of insufficient assets, or if your employer has not filed forinsolvency or before your employer finally ceased trading.
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Seasonal short-time allowance: Promoting all-year work in the building tradeSeasonal short-time allowance can be claimed by employees during the bad-weather season (1December to 31 March) if:They work for a building and construction companyThe reduction in working hours is significantBoth company and individual requirements for eligibility are metThe cut in working hours has been reported to the responsible Employment Agency
A building and construction company is a company which primarily provides commercial building andconstruction services in the building and construction sector. Building and construction services are allservices involved in the construction, maintenance, repair, modification and demolition of buildings andother structures. Eligible companies and non-eligible companies are listed in the regulations on winteremployment in the building and construction sector (Baubetriebe-Verordnung). Eligible companies includethe primary building and construction trade, the roofing trade, the scaffolding trade and the landscapegardening trade.To be eligible, a company must employ at least one employee.A cut in working hours is deemed significant when it is of temporary nature and cannot be avoided due tobad weather, economic reasons or an unexpected event beyond the company’s control.Avoidable cuts in working hours include:Those caused solely as a result of business administrationThose which could be avoided by granting paid holiday where the employee’s primary holidayplans remain unaffectedThose which could be avoided if the company made use of authorized fluctuations in workinghours
If, since the last bad weather season, credits on flexible working hour accounts which are less than a yearold have been used for other purposes than to compensate for loss of pay due to a cut in working hourscaused by bad weather or because an employee was released from work for training reasons, cuts inworking hours equal to the amount accrued on the flexible working hour account are deemedunavoidable. Cuts in working hours which are customary in the industry or the company or are weather-related are deemed unavoidable.Weather-related cuts in working hours occur when the cut is exclusively caused by serious weatherevents and at least one hour of regular working time is lost in a given working day.Employees wanting to claim seasonal short-time allowance must fulfil the individual requirements.Seasonal short-time allowance is paid for the duration of the cut in working hours during the bad weatherseason (1 December to 31 March), meaning for a maximum period of four (4) months.Periods in which an employee receives seasonal short-time allowance are not counted towards the periodof eligibility for short-time allowance. Nor are they counted as a break which would lead to the start of anew eligibility period.The amount of seasonal short-time allowance is subject to the provisions which apply to short-timeallowance.Seasonal short-time allowance is paid out on application from the employer or works council. Applicationsmust be submitted within three months to the responsible Employment Agency. The three-month periodbegins as soon as the month containing the days for which seasonal short-time allowance is claimed hasthexpired. Seasonal short-time allowance should ideally be claimed no later than the 15 of the followingmonth. Applications must be submitted to the Employment Agency in the district in which the employer’spayroll office is located.
- 25 -Apart from an entitlement to seasonal short-time allowance, employees may also claim supplementarybenefit in the form of an additional winter allowance (Zuschuss-Wintergeld) and a winter expensesallowance (Mehraufwands-Wintergeld). Building and construction workers may claim a refund of theemployers’ social insurance contributions where such payments are made from a transfer fund. Thesupplementary benefits are not paid from contributions to the unemployment insurance fund, and are onlypaid in relation to employment relations that cannot be terminated on grounds of bad weather during thebad weather season. This means that supplementary benefits may be paid to trade employees, but not towhite-collar workers or polishers.Additional winter allowance (Zuschuss-Wintergeld) is paid in amount up to€2.50per lost hour of work ifthe employee’s flexible working time account is used to compensate for the lost hours and a claim forseasonal short-time allowance is avoidedWinter expenses allowance (Mehraufwangs-Wintergeld) is paid in an amount of€1.00for each eligibleworking hour worked by trade employees working at a weather-dependent location between 15December and the last day of February. Up to 90 working hours can be claimed in December, and up to180 hours in January and February.The employees’ contribution to social insurance for recipients of seasonal short-time allowance may bereimbursed upon application. The supplementary benefits are paid on application by the employer or theworks council. The period of eligibility begins immediately the calendar month containing the days forwhich supplementary benefits are claim has expired. Supplementary benefits should ideally be claimedthon or before the 15 of the following month. Applications should be submitted to the Employment Agencyin the district in which the employer’s payroll office is located.
Transfer benefitsTransfer benefits provide support during workforce adjustments following changes in a business. Thepurpose of transfer benefits is to improve the prospects of finding new employment for employeesaffected by layoffs. The aim is preferably a transfer directly from job to job without an intervening periodclaiming unemployment benefit.The decision to deploy transfer payments is the responsibility of the employer and the works council, andis taken in negotiations on a reconciliation of interests or social plan. Generally, the purpose of a socialplan is to agree on financial compensation for the losses to employees resulting from changes in abusiness (severance pay etc.).Transfer benefits aim to incentivise employers, alongside severance payments, to take an active part inthe process of reintegrating employees at risk of unemployment. Employment promotion policies makeprovision for two types of support for this purpose: Transfer programmes and transfer short-timeallowance.Entities administering transfer programmes and transfer companies in which transfer-short-timeallowance is paid must obtain authorisation as providers of benefits under Book II of the Social Code byor before 1 January 2013. Employers who establish an internal transfer company under their ownadministration do not need this authorisation.
Transfer programmesUse is made of the notice period to prepare employees affected by a change in their employer’s businessfor transfer to subsequent employment. Transfer programmes include aptitude assessment, outplacementadvice, application training, short training courses, and advice and support for becoming self-employed.Workers at risk of unemployment due to a change in their employer’s business or on completion ofvocational training are entitled to funding to take part in a transfer programme if:The employer and the works council have obtained advice from the employment agency beforedeciding to establish a transfer programmeThe programme is carried out by a third party and the employer makes a suitable financialcontribution
- 26 -The purpose of the programme is to help integrate workers into the labour marketIt is ensured that the programme will be put into effect
The employer’s commitment to provide funding can be made under a social plan or by other collective orindividual agreement. Support is generally provided for all employees, with no minimum size restriction onthe establishment in which they are employed.A grant is made in the amount of 50 percent of necessary and appropriate programme costs up to amaximum of€2,500per case. Other forms of active employment promotion assistance with similarobjectives cannot be granted during participation in a transfer programme. From 1 April 2012 to 31December 2014, programme costs can include a lump-sum success fee for placement in employmentthat lasts at least six months and in which mandatory contributions are payable. The success fee cannotexceed€1,000and is payable only once per supported employee.
Transfer short-time allowanceThe objective of transfer short-time allowance (Transferkurzarbeitergeld) is to enable workers to betransferred from their existing employment to other employment without an intervening period ofunemployment.Transfer short-time allowance can generally be granted with employees remaining under the sameemployer or under an external (transfer) company (Transfergesellschaft). For reasons concerning labourlaw, the external solution is usually preferred. Employees affected by layoffs are brought under a transfercompany under a three-party contract.While claiming transfer short-time allowance, the transfer company or employer must offer the employeesother work opportunities and if appropriate must take action to improve their integration opportunities (forexample by providing training). The cost of training measures may be subsidised with the aid of theEuropean Social Fund (ESF).The amount of transfer short-time allowance is the same as that of short-time allowance. The maximumperiod of entitlement is 12 months. Transfer short-time allowance is generally paid out by the transfercompany or employer and refunded by the responsible employment agency on application from theemployer or works council.General requirementsWorkers are entitled to transfer short-time allowance if:A major change in their employer’s business causes them to suffer a sustained unavoidable lossof working time and payCertain organisational and individual requirements are metThe employer and the works council have obtained advice from the employment agency beforedeciding to claim transfer short-term allowanceThe sustained loss of working time is reported to the employment agency by the employer orworks council
There is no entitlement if employees are merely temporarily brought under an organisationallyindependent unit before occupying a position in the same or another workplace belonging to the sameenterprise or, if the enterprise is part of a group, in a workplace belonging to another group company.Public-sector employees are also excluded with the exception of employees of enterprises incorporatedas independent entities and run on a for-profit basis.
Individual requirementsWorkers are only entitled to transfer short-time allowance if:They are under threat of unemployment
- 27 -After commencement of the loss of working time and pay, they continue an employmentrelationship in which they pay mandatory contributions or take up such employment at the end oftheir vocational trainingAre not excluded from claiming short-time allowanceBefore being transferred to an organisationally independent unit, have registered with theemployment agency as looking for work and have taken part in a measure to assess theirintegration prospects
Organisational requirementsThe organisational requirements are met if:The change in the business results in adjustments to the workforceThe affected workers are brought under an organisationally separate unit (usually a transfercompany) and taken out of the production processThe organisationally independent unit is organised and provided with resources such that it isprobable the integration objective will be achievedA quality assurance system is applied. If the organisationally separate unit is operated by a thirdparty, that party must be licensed.
Worker integrationIntegration subsidyHow to claimEmployers can receive wage subsidies to help integrate workers who are difficult to place on grounds oftheir personal circumstances. The subsidy is based on the extent to which a worker’s productivity isimpaired and the needs of the workplace.Integration subsidy is paid against the regular payments employers make in accordance with collectiveagreements or locally accepted wage rates and a fixed amount for social insurance contributions. One-offwage payments are not covered by the subsidy.
Amount and duration of subsidy paymentsThe amount of the integration subsidy may not normally exceed 50 percent of the subsidisable wage andmay be paid for no longer than twelve months. The subsidy may be paid for up to 36 months in the caseof employees over the age of 50.Special provisions apply with regard to the amount and duration of payments for disabled and severelydisabled people. In departure from the rule above, the amount can be up to 70 percent of the subsidisablewage and the duration up to 24 months. For severely disabled people with special needs, the amount canbe up to 70 percent of the subsidisable wage and the duration up to 60 months. The duration can be up to96 months for severely disabled people with special needs who are aged 55 or older.The decision as to the duration of the subsidy must take reasonable account of any other subsidisedemployment with the same employer. The decision as to both the amount and the duration also includesconsideration of whether the disabled person was employed other than by statutory obligation or in amanner that exceeds the employment obligations set out in Part 2 of Book IX of the German Social Code.
FundingMost Federal Employment Agency funding comes from contributions, though additional funds come frompay-as-you-go levies on employers and their liability funds. The contributions are paid by employers aswell as employees (white and blue-collar workers, people employed on vocational training schemes, andpeople who work from home). Their respective share of the contributions depends on the current
- 28 -contribution rate (3 percent of gross pay since 2012). The maximum contribution is set by a contributionassessment limit. The monthly limits in 2013 are€5,800in western Germany and€4,900in easternGermany.
The lawThe law on employment promotion is set out in Book III of the Social Code.The law is implemented by the Federal Employment Agency in Nuremberg (www.arbeitsagentur.de)together with its regional directorates, employment agencies and other agency offices. The FederalEmployment Agency is a self-governing public agency.
InformationFor further information please contact your local employment agency. You can also find a wide range ofinformation at http://www.arbeitsagentur.de.
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Basic security benefits for job-seekers(Unemployment Benefit II/Social Benefit)Grundsicherung für ArbeitsuchendeBasic security benefits for job-seekers (Grundsicherung für Arbeitsuchende) under BookII of the Social Code (SGB II) is a tax-funded system designed to provide people whoare capable of earning with full and rapid help and support to help themselves.The benefits are mainly geared towards integration into employment. Anyone who is unable to find workdespite making a full effort to seek a job or who does not earn enough from their employment to live from,and is in need of assistance, has a legal entitlement to unemployment benefit II, which is also grantableas an income supplement or top-up.Basic security benefits for job-seekers are assessed on a household basis. This means that social benefit(Sozialgeld) is payable to any individuals in need of assistance who are not capable of earning but live ina joint household with someone who is capable of earning and is entitled to assistance.
Assistance to empower and encourageThe objective of basic security benefits for job-seekers is to empower those who are in need and entitledto assistance, together with others in their joint household, and to help them live by their own means andworking capacity. The benefits aim to support individuals in need and entitled to assistance in taking upemployment and covering their living expenses to the extent they are unable to do so themselves byother means. The aim of the support in taking up employment is to ensure that those in need are placedin suitable work as quickly as possible. Under basic security benefits for job-seekers, individuals in needand entitled to assistance are given access to necessary advice, placement and integration services.Recipients of Unemployment Benefit II may make use of the full range of services provided under SGB IIIalongside the specific integration assistance under SGB II. There is also the option of taking part in apublicly funded employment scheme. Support from personal advisers ensures that individual services toempower those in need are used to full effect. An integration agreement is entered into with job-seekerscontaining a binding commitment to working together towards their integration into employment whilegiving due regard to the individual circumstances of those in need and entitled to assistance together withtheir dependants.Unemployment benefit II is paid out of tax revenue, that is from public funds. It is therefore in the publicinterest for job-seekers not merely to be provided with the best-possible integration assistance, but alsothat they be expected to take the initiative and actively work at finding employment. Support andempowerment thus go hand in hand.Recipients of unemployment benefit II are expected to do all in their power to end their reliance on stateaid and the associated financial burden on society as soon as possible.
Providers of basic benefits for job-seekersThe basic benefits for job-seekers are provided by local job centres. These are the point of contact forthose entitled to assistance; they pay out the benefits and provide the assistance needed.In a job centre, a local employment agency and the local municipality generally work together as theagencies ultimately responsible for the benefits. Local employment agencies are responsible for paymentof the standard rate of assistance towards living expenses and integration assistance. Municipalities areresponsible for providing appropriate levels of assistance for housing and heating and for one-off grants,for example to set up home. They also have responsibility for providing additional education andparticipation assistance (the educational package) and supplementary forms of integration assistance(debt and addiction counselling; childcare). Job centres pay assistance towards living expenses in theform of unemployment benefit II (standard rate plus suitable housing assistance), normally in a singlemonthly amount. A total of 67 administrative and urban districts cover all of the responsibilities involvedas approved municipal providers.
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Entitlement to unemployment benefit IIIndividuals entitled to assistance who are between ages 15 and the age ceiling, which will gradually beraised in line with changes to the official retirement age, and under 65 receive unemployment benefit II(Arbeitslosengeld II). Capability of earning is defined as the ability to work at least three hours a dayunder normal conditions prevailing on the general labour market. Need of assistance is defined as theinability to meet their own necessary living expenses or those of members of their shared household,either out of their own resources (income and assets) or with their earning capacity (by working), or withhelp from others.Individuals entitled to assistance who are not capable of earning but live in a joint household withsomeone entitled to unemployment benefit II receive social benefit (Sozialgeld).The two benefits (unemployment benefit II and social benefit) are equivalent in their basic components,are paid monthly in advance and are generally granted for six months at a time.
Young people’s entitlement to basic security benefits for job-seekersYoung people aged under 25 receive special support to give them the best chances of entering the labourmarket. Anyone under 25 who applies for unemployment benefit II has a right to be placed without delayin an apprenticeship, a job, a training course, or vocational training.Provided that they are in need of assistance, young people over 15 who are capable of earning receiveunemployment benefit II by way of assistance towards living expenses. In determining whether a youngperson is capable of earning (see above), what matters is that they are theoretically able to take upgainful employment – it does not matter if there are circumstances preventing them from doing so, suchas having to attend school.Integration assistanceA range of services are available to provide (re)integration assistance in the search for employment ortraining:Placement guidance and assistance provided via the placement budgetMeasures to activate and secure integration into the jobs marketSupport in taking up further education and training, including repeating the lower secondaryleaving school leaving exam (Hauptschule)Assistance to promote participation in the jobs marketAssistance for employersSupport to help employed persons take up further education and trainingCareers and training guidanceCommunity integration support (such as childcare services, substance abuse and debt advisoryservices)Integration benefitAssistance in taking up self-employmentOpportunities to workSupport to foster employment relations
Reasonable employmentIn principle, any employment is considered reasonable. This is stipulated in Section 10 of SGB II.Exceptions are allowed, for example on physical, mental or psychological grounds or where pay rates areso low as to be deemed immoral. Care of children under the age of three or care of dependants may alsobe given as grounds for rejecting an offer of employment. Other compelling reasons can also be takeninto account – in particular, attendance of a school of general education.Anyone who rejects a reasonable offer of employment, apprenticeship, opportunity to work or place on anintegration scheme can expect to have their unemployment benefit II reduced and then, if offers arerepeatedly rejected, stopped altogether.
- 31 -In such cases, the amount of benefit can be reduced to begin with by 30 percent of the standard rate –about€100a month – for three months. Claimants who fail to comply three times in a year lose allentitlement to unemployment benefit II. Stronger sanctions apply for claimants under 25, whose benefit isstopped if they fail to comply twice. If an individual capable of earning and entitled to assistancesubsequently agrees to fulfil his or her obligations, the sanctions can be reduced. For young people, thismeans the benefits for housing and heating may be reinstated or the period without benefit may beshortened to six weeks, taking the circumstances of the specific case into account.If benefits are reduced by more than 30 percent, the job centre may provide supplementary non-cashbenefits or vouchers. The provision of such benefits is mandatory if the entitled individual shares a jointhousehold with minors.
Amount, duration and payment of unemployment benefit IIUnemployment benefit II is assessed entirely as a needs-based welfare benefit. This means benefits fromother providers must be claimed first and any entitlement to unemployment benefit II is reduced byincome and assets that must be taken into account (excluding exempt income and exempt assets).Ultimately, the amount of unemployment benefit II depends on the specific needs of the individualcapable of earning and entitled to assistance and the needs of any others (spouse/partner and anychildren under 25) living with them in a joint household.Individuals capable of earning and entitled to assistance receive unemployment benefit II in the form ofthe standard rate plus possible assistance towards living expenses, including a reasonable amount foraccommodation and heating.The standard rate for individuals capable of earning and entitled to assistancecovers food, bodycare, household effects and everyday personal necessities,plus expenditure on maintaining contacts with the outside world and on takingpart in cultural life. It is intended to cover both recurring and non-recurringitems of expenditure. Costs of electricity, bus and car travel must also be metout of the standard rate of benefit.The German Federal Ministryof Labour and Social Affairsruns a citizens’ informationline on labour market policyand promotion. Tel. 018056767-12, Mondays toThursdays, 8 am to 8 pm.Calls from the Germantelephone network cost€0.14per minute.
Under legislation on the determination of standard rates of benefit andamending Book II and Book XII of the Social Code (cited as BGBl. 2011 Teil INr. 12 and dated 29 March 2011), the levels of assistance towards living expenses (standard rates) aretransparently and verifiably derived from a 2008 income and consumption survey.From 1 January 2013, the standard rate for singles, single parents and job-seekers whose partner isunder 18 is€382per month. If both partners are of age, the standard rate is€345per month each.
For children and young adults, the standard rate is determined by age group. It is€224for children up tosix years old,€255for ages 6 to 13,€289forages 14 to 17 and€306for ages 18 to 24.From 1 January 2011, in addition to the standard rates for children and young adults, various types ofeducation and participation assistance are also provided (the educational package).The educational package consists of the following types of assistance:Actual expenses incurred for single-day and multiple-day school/daycare centre outingsAssistance for personal school supplies (€70 on 1 August and€30on 1 February each year)Costs of pupils’ transportation to/from school, where necessary and if not already met from othersourcesAssistance for learning support in specific circumstancesAdditional cost of communal meals at school or in a daycare centreMonthly budget totalling€10for participation in social lifeThese forms of assistance are also made available for children for whom supplementary child allowanceor housing benefit is granted.In this way, those entitled to the benefit receive a lump-sum amount to cover all needs.
- 32 -Additional expenditure not covered by the standard rate may be covered in certain situations andcircumstances:1. For expectant mothers from the thirteenth week of pregnancy2. For single parents regardless of the ages and number of children3. For people with disabilities to assist their integration into the jobs market4. For food (subject to documentary proof that an expensive diet is medically necessary)5. For ongoing special needs that are unavoidable in the individual case (hardship clause)6. For individual water heating (gas or electric boiler) where necessaryTotal additional expenditure for living expenses under headings 2 to 4 must not exceed the standard rate.The monthly benefit provides a budget which recipients must manage independently. If the amountreceived fails to cover immediate needs, supplementary loans may be considered in certaincircumstances.In addition to the standard rates, non-recurring assistance may be provided:1. For setting up a household, including the purchase of appliances2. For initial outfitting with clothes, and initial outfitting with maternity and nursing needs3. For the purchase and repair of orthopaedic footwear and for repair or rental of therapeutic equipmentEven if they are not entitled to assistance towards living expenses because they are not considered to bein need, claimants may still be entitled to non-recurring assistance if their income is not sufficient to payfor special needs in full.Housing costs: It is no longer necessary to apply for housing benefit when applying for unemploymentbenefit II. The municipal providers meet reasonable accommodation and heating costs for a claimant’sentire joint household as part of unemployment benefit II/social benefit. These include hot and cold watersupply and sewage charges. A loan may also be provided for rent arrears if homelessness otherwisethreatens. The municipal providers are responsible for deciding what is reasonable and appropriate.Rent for unreasonably large or expensive accommodation is paid for a maximum of six months unless itis possible and reasonable to expect that the claimant either move before then or reduce the rent, forexample by taking in a lodger. A decision whether to reduce payments to the amount deemed reasonableis made on a case by case basis at the end of the six months.In individual instances, the municipal provider can insist that a claimant move, but will then meet the costsof obtaining new accommodation and of the removal, and will pay any deposit. These costs are also metif a move becomes necessary for other reasons and alternative accommodation cannot otherwise befound within a reasonable period of time.
Standard rates of benefitSingle personsand single parentsChildren to age6€382€224Other members of a joint householdChildren fromage 7 to 14€255Children fromage 15 to 18€289Young adultsfrom age 19 toage 25€306Partners age18 or over€245
Social security contributionsUnless already insured through another family member and unless they are privately insured, individualscapable of earning and entitled to assistance are compulsorily insured in the statutory health insuranceand social long-term care insurance schemes. Privately insured individuals entitled to assistance receivea subsidy towards insurance contributions. Recipients of social benefit are generally covered by familyhealth and long-term care insurance.
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Prevention of need with supplementary child allowanceParents capable of covering their own living expenses but not their children’s upkeep can receivesupplementary child allowance (Kinderzuschlag). This is to prevent parents from having to apply forunemployment benefit II/social benefit solely for the children’s upkeep.The maximum allowance is€140per child per month. It is applied for at the family benefits department(Familienkasse), which also pays out child benefit. Up to what level of income families can receive theallowance depends on the amount of rent they pay and any entitlement for additional expenditure.If the parents’ income exceeds their own needs, 50 percent of the excess is not deductible. Theremaining 70 percent of the excess is deducted from the supplementary child allowance. The allowanceis paid for a maximum of six months per child. Subsequent payments are possible if the applicable criteriaare fulfilled. The Federal Ministry for Family Affairs, Senior Citizens, Women and Youth (BMFSFJ)website has a calculator function which recipients can use to calculate the amount of supplementary childallowance they can expect to receive (http://www.bmfsfj.de/Kinderzuschlagrechner).Further information is provided in a German-language leaflet, Grundsicherung für Arbeitsuchende –Fragen und Antworten – SGB II (Basic Security Benefits for Job-Seekers: Questions and Answers),published by the Federal Ministry of Labour and Social Affairs.
- 34 -
Labour lawArbeitsrechtEmployees depend on their employers, not only economically but also in a personalsense, as is borne out by their contracts of employment. So they need protecting, andthis is the task fulfilled by labour law. This branch of the law applies both to blue-collarand white-collar employees (who are distinguished from one another in Germany asArbeiter and Angestellte). People working from home, whose livings are especiallydependent on the organisations providing them with work, are also covered by labourlaw, partly under laws and regulations applying specifically to their situation, and partlyunder those applying equally to people who travel to their place of work.Labour law is divided into two sub-categories. Individual labour law governs relations between singleemployers and their single employees. Collective labour law applies to legal relations between unions andemployer associations at company level and at supra-company level.Collective labour law aims to create uniform working conditions and encompasses the law relating tofreedom of association, collective bargaining, conciliation and arbitration, industrial disputes, employeerepresentation and co-determination.
What individual labour law coversIndividual labour law centres around the relationship between a person in work and his or her employer,as governed by the employment contract between them.There are two main questions dealt with by every employment contract: the first is “What work am Iexpected to do?” and the second is “What pay am I entitled to in return?”Your employment contract may also lay down other rights and duties that go to make up your overallworking conditions. Both you, as an employee, and your employer may be affected by these rights andduties. A number of different laws ensure that you are entitled to certain minimum employees’ rights.These include the Federal Holidays Act and the Continuation of Pay Act which entitles you to sick payfrom your employer for up to six weeks if you are absent due to illness, the Act on Part-Time Work andFixed-Term Employment Contracts (Teilzeit- und Befristungsgesetzes, or TzBfG), and the Home andInstitutional Care Act (Pflegezeitgesetz, or PflegeZG). Under certain circumstances, the TzBfG allowsemployees to reduce their working hours; its provisions designed to prevent part-time workers from beingtreated differently to full-time employees unless there are justified grounds for doing so. The PflegeZGmakes it easier to reconcile demands of work and family care by allowing employees in certaincircumstances to look after close relatives in need of nursing care at home for up to six months. TheGeneral Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz, or AGG) also provides minimumprotection against discrimination at work by prohibiting discrimination on account of race or ethnic origin,gender, religion or world view, disability, age or sexual identity.The minimum statutory rights can be enhanced by an individual contract of employment or by a collectiveagreement (see ‘Collective Bargaining Law’ in the next section) laying down an entitlement to more paidholiday than the minimum requirement.Periods of notice are also stipulated by law. Employees and employers alike always have to observe thebasic period of notice of four weeks, either to the 15th or to the end of a calendar month. The longer youhave worked for the same establishment, the more notice it will have to give you to terminate yourcontract. Once you have worked there for two years when over 25 years of age, the minimum period ofnotice is one month to the end of a calendar month. The statutory period increases by one month eachtime you complete your 5th, 8th, 10th, 12th and 15th year working for the same employer. The finalincrease, from six to seven months’ notice to the end of a calendar month, comes when you havecompleted 20 years of service.Any individual employment contract may include longer—but not shorter—periods of notice if the partiesagree, and a collective agreement may include either longer or shorter periods.
- 35 -According to the Unfair Dismissal Protection Act (Kündigungschutzgesetz), an ordinary dismissal (withcorrect period of notice) is socially justified and legal if it is issued for reasons to do with the individual orhis or her behaviour or is necessary for operational reasons that do not allow the individual’s continuedemployment. Whether the Unfair Dismissal Protection Act applies to an employment relationship dependson the size of the company (or the administration) and the commencement date of the employmentcontract.From 1 January 2004, the Unfair Dismissal Protection Act applies to workplaces with a workforceof ten or more.Employees with contracts commencing on or before 31 December 2003 at workplaces with aworkforce of five or more continue to enjoy protection from dismissal. Based on the Act’s priorapplication thresholds, the latter retain their protection from dismissal as long as theestablishment has more than five employees who were already on the workforce on 31December 2003. Employees hired after 31 December 2003 are not counted.
Annual holiday entitlements18801903193019461963*1974*1995* In former West Germany
-3 days3–15 days12 workdays15–18 workdays18 workdays24 workdays
Metalworking industries and breweries onlyDepending on the industry and length of serviceStatutory minimum holiday entitlementStatutory minimum holiday entitlementStatutory minimum holiday entitlementStatutory minimum holiday entitlement
When determining the number of employees, part-time employees are counted in proportion to theirworking hours, and trainees are ignored.Application of the Unfair Dismissal Protection Act requires that the employee had been employed formore than six months continuously prior to receiving notice (waiting period).An employment contract can be summarily terminated (that is, terminated without notice) incircumstances such that it would be unreasonable for either side to continue the contractual relationship.If employees wish to contest the validity of the social or other grounds given for termination with notice orthe reasons for summary dismissal, they must bring a legal action with the labour court (Arbeitsgericht) ofcompetent jurisdiction within three weeks of the notice being served.The preconditions for limiting the term of an employment contract and the legal consequences of aninvalid term limitation are governed by the Act on Part-Time Work and Fixed-Term Employment Contracts(Teilzeit- und Befristungsgesetz). Limited-term employment contracts terminate without notice when thecontract period expires or on achievement of a specified purpose. A limited-term employment contractmay be terminated with the agreed period of notice but before it the contract period expires if thepossibility of termination is agreed in the employment contract or the applicable collective bargainingagreement. There is a three week limitation of action if an employee wishes to contest the validity of aterm limitation in his or her employment contract.Any notice of termination or employment termination agreement and any agreement limiting the durationof a contract of employment must be in written form in order to have legal effect.If employees wish to contest the validity of the social or other grounds given for termination with notice orthe reasons for summary dismissal, they must bring a legal action with the labour court (Arbeitsgericht) ofcompetent jurisdiction within three weeks of the notice being served. There is also a three week limitationof action if an employee wishes to contest the validity of a term limitation in his or her employmentcontract.
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What collective labour law coversCollective labour law can be subdivided into two levels:Collective bargaining law—the level dealing with relations between trade unions, employers’federations and individual employers.The law on labour relations at the workplace—the level dealing with relations between employerand workforce in individual establishments.Your obligationsCertainly, labour law is chiefly intended to protect your rights as an employee but—as with most rights—you do also have a number of obligations.Your most important obligation in this area is to do a certain job of work. In return, your employer has theduty to pay you a certain wage or salary.A number of other employer’s and employee’s duties may also be laid down in your contract ofemployment.If you want to leave your job, you too must give sufficient notice (see next paragraph).The basic statutory period of notice is four weeks to either the fifteenth or last day of a calendar month.The collective agreement affecting your employment conditions may specify a different period of notice(longer or shorter). If it does not simply state that it will abide by the collective agreement, your contract ofemployment can generally only stipulate longer periods of notice. Shorter periods of notice can be agreedfor the first three months in individual employment contracts for temporary workers. In smallestablishments with no more than 20 employees, the four-week notice period can be agreed in individualemployment contracts without stipulating a date to which notice must be served (thus allowing noticeother than to the fifteenth or last day of a month). Employees cannot be required to give a longer period ofnotice than the employer has to give them.
Collective bargaining lawThe right of trade unions and employers’ federations to negotiate pay and conditions without stateinterference (their ‘collective bargaining autonomy’) is protected by the German constitution. The twosides of industry thus take their own responsibility for the pay and other agreements they reach.The pay and conditions for most jobs in Germany are covered by such collective agreements. This initself shows how important collective bargaining autonomy is in this country.Collective agreements are drawn up either between trade unions and employers’ federations, or betweentrade unions and individual employers. They are the most important instrument available to the two sidesfor promoting their members’ interests and bringing their influence to bear on working and other economicconditions. Collective agreements fulfil three main functions:1) ProtectiveA collective agreement gives employees protection against employers ‘taking the law into their ownhands’ in order to impose working conditions. This is important, as your contract of employment is notpermitted to breach the minimum working conditions set by the collective agreement for your industry andregion.2) OrganizationalA collective agreement fleshes out the content of all employment relationships it covers while in force.3) Preserving industrial peaceWhile a collective agreement remains in force, employees are prohibited from going on strike to enforcenew demands relating to the pay and conditions the agreement covers.Typical conditions laid down in collective agreements include:Wage or salary levelsWorking hoursHoliday entitlementPeriods of notice
- 37 -You are not automatically entitled to such collectively agreed conditions, wage levels, and so on. Thecollective agreement only applies to you:Either if your employer belongs to the employers’ federation, and you are in the trade union, thatconcluded the agreement (alternatively, your employer may be a direct party to the agreement)Or if the collective agreement has been declared generally applicable. Naturally, your ownemployment relationship will also have to be of the type covered by the agreement.Beyond this, it is quite possible for your employer to agree with you under the terms of your employmentcontract that collectively agreed conditions should also apply to your working relationship. Your contractwill then have equal status if it is normal company practice to apply collective agreements.Agreed working week, classified by working hoursWorking hours200820073519.720.1362.72.736.50.50.4376.06.837.513.012.33810.910.638.521.922.43914.313.239.50.20.2408.68.9410.20.241.5––42––42.5––43––44––45––Average working hours37.5937.57
Percentage of workers20051998199520.519.818.82.82.30.90.40.60.36.86.89.012.512.712.611.010.06.923.721.120.613.417.018.30.70.20.29.09.212.30.20.20.1––––––––––––––––––37.6437.6537.80
1980–––––––––94.01.4–3.50.40.7––40.12
1975–––––––––90.61.60.71.50.41.62.70.940.27
The law on labour relations at the workplaceThe law on labour relations at the workplace regulates the relations between a company or otherorganisation and its employees. The term ‘workplace’ is used because, in larger organisations, the rulesare likely to apply to specific establishments as well as to the organisation as a whole. The basicphilosophy is to ensure there is trusting co-operation among the trade unions and employers’ federationsrepresented at each workplace, to the benefit of employees.The works council (Betriebsrat) is elected by the workforce. Its immediate purpose is to perform a numberof general tasks. For example, it monitors operations to make sure that all legal requirements, safetyregulations, collective agreements and in-house agreements designed to benefit employees are adheredto and implemented as necessary.In addition, the works council has to be involved in social welfare, personnel andeconomic issues. These participation rights are classed according to theirscope:As rights of co-determinationOr as rights of information and consultation.The German Federal Ministryof Labour and Social Affairsruns a citizens’ informationline on labour law. Tel. 030221911004, Mondays toThursdays, 8 am to 8 pm.
Co-determination is the stronger form of participation. In cases in which theworks council has such rights, the employer needs to obtain its approval before being allowed to takecertain actions. What happens, you may wonder, if the works council refuses its consent? Any suchcases are referred to a board of arbitration, made up of employer and works council representatives onan equal basis, with a neutral chairperson.In the second category of participation rights, the employer is required to inform the works council, to hearits views or to consult with it.
- 38 -You will find more details on the law governing workplace labour relations in the chapter on IndustrialDemocracy.
The lawThe laws and acts of parliament governing labour law include the following:The Civil CodeProtection against Unfair Dismissal ActFederal Holidays ActProtection of Working Mothers ActContinuation of Pay ActDocumentation of Employment Conditions ActWorking Hours ActProtection of Minors at Work ActTrade Regulation ActCollective Bargaining ActPart-time and Limited-term Employment Contracts ActWorks Constitution ActSenior Management Representative Committees ActCoal, Iron and Steel Industry Co-determination ActOne-Third Participation ActCo-determination ActHome and Institutional Care ActPosting of Workers ActMinimum Working Conditions ActGeneral Equal Treatment Act
Important: In all public services, the Federal and Länder Personnel Representation Acts operate in placeof the Works Constitution Act, which governs industrial relations in the private sector.
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Industrial democracyBetriebsverfassungHow far do the rights of consultation of individual employees and their workplacerepresentatives go, and how much of a share can they have in decision-making? Whatare the trade unions’ rights at the workplace? These questions are answered by theWorks Constitution Act, which lays down how the workplace labour relations system inGermany should operate.The Act allows employees to participate in decisions made at their place of work. Theseparticipation rights cover practically all areas of activity at work, including social welfare,personnel and economic matters. So the Act establishes democratic conditions at theworkplace, opening up greater opportunities to make working life more civilised.A 2001 law reforming the Works Constitution Act and bringing workplace industrialrelations into line with today’s working and business environment ensured thecontinuing effectiveness of the workplace industrial relations model to the benefit ofemployers and employees alike. The reforms create adaptable, modern employeerepresentative structures, make it easier to constitute works councils, extendrepresentation to special forms of employment such as temporary work, improve theworking conditions for the works council itself and for youth and trainee representatives,strengthen works council co-determination rights in job security and training issues,simplify the election procedure in establishments with up to 50 employees (or up to 100in agreement with the employer) who are entitled to vote, promote equal opportunitiesfor women in the workplace, and abolish the outdated distinction between blue-collarand white-collar workers.The works council represents all employeesThe size of the works council depends on the size of the workforce at a particular establishment:- If 5-20 employees are eligible to vote, the function is carried out by one person- If 21-50 are eligible to vote, the works council will have three members- If 51-150 are eligible to vote, the works council will have five membersLarger workplaces have correspondingly larger works councils. If there are a number of works councilswithin the same company, a central works council must also be established. A group works council canbe constituted if there are two or more central works councils in a group of companies. The same appliesto youth and trainees’ delegations.If a company has more than 100 employees, a finance committee (Wirtschaftsausschuss) must also beformed. This committee has extensive rights of information and consultation on financial matters. Themembership is nominated by the works council.Important: If a works council has three or more members, whichever gender is in the minority among theworkforce must make up at least the same percentage of the works council as it does in theestablishment as a whole. If the works council has nine or more members, it must also appoint anoperational committee (Betriebsausschuss) to manage its everyday business. In certain circumstances,delegates of the trade unions operating at the workplace may also take part in works council meetings.
Your rightsAs an employee, you have many rights which are enshrined in law. For example, you are entitled toinformation and to be heard by your employer in matters relating directly to your own job. You can:Demand to be informed of what impact technical innovations will have on your job
- 40 -View your employee fileHave the assessment of your performance explainedHave the way your pay is calculated explained
If you believe you have been treated unjustly or discriminated against, you can make a complaint. If youwish, you can call on the support of the works council, which will then represent your interests in dealingswith your employer.The works council and your employer should co-operate on a basis of trust, in the interests of theemployees at your workplace. In so doing, they should also cooperate with the trade unions and relevantemployers’ federations.
What establishments have a works council?If a private sector establishment has at least five employees over the age of 18, they are entitled to electtheir own works council (Betriebsrat). However, at least three employees need to have been there for atleast six months (this is the requirement to be eligible for office).Employees under 18 years of age and trainees under 25 years of age can, if they wish, elect their ownyouth and trainees’ delegation.A central works council must be established if a company has several operating locations that each havetheir own works council; a group works council if the company is part of a larger group.Government offices (at the federal, Länder and municipal levels), and other public sector agencies andinstitutions do not have works councils. They are covered instead either by the Federal PersonnelRepresentation Act or by similar acts in force in each of the Länder.Senior managerial staff are not represented by the works council. If an establishment has at least tensenior managers, they are entitled by the Executive Committees Act to form an executive committee. Acorporate executive committee can be formed for the company as a whole, and a group executivecommittee if it belongs to a group of companies.Note: Senior management can only elect a representative committee if a majority emerges in favour of itsformation the first time a ballot is held.
The right to vote for the works councilAll employees aged 18 and over have the right to vote for the works council. However, employees are noteligible to stand for membership until they have spent at least six months working for the sameestablishment, or elsewhere in the same company or group.Since the Act Reforming the Works Council Act (Gesetz zur Reform des Betriebsverfassungsgesetzes)came into force, temporary employers have the right to vote in works council elections in the hiringcompany provided they have worked there for more than three months.Under an amendment to Section 5 of the Works Constitution Act, civil servants, public-sector employeesand members of the armed forces are now normally considered employees as defined in the Act whenemployed in an establishment belonging to a private-sector enterprise. The rule governing classificationas a senior managerial employee under Section 5 (3) of the Act likewise applies to civil servants andmembers of the armed forces employed in a private-sector enterprise. This introduces general provisionfor civil servants and public-sector employees to stand for election and be elected onto works councils,supervisory boards and executive committees in private-sector enterprises.The works council election is a key element of industrial democracy, which is why employers are requiredby law to provide for works council elections and ensure they are properly conducted. Thus, any attemptsto obstruct or unlawfully influence the election are subject to prosecution. A breach of election provisionscan lead to the election being appealed before the labour courts. If the election is declared null and void,a new election must take place.
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Tasks of the works councilThe main tasks of the works council include monitoring the employer’s adherence to all legalrequirements, safety regulations, collective agreements and in-house agreements on the employees’behalf.There are various social welfare matters in which the works council influences decision-making (known asits ‘right of co-determination’). This applies to situations:When questions arise relating to internal rules specific to the establishment, or to the conduct ofemployeesWhen issues of working hours at the establishment have to be dealt with, or when there are plansto introduce short-time or overtime workingWhen the principles for allotting holiday time are announced, the holiday schedule is posted or (incases where employee and employer cannot agree) individual employees have their holidayallottedWhen determining the form to be taken by social welfare facilities operating solely at the oneestablishment, or within the one company or group, and how those facilities should be runWhen there is any proposal to introduce mechanisms to monitor the conduct and performance ofemployeesAs provided by legislation, when measures are taken to combat occupational hazards (accidentor illness), or when issues of health protection are involvedWhen company residential accommodation is to be allocated or vacatedWhen issues come up regarding the composition of pay at the workplace, when paymentsystems are devised, or piecework and bonus rates or similar performance-related payments aresetWhen determining principles for the practice of group workingThe works council also cooperates, and has a substantial amount of say, on these matters:Developing job descriptions, work processes and working environmentsPersonnel planningVocational training
In view of the current importance of job security and training, works councils have been given greaterparticipatory rights. For example, a works council can make proposals to the employer regarding flexibleworking hours, the promotion of part-time work and partial retirement, on in-house employee training, andon new forms of work organisation and changes to processes and work flows.Once the scope of the planned changes are known, the works council representative can implement asocial plan to compensate for or alleviate the financial disadvantages employees would face as a result ofthe change. The final decision lies with the labour courts.The Works Council must be consulted prior to terminating an employment contract. If the employer fails todo so, the termination is declared null and void.If the employer plans structural changes in the workplace (such as cutbacks, closing down or relocatingoperations), they must inform the works council representative without delay, discuss the plannedchanges with them prior to making a final decision and attempt to reach an agreement that considers allneeds.Once the scope of the planned changes are known, the works council representative can implement asocial plan to compensate for or alleviate the financial disadvantages employees would face as a result ofthe change.In certain circumstances defined by law, the works council is entitled to refuse its consent. If the employerstill wishes to implement a measure the works council has legally rejected. The final decision lies with thelabour courts.If a company has more than 20 employees entitled to vote, the employer must obtain the works council’sapproval for all specific personnel changes, namely:
- 42 -New appointmentsGradingsRegradingsTransfers
In certain circumstances defined by law, the works council is entitled to refuse its consent. If the employerstill wishes to implement a measure the works council has legally rejected, the matter has to be referredto a labour court.Important: An employer must also hear the works council’s opinion before dismissing an employee. If theemployer fails to do this, the dismissal will be invalid.Furthermore, the works council has the right to contest routine dismissals. If, for example, your employerhas given you due notice of dismissal, the works council has contested this on one of a number of legallyadmissible grounds, and you have filed an action for unfair dismissal, your employer will initially be forcedby the law to keep you on in your job if you so demand. Only the labour court can relieve your employerof this duty to keep you on.If the works council has given good grounds for contesting an employee’s dismissal, this will substantiallystrengthen his or her position in unfair dismissal proceedings before the court.Everyone employed at any establishment has to be treated justly and equitably. The employer and theworks council share the responsibility for ensuring that this principle is observed. They particularly need toensure that nobody is treated differently from his or her colleagues because of his or her race or ethnicorigin, heritage or other background, nationality, religion or beliefs, disability, age, gender, sexual identity,political views or activities, or trade union activities. The works council and the youth and traineerepresentatives thus have the right to apply for measures to combat xenophobic tendencies in theworkplace. Similarly, no employee may be placed at a disadvantage because he or she has passed acertain age limit. Finally, the employer and the works council are responsible for ensuring that employeeshave scope for personal development.The works council must hold a workplace general meeting once every calendar quarter. The meetingallows the works council and employees to exchange their views and concerns. The works council is alsorequired to report on its activities to the general meeting. Employees have the opportunity to comment onthe works council’s decisions, and to propose motions for resolutions.
Works AgreementThe works agreement is the most important instrument of the works constitution. It is agreed in writingbetween the employer and the works council and serves primarily in implementing co-determinationrights. The provisions contained in the works agreement apply directly and bindingly for all employeesand for the employer.Pay, salary and other work conditions governed or which are usually governed by collective bargainingagreements may not be governed by a works agreement.Arbitration committeeThe arbitration committee is a works constitution body which handles and mediates in-house disputes. Itcomprises an equal number of employer and works council representatives, plus a neutral chairperson onwhom both sides agree. The arbitration committee only acts if the two sides request it and are thusagreed that such action is needed. In cases where this is required by law (e.g. in co-determinationmatters), the committee’s decision can be replaced by an agreement between the employer and theworks council. The arbitration committee can then act upon the request of one or other party.
Industrial democracy in EuropeThe 1996 Act on European Works Councils transposed the EU Directive on European Works Councilsinto German law. It provides for cross-border information and consultation of employees in community-scale enterprises and groups of companies that have operations in two or more EU member states or the
- 43 -European Economic Area. The Act’s scope of application takes in such enterprises and groups thatoperate in Germany, have at least 1,000 employees in the member states and of those at least 150employees each in two different member states.The European Works Council (EWC) is a transnational employee representation body which isresponsible for informing and consulting employees in transnational enterprises and groups ofcompanies. It supplements national-level employee representations (works council, central works council,group works council) without affecting their area of jurisdiction.The establishment of the EWC and the structuring of cross-border information and consultation ofemployees is primarily the responsibility of central management and the special negotiating body,comprising employee representatives from the respective EU member states, in accordance with avoluntary agreement. The EU Directive gives both employer and employee representatives the broadestpossible scope as regards company-specific structure and organisation of the EWC. The EU Directiveand Germany’s Act on European Works Councils do however provide a set of rules for guidance. Thisrequires that the agreements set out the responsibilities and work performed by the EWC, the procedureto be used in informing and consulting employees, the place, frequency and duration of meetings, and thefinancial and material resources allocated to it.Only when it is clear that no agreement can be reached on the establishment of an EWC does the EUDirective and the German Act on European Works Councils prescribe that an EWC be established by lawand sets out the specific responsibilities and the procedure to be used in informing and consultingemployees.The minimum requirement for mandatory establishment of an EWC calls for the EWC to be informed andconsulted once per calendar year about the business developments and prospects of the enterprise orgroup. This includes details of the economic and financial situation, the expected trends in business,production and sales, workforce levels, investments, relocation of production sites, mergers, downsizingor closure of companies, operations or significant portions of operations, and mass redundancies. This islargely in line with the provisions laid down in Section 106 (3) of Germany’s Works Constitution Act.Apart from these regular meetings, the EWC must be informed and, upon request, consulted on extra-ordinary cross-border activities where these have an impact on the workforce and significantly affectemployee interests (e.g. relocation of production sites, works closures, mass redundancies). This meansthat if extra-ordinary circumstances arise, central management must inform the EWC, provide it with thenecessary documentation without delay and consult it if requested to do so by the EWC itself. The EWCmust normally be consulted in a timely manner to ensure its proposals and concerns are taken intoaccount before a business decision is reached.The Directive on European Works Councils was recast in 2009 in close consultation with unions andemployers’ associations. Changes include definitions of the terms ‘information’ and ‘consultation’ ensuringthat an EWC is given timely notification prior to any corporate decisions involving any transnationalrestructuring. In the main body of the Directive, EWCs are assigned competence for transnational issues.Additionally, among other things, it is clarified that EWCs must be provided with the means to representthe workforce collectively under the Directive, that the agreement establishing an EWC must berenegotiated on any major restructuring of the company or group of companies concerned, and thatmembers of the EWC must be provided with necessary training. The new provisions were transposed intonational law with the revised Act on European Works Councils and came into effect on 18 June 2011.
The lawThe legislative basis for the fields discussed in this chapter is provided by:The Works Constitution ActThe Federal Personnel Representation Act plus Personnel Representation Acts in force in eachof the LänderThe Executive Committees ActThe Act on European Works CouncilsNumerous legal provisions are also in place to facilitate the support of works councils by the trade unions.
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Co-determinationMitbestimmungWhether they deal with marketing plans, new products, capital investment orrationalisation measures, virtually all operational and entrepreneurial decisions taken byan organisation also affect its employees. This is why employees have been granted theright to share in such decisions-making (known as ‘co-determination’). The co-determination system means that employees, via their elected representatives,participate in policy-making at their place of work and within their company.Employee co-determination is one of the fundamental elements in the way Germansociety operates. The idea stems from a basic conviction that democratic principlesshould not be con-fined to the state as such, but need to be rooted in all areas ofsociety.The other side of the coin in co-determination is that employees and their trade unionsare also prepared to take a share in corporate responsibility. That has meant that theyhave helped shape and stabilise society in the Federal Republic of Germany over thepast few decades, and continue to do so today.
Your rightsDo you work for a medium-sized or large company, incorporated in the form of a public limited company(Aktiengesellschaft—AG), private limited company (GmbH), partnership limited by shares (KGaA),cooperative, or mutual insurance company? If you do, the company is required by law to operate a two-tier board system, and you can exert your own influence on company policy via your representatives onthe supervisory board.This form of co-determination is not confined to employee welfare issues—it covers the complete range ofbusiness activity.The supervisory board (the higher-tier, non-executive board) has the power to do any of these things:Appoint or dispense with the services of top executive managers (who sit on the lower-tier,executive board). This does not apply in a partnership limited by shares (KGaA).Gather comprehensive information on all of the company’s business affairsImpose a requirement that important corporate decisions, on matters such as large capitalprojects or rationalisation measures, must have the supervisory board’s approval.Composition of the supervisory boardThe supervisory board’s membership consists of equal numbers of shareholder and employeerepresentatives. The board must include:- Six representatives from each side in a company with up to 10,000 employees- Eight representatives from each side in a company with over 10,000 and up to 20,000employees- Ten representatives from each side in a company with more than 20,000 employees.A company may opt for a larger supervisory board than is called for in the Act, writing this into its articlesof association. Companies required to have a 12-person supervisory board may thus elect to have a 16 or20-person board, and those required to have 16 members may raise the number to 20.The trade unions acting within a company or group are entitled to have their representatives occupy someof the employee seats on the supervisory board. They may claim:- 2 seats on a 12 or 16-person supervisory board- 3 seats on a 20-person supervisory board
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Co-determination in large companies under the Co-determination ActIncorporated firms not in the coal, iron and steel industries (which have their own co-determination rules)and employing more than 2,000 people, either directly or in subsidiary companies under their control, aresubject to the Co-determination Act of 1976. The Act provides that a company’s supervisory board mustbe made up of employee and shareholder representatives in equal measure. Despite this, the company’sowners do have slightly more say, since the chairperson—who in practice is invariably a shareholderrepresentative—has an additional casting vote to ensure that a majority is obtained whenever the boardhas come to a tied voting decision at the second attempt. Moreover, one of the employee seats on theboard is always occupied by a management representative. In companies outside the coal, iron and steelindustries, the employee representatives on the supervisory board do not have a right of veto when thelabour relations director (who sits on the executive board) is appointed.
How employee board representatives are chosenAll employee representatives on the supervisory board are elected either in a direct ballot or via delegates(the process depends on the size of the workforce) to an electoral college, regardless of whether theycome from inside the company or are external, trade union representatives.
Election of shareholder representativesThe shareholder or ‘capital’ representatives on the supervisory board are elected at the shareholders’annual general meeting.
Election of the chairpersonAt the first meeting of a newly elected supervisory board (its ‘constitutive meeting’), the board’schairperson and vice chairperson are elected by its members. A candidate must receive a two-thirdsmajority to be elected.Important: If a candidate does not attain the necessary majority, a second ballot is held. This time round,the shareholder representatives elect the chairperson, and the employee representatives the vice-chairperson – the majority of votes cast being decisive in each case.
The executive boardThe supervisory board is responsible for appointing the members of the executive board—and is alsoempowered to dismiss them.Important: Candidates for election to the executive board must also attain a two-thirds majority to besuccessfully elected. If a candidate fails to attain this, a mediation committee is set up.If an absolute majority still cannot be achieved, the supervisory board’s chairperson has an additionalcasting vote in a further ballot.The executive board also includes a labour relations director who has equal status with the other boardmembers. The labour relations director’s area of responsibility primarily covers personnel and employeewelfare matters.
Co-determination in smaller companies under the One-ThirdParticipation ActEmployee representatives have to make up one third of the membership of the supervisory board inincorporated firms with 501 to 2,000 employees.However, there is no lower limit on the number of employees in a company if it is a public limitedcompany (AG) or partnership limited by shares (KGaA) established before 10 August 1994, and is not afamily firm. That is, companies fitting this description are also obliged to have one third of theirsupervisory board made up of employee representatives, even if they have less than 500 employees. Onthe one hand, this one-third participation does not give the employees much of a share in decision-making power, but it does allow them to be party to important company information.
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Co-determination in the coal, iron and steel industriesCo-determination in the coal, iron and steel industries not only has the longest tradition but is also moreextensive than anywhere else. In these industries, the rules apply to any incorporated firm with more than1,000 employees.In these industries, too, the supervisory board is composed of equal numbers of members representingshareholders and employees. However, it also includes one additional, ‘neutral’ member. Supervisoryboards in the coal, iron and steel industries normally have 11 members, but the number may increase to15 or 21 in larger companies.The members of the executive board are appointed and dismissed by the supervisory board. Theexecutive board must also include a labour relations director. A person cannot be appointed to ordismissed from this post if a majority of the employee representatives is opposed to it. This ensures thatlabour relations directors always have the confidence of the employee representatives on the supervisoryboard.Note: Any incorporated firm that does not in itself belong to the coal, iron and steel industries but is theparent company of others that do is subject to a diluted form of these co-determination rules.
The lawIn the coal, iron and steel industries, the key pieces of legislation are the Coal, Iron and Steel Industry Co-determination Act of 1951 and the Supplementary Co-determination Act of 1956.
Co-determination in a European company under the Act on EmployeeParticipation in European Companies (SEBG)With the German Act on the Introduction of European Companies (SEEG) which entered into force on 29December 2004, the EU Regulation on the Statute for a European Company (SE) and the supplementingDirective on involvement of employees were transposed into German national law. The SE is a new legalform under EU law and lines up alongside the legal forms of Aktiengesellschaft and GmbH allowed underGerman law. The introduction of the SE aims to simplify the establishment of cross-border mergers withinthe European Community. The establishment of an SE can take four main forms: transformation, mergerand establishment of either a holding company or a subsidiary.
Organisational structuresThe SE may be organised under either a two-tier system with a management board, a supervisory boardand a general meeting or – following the example of many of our neighbouring EU Member States – asingle-tier system. In contrast to the two-tier system in which the supervisory board monitors themanagement board, the single-tier system combines the two functions into a single administrative board.The single-tier system is new to German company law.
Employee participation in an SEEmployees’ rights to participate in a European company are set out in the German Act on EmployeeParticipation in European Companies (SEBG). Like the SE Directive, the SEBG is based on the followingfundamental structures:Employee rights in force before the establishment of SEs should provide the basis for employeerights of involvement in the SE (the ‘before and after’ principle).Employee involvement is categorised into information and consultation rights and alsoparticipation in SEs. This is largely in line with the differentiation applied under German co-determination laws.The procedures for employee involvement in an SE should be agreed between the employer andthe employees. The employees are represented by a special negotiation body (BVG).In the absence of an agreement, a set of standard rules are applied. This ensures to a largeextent that employees retain their existing participation rights in the founding company.
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Negotiation proceduresThe SE treads new ground with regard to co-determination because in an SE, employee involvement isdetermined through negotiation. The result of the negotiations affords those involved broad negotiationfreedom.On the employer side, the negotiations are conducted by management or administrative bodies of thefounding businesses. On the employee side, the special negotiation body representing the employeesmust be formed to represent employees from all founding businesses. The provisions of the SE Directiverequire that employees in each EU Member State be given one seat on the special negotiation body foreach 10 percent or fraction thereof of the total workforce. To reduce the level of effort involved inappointing members of the special negotiating body, no general election or delegates election is held.Rather, an election is held by an election committee using the existing works council structures. Theelected employee representatives at the respective highest levels (works council, central works council,group works council) should decide on the domestic members to be appointed to the special negotiationbodies. If multiple company groups are involved, their representatives form a joint election committee.The maximum number of members on the special negotiation body is 40. Only in exceptionalcircumstances – in the absence of an employee representation – may the workforce elect the domesticmembers of the special negotiation body directly.
Standard rulesIf no agreement is reached on employee involvement, a set of standard rules apply. These comprise twoparts which largely match the distinctions applied under German co-determination law.
SE works councilThe transnational information and consultation of employees in an SE is ensured by the formation of aEuropean/SE works council. The representative body is proportionally comprised of representatives fromthe Member States in which the SE employees are employed. SE Works Council members fromGermany are elected by an election committee.
Participation in the supervisory or administrative boardEmployee involvement in SEs is subject to the statutory standard rules which follow the ‘before and afterprinciple’. The number of employee representatives in the supervisory or administrative board is based onthe highest proportion of employee representatives from one (or multiple) founding companies. Thisapplies where an SE is created as a result of a merger if at least 25 percent of the employees from thefounding companies or their subsidiaries have co-determination rights. If a holding SE or a subsidiary SEis to be created, at least 50 percent of the employees in the participating companies and subsidiariesmust have co-determination rights. When an SE is created through transformation, the existing co-determination arrangements are upheld. If the percentage thresholds stated earlier are not achieved, thespecial negotiating body representing the employees must pass a special resolution to approve thehighest proportion of employee representatives in one (or multiple) founding companies.Members of the supervisory or administrative boards who come from Germany are elected by an electioncommittee.
Co-determination in a European cooperative society (SCE) under theAct on Employee Participation in European Cooperative Societies(SCEBG)The SCE Implementation Act (SCEAG) and the SCE Employee Participation Act (SCEBG) transpose EUprovisions on European cooperative societies into German law. The SCEBG governs employeeparticipation in an SCE.The SCE is modelled on the SE. The two acts are near-identical in the arrangement and substance oftheir provisions. Employee participation rights are secured by the same principles in an SCE as in an SE(the ‘before and after’ principle, negotiation procedures and standard rules). As the implementing acts
- 48 -largely contain the same provisions (in particular regarding the election committee, composition of specialnegotiation bodies and negotiation procedures), the rules on co-determination in a European companyapply as described above.The main differences between an SE and an SCE are contained in the provisions for its initialestablishment. Unlike an SE, an SCE’s founding membership can be made up wholly or partly ofindividuals.
Employee participation in the event of cross-border mergers oflimited companies under the Act on Employee Participation in theEvent of Cross-Border Mergers (MgVG)The MgVG transposes the labour law provisions of the Directive on Cross-Border Mergers of LimitedLiability Companies (the Tenth Company Law Directive) into German law. After the European Company(SE) and the European Cooperative Society (SCE), this represents a further key step in themodernisation of European co-determination law. The company law provisions has been transposed intoGerman law by revisions to the law on business transfers.The MgVG resembles the SEBG and the SCEBG not only in the arrangement of its sections; in manyinstances, its provisions are identical in wording or at least in substance. This is particularly the case asconcerns the formation and composition of special negotiating bodies and the negotiation procedures.The rules for SEs and SCEs apply with regard to these points as described above.Despite the many common features, there are a number of important differences relative to the provisionson SEs and SCEs:
Focus on participation in corporate decisionmakingUnlike with SEs and SCEs, the Tenth Directive and the MgVG only cover employee participation incorporate decisionmaking. They do not cover cross-border employee information and consultation, whichare provided for with regard to SEs and SCEs.
National law or negotiated solutionAs the outcome of a cross-border merger under the Tenth Directive is not a new form of European legalentity but a company incorporated under the national law of a member state, employee participation is bydefault governed by national law. In departure from this general rule, employee participation isdetermined by negotiation or, if negotiations fail, by standard rules if any one of the following exceptionsapplies:One of the companies involved in the cross-border merger operates an employee participationsystem and its average workforce exceeds 500 in the six months before publication of the draftmerger terms.National law applicable to the company resulting from the cross-border merger does not providefor at least the same level of employee participation as is operated in the merging companies.National law applicable to the company resulting from the cross-border merger does not giveemployees of units in other member states the same entitlement to exercise participation rightsas is enjoyed by employees in the member state where the company has its registered office.These requirements are such that one or other of them (often the third) will be found to apply in mostcross-border mergers, as a result of which employee participation will normally be determined bynegotiation.
Modified standard rulesIf negotiations fail, standard rules take effect to safeguard existing employee participation rights. For acompany established by cross-border merger, however, the Tenth Directive sets the threshold forautomatic application of the standard rules at one-third (compared with 25 percent for SEs and SCEs).That is, participation in corporate decisionmaking must have covered at least one third of the workforceprior to registration of the merged company. Below this threshold, the special negotiating body can decideto introduce employee participation in the merged company by special resolution.
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Application of the standard rules without prior negotiationUnder the law governing SEs, the standard rules apply if the parties agree that they should or ifnegotiations to determine employee participation rights fail. In line with European law, the MgVG providesa further opening for application of the standard rules. The managements of the companies involved in across-border merger can choose without prior negotiation to be subject to the standard rules for employeeparticipation from the merger registration date. Management does not have this unilateral option underthe law governing SEs and SCEs.
Safeguarding employee participation in the event of subsequent domestic mergerThe basic principle of protecting established rights continues to apply to the company resulting from across-border merger if it subsequently becomes party to one or more domestic mergers. This protectionof employee participation rights ends without exception three years after registration of the cross-bordermerger. Once this three-year period has elapsed, national employee participation rules apply.
The LawThe following laws form the legal basis for co-determination:Co-determination Act of 1976One-Third Participation ActCoal, Iron and Steel Industry Co-determination ActSupplementary Co-determination ActAct on Employee Participation in European CompaniesSupplementary Co-determination ActAct on Employee Participation in European CompaniesSCE Employee Participation ActAct on Employee Participation in the Event of Cross-Border Mergers
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Minimum WageMindestlohnIn certain circumstances, individual employees have a statutory right to receive aminimum wage from their employer. This is laid down in the Posting of Workers Act(Arbeitnehmer-Entsendegesetz, or AEntG) and the Minimum Working Conditions Act(Mindestarbeitsbedingungengesetz, or MiArbG). Both of these acts make possible thesetting of sector-specific minimum wage levels. The Posting of Workers Act was recastand the Minimum Working Conditions Act modernised in 2009.
Your rightsIn certain sectors, you have a right as an employee to be paid a minimum wage by your employer. Theamount of the minimum wage may differ according to the type of work, your level of training and theregion where you are employed.
Posting of Workers ActThe Posting of Workers Act provides a legal framework for setting binding sector-specific minimum wagesfor all employees in a sector, regardless of whether the employer or temporary employment agency isbased in Germany or in another country.Minimum wages under the Posting of Workers Act are restricted in applicability to sectors covered by theAct.The sectors covered are:Construction and related tradesIndustrial cleaningLetter mail servicesSecurity servicesSpecial mining services (in coal mines)Laundry services (business to business)Waste management services including street cleaning and grittingTraining services under Book II or Book III of the Social CodeCare sector (care of the elderly and non-residential nursing care)A further requirement is that a collective minimum wage agreement must be in place and extended to theentire sector by declaration or ministerial order.Minimum wages can be set for the care sector by ministerial order on recommendation of a commissionof eight sectoral representatives.The minimum wage stipulations only apply for enterprises and self-contained parts of enterprises whosemain business consists of providing the sector-specific services in question. Whether the main businessof an enterprise or a self-contained part of an enterprise consists of providing certain services isdetermined according to whether provision of those services accounts for the majority of the workforce’stotal annual working hours. The extended collective agreement may impose further restrictions.
Minimum Working Conditions ActUnder the Minimum Working Conditions Act, minimum wages can be stipulated for sectors in which theapplicable collective agreement is binding for less than 50 percent of the sector. The decision concerningwhether to lay down minimum wages for a specific sector is made by experts of the main committee onminimum wages set up by the Federal Ministry of Labour and Social Affairs. The minimum wage levelsare set by a committee of sector representatives. At the suggestion of the Federal Ministry of Labour andSocial Affairs, the minimum wages set by the sectoral committee can be made binding by governmentorder for all sector employers and employees.
- 51 -Temporary Employment ActIf proposed by the collective bargaining parties for temporary employment, the Federal Ministry for Labourand Social Affairs (BMAS) can determine a binding minimum wage independent of whether, in theircapacity as the employer, the temporary employment agency is domiciled in Germany or in anothercountry. Temporary employees are entitled to payment of amounts which at minimum equal the minimumdetermined wage. If a collective bargaining agreement on temporary employment provides for paymentwhich is less than the minimum determined wage, the employees affected are entitled to be paid in anamount equal to that paid to comparable permanent employees in the hiring company (Entleihbetrieb).The First Ordinance on a Minimum Wage for Temporary Employees (erste Verordnung zur Festsetzungeiner Lohnuntergrenze in der Arbeitnehmerüberlassung) entered into force on 1 January 2012.
Minimum wage levelsMinimum wage levels are not set in the acts themselves, but in the declarations and orders issued underthem. The minimum wage levels are published and regularly updated on the website of the FederalMinistry of Labour and Social Affairs (www.bmas.de) and that of the German customs service(www.zoll.de).
Claiming the minimum wageEmployees have an enforceable claim against employers to be paid their minimum wage. In case ofdispute, employees can file action with a labour court to claim their minimum wage.
Time limits for claimsClaims under a contract of employment are subject to the normal three-year statute of limitations. Theright to be paid a minimum wage cannot be forfeited. It can only be waived in a court settlement. Underthe Posting of Workers Act, time limits for claiming a minimum wage are only admissible if they arepermitted under the applicable collective agreement and amount to six months or longer; under theMinimum Working Conditions Act, such time limits are not permitted.
Compliance monitoringThe customs and excise authorities are authorised to verify that employers comply with the conditions ofemployment under the Posting of Workers Act, the Minimum Working Conditions Act and the TemporaryEmployment Act. Failure to comply with the obligation to pay a minimum wage is an administrativeoffence and subject to fines of up to€500,000.
The lawThe laws governing minimum wages are:Posting of Workers ActMinimum Working Conditions ActTemporary Employment Act
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Health and safety at workArbeitsschutz, UnfallverhütungWorkers need safety. Their health and lives have to be protected from dangers thatarise at work. Systems for health and safety at work provide this protection.Your employer is responsible for health and safety at your workplace. Employers mustset up and maintain the workplace, tools, machines, plant and equipment so that you,the employee, are protected from safety and health hazards. They must take action toprevent accidents at work and occupational health hazards, and to provide anappropriate working environment. They must do this by law, under national health andsafety regulations—specifically the Health and Safety at Work Act—and accidentprevention codes published by the accident insurance funds.Health and safety at work affects the following interrelated areas:The workplace, including workplace hygieneTools, machinery, plant and equipmentHazardous substancesPrescribed working hoursProtection of specific groupsOrganisation of workplace health and safetyPreventive occupational health careLoad handlingBiological agentsNoise and vibrationArtificial optical radiation
Your rightsThe rules and regulations on health and safety at work apply to all employees—including agriculturalworkers and public employees.Children and young people enjoy special protection under the Protection of Minors at Work Act. By law,only young people aged between 15 and 17 (i.e. they have not yet reached their 18th birthday) may go towork.As an employee, you are insured against occupational accidents and diseases with a statutoryoccupational accident insurance fund (see also the Accident Insurance chapter). For most employees thiswill be an industrial employers’ liability fund, whose members are the employer companies themselves.The liability funds have set up technical inspectorates. Together with the health and safety inspectoratesin the various Länder (federal states), these make sure that all health and safety requirements are strictlyobserved and that all installed protective equipment is used.
Legal foundationsRules on health and safety at work are to be found in various acts and regulations, and in the accidentprevention codes published by the employers’ liability funds.There are health and safety rules for specific sectors of trade and industry, for specific manufacturingplant, for workplace organisation and design, and so forth. Here are some other examples:Rules on the design and use of machinery and equipmentRules on the use of specific substances that are needed in production processesRules that apply to specific groups of people
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Some typical health and safety lawsHealth and Safety at Work ActThe Health and Safety at Work Act (Arbeitsschutzgesetz) places youremployer under a duty to assess the hazards at the workplace, takeappropriate preventive measures, and instruct you about themeasures used. Your employer must take precautions for especiallyhazardous areas and situations and provide preventive occupationalhealth care. If you are in immediate danger you have the right to leaveyour workplace without fearing for your job. The Act gives you theright to submit suggestions to the company health and safety officer.You can also complain to the inspectorates about inadequate healthand safety provision at your workplace without fear of retribution,provided that you have already taken your complaint to your employerand nothing has been done about it.
Your obligationsNot all hazards and sources ofdanger can be eliminated oravoided by technical ororganisational means. There willalways be hazards in anyworkplace. This places you as anemployee under an obligation tobe safety-conscious and supportyour employer with regard tosafety precautions.Accident prevention regulationstoo include rules on conduct for allemployees who use tools, plantand equipment. As an employee,you are also required to observerules of conduct specificallydevised by your employer for yourworkplace. In case of healthproblems in the workplace youhave the right to preventiveoccupational healthcare.
Company Doctors, Safety Engineers andOther Occupational Safety Officers Act (Safetyat Work Act)
The Safety at Work Act (Arbeitssicherheitsgesetz) places employersunder a duty to appoint appropriately qualified officers to support themin occupational health and safety matters, including ergonomic workplace design. The duties of theoccupational health and safety experts include advising employers in the entire range of health and safetyfactors in the working environment. This begins with the planning of operating facilities and thepurchasing of equipment, and extends to advising employers in the assessment of working conditions.Among other things, company doctors perform medicals and advise employees in work-related healthmatters. The Act is further defined by accident prevention rules drawn up by the statutory accidentinsurance funds (such as Berufsgenossenschaften for the non-agricultural private sector). Accidentprevention regulations for company doctors and occupational health and safety officers (Betriebsärzteund Fachkräfte für Arbeitssicherheit, or BGV A 2; from 1 January 2011: DGUV Regulation 2) providesmall and very small businesses with flexible and realistic rules that focus on actual risk potential. Thestandard provision for workplaces with more than ten employees was improved with effect from 1 January2011. This now consists of basic provision with set availability times and workplace-specific provision thatcan be tailored to workplace needs. The list of services to be provided reflects modern needs. Public-sector accident insurance funds were involved in the reform of DGUV Regulation 2, resulting in the firstjoint accident prevention regulation for Berufsgenossenschaften and accident insurance funds.
Working Hours ActThe Working Hours Act (Arbeitszeitgesetz) lays down the maximum length of the working day, minimumbreaks during working hours, and minimum periods of rest after work for the protection of workers’ healthand safety. Specific protection is provided for night workers. There is a general ban on Sunday andholiday working, with exceptions in special circumstances.
Protection of Minors at Work ActThe Jugendarbeitsschutzgesetz protects children and young people from overwork. For example, itspecifies a minimum working age, how long minors may work, and how much annual holiday they mustbe granted. The Ordinance on the Protection Against Child Labour sets out in more detail the types of‘light employment’ allowed by way of exception and deemed suitable under the Protection of Minors atWork Act for children from age 13 and for older children required to attend school full time are given in theProtection of Children at Work Regulations.
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Protection of Working Mothers ActThe Mutterschutzgesetz has provisions to protect working mothers and their children from hazards,overwork, and damage to their health at work.
Product Safety ActOnly equipment that meets various safety and other requirements may be marketed and sold inGermany. This is governed by the Product Safety Act (Produktsicherheitsgesetz) and its subordinateordinances, and applies both to consumer goods and to products used by employees in the workplace.The Act also provides the basis for national implementation of European regulations that allow only safeproducts to be sold within the European Community.Consumer goods and technical equipment must not create risk of accidents or a threat to human health.Responsibility for ensuring this lies with all who place products on the market – producers, importers anddistributors alike. These must ensure the products they make and sell do not pose a danger to userhealth and safety.
Occupational Health RegulationsOccupational health provision serves to inform and advise employees about interactions between theirwork and their health and is an important back-up to technical and organisational work health and safetymeasures. It helps prevent work-related illness and maintains individuals’ ability to work. The regulationsgovern employer and physician obligations, guarantee employee rights, provide transparency regardingthe need for mandatory and optional health examinations, and encourage employees to request medicalcheck-ups. They prescribe the separation of work-related health examinations and aptitude physicals,which may be required under employment and data protection law. These new regulations (Verordungzur arbeitsmedizinischen Vorsorge) aim to improve not-yet-adequate services on things like muscular-skeletal disorders. The new Occupational Health Committee (Aussschuss für Arbeitsmedizin) plays a keyrole in these endeavours.The Occupational Health Committee’s responsibilities include drawing up rules that correspond to thecurrent state of knowledge in occupational health, making recommendations on preventive occupationalhealth care, and formulating the regulations in more concrete terms.
Personal Safety Equipment RegulationsThe personal safety equipment regulations (PSA-Verordnung) mainly relate to the selection, provisionand use of personal safety equipment in all sectors. Employers must also ensure that employees areinstructed in the proper use of such equipment.
Load Handling RegulationsThe load handling regulations (Lastenhandhabungsverordnung) govern health and safety in manual loadhandling where there is a health risk to employees, and particularly where there is danger of lumbarinjury. Employers must avoid manual load handling where possible. Where manual load handling cannotbe avoided, employers must ensure the highest possible level of safety and least possible health risk toemployees. For this purpose, working conditions are assessed to decide appropriate health and safetymeasures.
Construction Site Health and Safety RegulationsThe provisions of the construction site health and safety regulations (Baustellenverordnung) aim toreduce the enhanced accident and health risks inherent in construction work relative to other industriesand to improve the safety and health of construction workers. The main elements of the regulationsinclude communication of prior notice in a specified manner, the drawing up of a safety and health plan,and the appointment of a coordinator. These elements are calculated to improve the planning andcoordination of construction projects so that dangers to workers can be identified and eliminated at anearly stage.
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Video Display Workstation RegulationsThe video display workstation regulations (Bildschirmarbeitsverordnung) consolidate the rules onemployee health and safety in the use of video display workstations. All employers must comply. Theregulations include minimum requirements for the display equipment itself, the workplace and workplaceenvironment, together with software and workflow organisation. They also require the provision ofprofessional eye examinations.
Work Equipment RegulationsThe Workplace Safety Regulations (Betriebssicherheitsverordnung) set out objectives and provisions toensure that the use of tools and machinery does not endanger employees’ health and safety. Theregulations also govern the broad measures in place to protect employees and third parties in the use ofequipment that requires supervision. Such equipment includes steam boilers, pressurised containers andelevators.
Workplaces RegulationsThe workplaces regulations (Arbeitsstättenverordnung) specify how factories, workshops, offices andadministrations, warehouses and shops must be equipped and operated to prevent risk to employees’health and safety. The regulations cover things like dimensions, ventilation, lighting and temperatures.
Hazardous Substances RegulationsIn force since 2010 following a major revision, the hazardous substance regulations(Gefahrstoffverordnung) provide a modern, flexible instrument with which to protect employees in the useof hazardous substances and especially hazardous chemicals.The regulations provide employers with additional scope in the selection of works-specific protectivemeasures because only they know the full extent of the working conditions at their facilities. Rules onassessing the degree of harmfulness and on implementing safety measures graded to hazard levels helpemployers in deciding what needs to be done. Placing greater responsibility with employers is coupledwith clearly worded requirements on the procedures that need to be in place. In cases where moredetailed stipulations are required than the regulations provide, the Hazardous Substances Committee(AGS) drafts Technical Rules on Hazardous Substances (TRGS). Compliance with the regulations ispresumed if these rules are followed. Nevertheless, employers still have the freedom to implementmeasures other than those contained in the technical regulations as long as they are appropriate,adequate and justifiable.The regulations contain a number of annexes which set out detailed rules for special areas requiringparticular attention with regard to work safety.
Biological Agents RegulationsThe biological agents regulations (Biostoffverordnung) provide a cross-sectoral legal framework to protectemployees who come into contact with biological agents (microorganisms). By categorising biologicalagents that arise in the workplace into four risk groups, protective measures can be defined to protectemployees against infection and any sensitising or toxicological effects.The regulations protect some five million workers who come into contact with biological agents(pathogens) in their work in biotechnical product research and in the food, agriculture, waste disposal,waste water and health care sectors. To cover this wide area, the regulations take the form of uniformand flexible basic rules so that employers can define and implement protective measures to deal with thespecific hazards that apply in each case. The regulations are further defined in the associated technicalregulations (TRBA) drawn up by the Biological Agents Committee (ABAS)Issues such as bird flu and H1N1 (swine flu) are making the protection of employees who come intocontact with such pathogens a focal point of everyday activity.
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Noise and Vibration in the WorkplaceThe Ordinance on the Control of Noise and Vibration in the Workplace (Verordnung zu Vibrationen undLärm an Arbeitsplätzen) transposes the EU Physical Agents (Vibration) Directive (2002/44/EC) and theILO Working Environment (Air Pollution, Noise and Vibration) Convention, 1997 (No. 149) into nationallaw. The Ordinance serves to improve health and safety conditions for employees in the workplace.The legislation is designed to prevent noise-induced hearing loss (one of the most frequent work-relateddisorders), muscular and skeletal disorders and neurological defects that can arise from long periods ofexposure to strong vibration.
Occupational Safety Regulations on Artificial Optical RadiationThe new Occupational Safety Regulations on Artificial Optical Radiation (Arbeitsschutzverordnung zukünstlicher optischer Strahlung) transpose European health and safety directive 2006/25/EC into Germanlaw. The focus is on protecting employees from risks of artificial optical radiation at work.Harmful effects, notably to the eyes and skin, of exposure to artificial optical radiation are to be avoidedby observing stipulated exposure limits. Artificial optical radiation can cause harm including thermal skinburns, erythema from exposure to ultraviolet light, phototoxic reactions, epithelial and conjunctivaldamage to the eye, and thermal damage to the retina. Long-term ultraviolet and infrared exposureincreases the risk of cataract. Long-term ultraviolet exposure can also result in genetic damage. Inconsequence, even very minor exposures can have delayed effects in the form of skin cancer.Harmful artificial optical radiation notably arises in welding, glass and quartz processing, metalmanufacture and processing, and in laser applications that are coming into increasingly frequent use.Exposure to optical radiation from artificial sources (such as laser or ultraviolet/infrared radiation) can leadto serious eye and skin damage and is therefore a health and safety hazard to many employees at work.Short-run harm may take the form of skin burns and epithelial, conjunctival and retinal damage to the eye.Long-term exposure to intense ultraviolet radiation can have delayed effects in the form of skin cancer.Preventive measures under the Regulations aim both to improve employee health and safety and toreduce costs of social security systems.
Book VII of the Social CodeThis places the employers’ liability funds under a duty to use all appropriate means to preventoccupational accidents, occupational diseases and occupational health hazards, and to ensure that thereare adequate first aid facilities at the workplace. Based on the Act, and after a mandatory needsappraisal, the liability funds issue accident prevention codes that are legally binding on their members(companies) and on insured workers. Technical inspectors make sure that the accident prevention codesare observed and advise the companies and insured workers.
Federal Ministry of Labour and Social Affairs Programme of ModelProjects to Combat Occupational DiseasesThe Federal Ministry of Labour and Social Affairs has specifically funded model projects relating tooccupational health and safety since 1993. The model projects assist employers in practicalimplementation of work safety measures and in structuring working conditions at their facilities. Bypublishing and distributing available knowledge, the projects contribute to reducing work-related healthrisks and disease in Germany’s production, crafts and trades and services sectors. They thus boost thecompetitive standing of German business. The focus of funding in 2010 was on demographic change inthe construction industry. This involved the development, testing and long-term implementation of best-practice examples for maintaining people’s working capacity and employability.
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New Quality of Work InitiativeAfter 10 years of intensive effort surrounding the New Quality of Work Initiative (INQA), the FederalMinistry of Labour and Social Affairs plays a key role in its implementation and in talks with majorstakeholders, providing stimulus for the initiative’s further advancement and refinement. The aim was torestructure and refocus the INQA to enhance its impact, and to broaden its reach and audience in thebusiness environment. The realignment was initiated against the backdrop of businesses having to tacklethe social and business-related challenge of demographic change, which will become more readilyapparent in the near future. Workforces are ageing, with up to half the number of employees havingattained middle-age. As this group will age ‘en mass’, they will all go into retirement within then next 10 to15 years. There is already evidence of a swing in the jobs market: It is becoming less employer-dominated and more employee-driven. Thus, companies are called upon to improve their innovativenessand there attractiveness as an employer by adopting new methods of recruitment and providing newemployment opportunities. In light of the trends in employee potential, an approach that focuses more onexisting potential and on supporting existing employees to help them remain in their jobs into old age.The INQA focuses on the findings described above. Its main aim is to heighten awareness of theseissues among employers, and especially to give small and medium-sized businesses (SMEs) guidanceon how they can prepare for the challenges ahead. Under the INQA, ‘businesses of the future’ are thosewhich declare their commitment to maintaining employees’ workability and promoting their employability.They strive to build a workforce-focused corporate culture based on fair, health-oriented employmentconditions. They do so to provide the basis for lasting business viability – healthy, competent andmotivated employees – to remain competitive in recruiting skilled workers and winning market share.The following shows the four-pillar model developed by Professor Illmarinen which illustrates the keyhuman resources activities for businesses of the future.Business of the FutureHR ManagementLeadership andCommunicationParticipation andMotivationWork Organisation andWorking HoursEqual Opportunities &DiversityWork-Life BalanceDemographyInclusionWomen in the WorkplaceFair and Reliable Working ConditionsSource: BMAS table (after Illmarinen and Tempel, 2002)
HealthPhysical and MentalHealthOrganisational andIndividual Resilience
Knowledge & SkillsHR DevelopmentLifelong LearningKnowledge Transfer
The model takes in:Human Resources management which promotes a workforce-focused corporate cultureThe achievement of equality and diversity within the company to provide opportunities foremployees regardless of their age, gender or ethnic origin, foster their creativity and willingnessto perform, and opens up new career paths.Adopts a systematic approach to maintaining the health, workability and employability sonecessary to tackle the issues of an ageing workforce and a lack of skilled workersPro-active, targeted knowledge and skills management based on the principle of life-long learningto make use of and further develop employees’ potential, knowledge and abilities.These activities serve in giving structure to company-provided content, information and advisory services,project promotion, and so on.Apart from refocusing INQA activities, structural changes were also carried out. A Steering Committeewas established whose responsibilities include:Determining the main focus of INQA activities. This is done at the end of a year for the followingyear
- 58 -Reviewing proposals from researchers and experts, evaluating project design documents aspart of the public announcement processMaking recommendations on projects requiring funding, which must be approved by the BMAS.
The Steering Committee comprises the key INQA sponsors, with representatives from the BMAS and thefollowing associations and institutions, and responsible others:Members of industry: The Confederation of German Employers’ Associations(Bundesvereinigung der Deutschen Arbeitgeberverbände (BDA), the Federation of GermanEmployers’ Associations in the Metal and Electrical Engineering (M+E) industries (Gesamtmetall),the Federation of German Employers in the Chemicals Industry (BAVC), the GermanConfederation of Skilled Crafts (Zentralverband des Deutschen Handwerks (ZDH), and theAssociation of German Chambers of Industry and Commerce (DIHK).Employee representations: German Confederation of Trade Unions (DGB), GermanMetalworkers Union (Industriegewerkschaft Metall (IGM), Industrial Mining, Chemcials andEnergy Unions (IG Bergbau, Chemie, Energie (IG BCE)), United German Services Unions(ver.di), and Food and Restaurant Workers’ Union (Gewerkschaft Nahrung, Genuss, Gaststätten(NGG).The Länder Conferences of Labour and Social Affairs Ministers (ASMK)The Federal Employment Agency (BA)Four topic ambassadors as experts on the four Human Resources areasTwo special INQA representatives, one from the industry associations (Professor RandolfRodenstock) and one from the unions (Alfred Löckle).
Companies that are committed to the four pillars of the Business of the Future model (see above) investin their competitiveness, their attractiveness for skilled workers and thus in their future. The BMASbelieves that Germany lacks small-scale services which are especially tailored to the (advisory) needs ofSMEs in order to help them on their way to becoming future-ready businesses. In an effort to change thesituation, a range of services have been developed as part of the INQA initiative. Three main services arenow in place to assist businesses (especially SMEs) to overcome the challenges involved in demographicand structural change in the working world:In the INQA ‘Guter Mittelstand’ Business Check, employers can complete an online self-analysisto identify how well their company is placed in terms of demographic change and market-relateddemands. The analysis identifies specific business and HR policy needs and provides eithersolution approaches or names potential advisers.The voluntary INQA ‘Business of the Future Audit’ offers a professional support process to helpboost corporate culture, innovativeness and competitiveness. It provides employers with clarityon how future-focused their business and the HR policies are and where there is scope forimprovement.The INQA ‘Deutschlands Bester Arbeitgeber’ competition (Germany’s best employer) combines acompany survey (which includes employees) on workplace culture with a benchmarkingcomponent in which companies can measure their performance against one another and boosttheir image as an attractive employer.
Alongside the above measures, the ESF program, ‘unternehmensWert: Mensch’ (people: a businessasset), which targets SMEs with up to 249 employees, assumes up to 80 percent of related advisorycosts.Another aim of the initiative involves a regionalisation strategy which is designed to highlight theimportance and objectives of the issues in question, and raise public awareness to them. BMAS will alsocontinue to fund projects, albeit with greater focus on transfer and model projects designed to developbusiness-related approaches and instruments to maintain workability and enhance employability.In other words, after 10 years intensive effort, the New Quality of Work Initiative (INQA) has beenrealigned while maintaining ‘business as usual’. In conjunction with key partners, thematic initiativegroups and business networks, the INQA supports the achievement of a ‘new quality of work’ whichfocuses both on employees’ workability and employability, and on companies’ competitiveness in the faceof demographic change.
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InformationIf you have questions about health and safety or accident prevention youcan contactArbeitsschutz und Arbeitsmedizin (Federal Institute of Occupationalseveral places for advice:In each of Germany’s Länder there is a special health and safetyauthority: the Amt für Arbeitsschutz (health and safety office) or theGewerbeaufsichtsamt (labour inspectorate).The Bundesanstalt für Healthand Safety) offers aninformation line on health andsafety at work, availableMondays to Fridays 8 am to4.30 pm on 0180 3214321(€0.09 per minute withinGermany).
The occupational accident insurance funds each have their own technical inspectorates.The Bundesanstalt für Arbeitsschutz und Arbeitsmedizin (Federal Institute of Occupational Health andSafety) conducts research and provides advice and training on all aspects of health and safety at work.
Reportable occupational accidents: Absolute numbers and per 1,000 full-time workers1960 – 2009Reportable occupational accidents(1,000)From 1991: including data fromformer East GermanyReportable occupational accidentsper 1,000 full-time workers
3,000Reportable occupational accidents
2,5002,0001,5001,000974,642
500Reportable occupational accidentsper 1,000 full-time workers
25.81
0
1 )A change in the estimated number of full-time workers covered by statutory accident insurance and prevention institutions for theagricultural sector resulted in a major change in accident rates from 2008.
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Occupational accident insuranceUnfallversicherungGermany’s statutory occupational accident insurance (Unfallversicherung) wasestablished in 1884. Today, it is provided by industrial, agricultural and public-sectoremployers’ liability insurance funds.
Who is insured?Regardless of how much you earn, you are automatically covered if you are employed or in training.Statutory occupational accident insurance also covers:FarmersChildren attending nursery school or in the care of suitable day-care providersChildren in schoolStudentsPeople helping at the scene of an accidentCivil defence and emergency rescue workersBlood and organ donorsHome carersIn some voluntary activities, volunteersIf you have a business or are self-employed and are not already required to carry insurance by law orunder the rules of the employers’ liability insurance funds, you can obtain insurance coverage on avoluntary basis for yourself as well as your spouse if he or she works with you. Special occupationalaccident insurance provisions apply to tenured civil servants (Beamte).
Benefits and conditionsStatutory occupational accident insurance protects you and your family against the consequences ofaccidents at work and occupational illnesses that can arise in the course of practising your occupation.In addition, it contributes towards the prevention of occupational accidents, occupational illnesses andjob-related health hazards.In the event of an occupational accident or occupational illness, statutory occupational accident insuranceprovides:Payment for full medical treatment.Occupational integration assistance (including retraining if necessary).Social integration assistance and supplementary assistanceCash benefits to the insured and their surviving dependants.Important: Statutory occupational accident insurance provides benefits regardless of fault. Employers’and employees’ statutory liability toward one another is transferred to their occupational accidentinsurance.Your insurance covers you as long as you are carrying out an insured activity or are travelling to or fromwork. If you are in a car pool, you are also covered on the way to and from work, even if your poolingroute is not the most direct one to your place of work.
If you are insured, you can claim:Medical treatmentIf you have an accident or suffer an occupational illness, your occupational accident insurance will coverthe costs of medical treatment, any necessary medication, dressing materials, therapies or aids, hospitaltreatment or treatment in a rehabilitation centre, for an unlimited period.
- 61 -You will not be required to pay patients’ contributions for drugs, remedies and aids or a consultation fee(Praxisgebühr). As before, your accident insurance will meet all costs.
Injury benefitYou receive injury benefit as long as you are unable to work and your employer is not paying you. Injurybenefit is 80% of the pay before deductions you lose as a result of your accident, up to a maximum ofyour pay after deductions. Injury benefit is granted for a maximum of 78 weeks.
Occupational integration assistanceIf you are unable to return to your present employment because of an accident at work or occupationalillness, you can claim occupational assistance. This primarily comprises help allowing you to retain yourpresent employment or to obtain new employment. If this does not succeed, you can undergo retraining.You will then receive a transitional allowance. This is reduced by the amount of any income fromemployment you earn at the time.
Social integration assistance and supplementary assistanceThese benefits include financial assistance to modify your car or home to meet your needs, domestichelp, psychosocial counselling and rehabilitative sport. They are granted in addition to medical treatmentand occupational integration assistance if the nature and severity of your injury or illness makes themnecessary.
Pension for insured personsYou will receive a pension if an accident at work or an occupational illness reduces your earning capacityby at least 20% for 26 weeks (at least 30% in the case of farmers, their spouse or civil partner and familymembers who work on the farm). The amount of this pension depends on the extent to which yourearning capacity has been reduced and on the amount you earned during the 12 full calendar monthsprior to your occupational accident or illness.Important: Like statutory old-age pensions, pensions payable under occupational accident insurance areadjusted annually.
Nursing care allowanceIf you require nursing care as a result of a work accident or an occupational illness, you are entitled tonursing care benefits, a nursing care allowance or, if necessary, residential care in addition to your injurypension.
Funeral allowanceIf you die from an accident at work or an occupational illness, your surviving dependants will receive afuneral allowance which is equal to one seventh of the reference income level at the time of your death(the reference income level is the average level of income from employment assessable for statutorypension insurance).
Surviving dependant’s pensionIf your spouse dies as a result of an accident at work or an occupational illness, your occupationalaccident insurance will pay you a surviving dependant’s pension (unless and until you remarry). Theamount of this pension is determined by your age, your earning capacity or ability to work in youroccupation, and the number of children you have. For example, you receive an annual survivingdependant’s pension equivalent to 40% of your deceased spouse’s annual income before deductions ifyou meet any one of these conditions:You are 45 or older and your spouse dies before 1 January 2012You have reduced earning capacity, are occupationally disabled or are an invalidYou have at least one child who is entitled to an orphan’s pension
- 62 -For deaths that occur after 31 December 2011, the age limit of 45 will be raised to 47 as part of a phasedprocess; this is in line with the raising of the age limit for surviving dependant’s pension under the statepension scheme.If you are not yet 45 (47) and have no children, your annual pension entitlement is 30% of your deceasedspouse’s annual income before deductions, payable for two years. The entitlement extends beyond twoyears for an unlimited period (unless and until you remarry) in the case of deaths before 1 January 2002and in the case of couples married before 1 January 2002 where one partner was at least 40 years old atthe time.Important: If you are a surviving dependant, 40% of any income you may have (from employment oranother pension, for example) will be offset against your surviving dependant’s pension, after deductionof an index-linked allowance (which increases for each child you have who is entitled to an orphan’spension).
Orphan’s pensionIf you die as the result of an accident at work or an occupational illness, any children you have who areunder 18 years of age will receive an orphan’s pension. Occupational accident insurance will pay apension equal to 20% of your annual income before deductions to your children when they still have oneparent, and 30% when they have lost both parents.Orphans’ pensions are paid even beyond the age of 18 (the usual cut-off age). Such pensions are paid upto age 27 for orphans who are:Attending school or in vocational trainingDoing a year of voluntary social or voluntary environmental work under legislation governingvoluntary work by young people or service under the Federal Voluntary Service ActUnable to provide for themselves because of a physical, mental or psychological disabilityIf you are an orphan aged 18 or older, 40% of any income you may have will be set off against yourorphan’s pension, after deduction of an index-related allowance.Important: If the widow’s or widower’s pensions and orphans’ pensions granted to one family exceed 80%of the deceased’s annual income before deductions, they will be reduced accordingly.
Lump-sum settlementIf it is not to be expected that your earning capacity will significantly recover, you can apply to have yourpension paid out as a lump-sum. The procedure differs according to whether your earning capacity isreduced by less than or more than 40%. Up to 40%, the settlement is principally for life; that is, your entirepension claim is settled with a single lump-sum payment. No further pension is paid, unless your healthdeteriorates so much as a result of your accident or occupational illness that you would be entitled to alarger pension. The size of the settlement is determined in accordance with a federal government order,taking into account your age and the time since the accident.If you are 18 or older and your earning capacity has been reduced by 40% or more following an accidentat work or an occupational illness, you can apply to have your pension split: You can receive half of thepension due to you over a ten-year period as a lump-sum settlement (not to exceed nine times your half-yearly pension entitlement) and then receive only half of your pension during the first ten years of yourentitlement. Your occupational accident insurance will pay your full pension starting the 11th year.
FundingVarious employers’ liability insurance funds provide statutory occupational accident insurance for thecommercial and agricultural sectors. It is funded through the contributions paid by employers. Funds inthe agricultural employers’ liability fund receive a federal subsidy. The amount of the employer’scontributions depends on the sum total of employee annual pay and the employer’s respective hazardlevel.Employees, children in school, students, etc. do not pay contributions themselves.
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The lawThe legal framework for statutory occupational accidentinsurance is contained in Book VII of the Social Code (SGB VII).Other applicable laws and regulations, include:Social Code, Book IXRegulations on occupational illnesses
What you have to doYou should notify your employerimmediately if you ever have an accident atwork or on the way to work. Theappropriate institution – nursery school,school, university, etc. – must also benotified in the event of an accident involvinga child or student. Employers are requiredto report accidents to the relevantoccupational accident insurance fund if anyemployees are killed, or if any are injuredsuch that they cannot work for more thanthree days.
Information
Further information is available from the employers’ liability insurance funds (Berufsgenossenschaften)and public-sector occupational accident insurance funds (such as municipal accident insuranceassociations). Occupational accident insurance providers offer a nationwide information line on industrialaccidents, work-related accidents while travelling and occupational illnesses, available Mondays toFridays 8 am to 6 pm on 0800 6050404 (free within Germany).You may also call the Federal Ministry of Labour and Social Affairs helpline from Mondays to Thursdaysbetween 8 am and 8 pm on 01805 676711 (€0.14 per minute within Germany).Additional information is available from various sources on the Internet, including:– www.dguv.deInformation on occupational accident insurance is provided in the following German-language brochuresavailable from the Federal Ministry of Labour and Social Affairs, Referat Information, Publikation,Redaktion, Postfach 500, 53107 Bonn, Germany:Zu Ihrer Sicherheit – Unfallversichert im Ehrenamt (on occupational accident insurance forvolunteers; order no. A 329)Zu Ihrer Sicherheit – Unfallversichert bei häuslicher Pflege von Angehörigen (on occupationalaccident insurance for people providing nursing care for relatives in the home: order no. A 401)Zu Ihrer Sicherheit – Unfallversichert in der Schule (on occupational accident insurance inschools: order no. A 402)
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Rehabilitation and integration of people with disabilitiesRehabilitation und Teilhabe von Menschen mit BehinderungRehabilitation can be defined as all measures undertaken tointegrate disabled people into society. No one in the FederalRepublic of Germany should ever feel marginalised. Which iswhy anyone who is disabled or at risk of becoming disabledand therefore needs special help is entitled to rehabilitationbenefits. The cause of the (potential) disability does not playany part in determining entitlement. A person might needassistance as a result of a war injury, or an accident on theroad or at work. People who are no longer able to work due toillness or physical deterioration – as well as people who wereborn with a disability – may also be in need of some form ofassistance.The German Federal Ministryof Labour and Social Affairsruns a citizens’ informationline on disabilities. Tel. 030221911006 (text telephoneservice for the deaf or hard ofhearing), Mondays toThursdays from 8 am to 8pm, or e-mail atinfo.gehoerlos@bmas-bund.de. A sign-languagetelephone service is alsoavailable Mondays toThursdays from 8 am to 8pm. To use it, you needeither a SIP/IP video phoneor a PC with Softclient and awebcam. gebaerdentelefon@sip.bmas.buergerservice-bund.de
Book IX of the Social Code – Integration and Rehabilitation ofDisabled People – came into force on 1 July 2001. It codifiesand consolidates the law applying to various benefit sectors. Book IX thus now covers anumber of different areas in a similar way to Books I, IV and X. The focus is no longerexclusively on caring and providing for people who are disabled or at risk of becomingdisabled, but on their self-determined participation in society and on the elimination ofbarriers to equal opportunities.The aim is better laws and a better life for the many people who have disabilities or areat risk of becoming disabled. Book IX of the Social Code thus provides for medical,occupational and welfare benefits to achieve this aim quickly, effectively, economicallyand permanently. Accordingly, the benefits have been brought together under theheading of ‘integration assistance’. People who have a disability or are at risk ofbecoming disabled are empowered to conduct their own affairs as far as possibleindependently and on their own responsibility.
Benefits and conditionsIf you have or are at risk of a physical, mental or psychological disability, you are entitled to assistance,regardless of the cause of your disability. You may need such assistance to:Avert, eliminate or reduce your disabilityPrevent your condition from deteriorating or alleviate its effectsThis assistance is provided to help you secure your place in the community – and this includes helpingyou find a suitable place of work that suits your interests and abilities.
Integration assistanceThe following benefits can be provided:
Medical rehabilitation assistanceMedical rehabilitation assistance includes:Medical and dental treatmentPharmaceuticals and dressing materialsTherapies, including physiotherapy, kinesitherapy, speech therapy and occupational therapyArtificial limbs, orthopaedic and other aids including any alterations, repairs and replacementsrequired and training in the use of the aids provided
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Where necessary, medical rehabilitation assistance is provided on an out-patient basis or in rehabilitationclinics on an in-patient basis. Where necessary, the benefits cover any food and accommodation.
Occupational integration assistanceOccupational integration assistance includes:Assistance to help you keep your job or obtain a job, including advice and placement, trainingand mobility assistance.Pre-training measures including any basic training made necessary by your disability (forexample in the case of blindness)Refresher courses, vocational training, further training, or any school-level qualifications requiredfor admission to such coursesOther forms of employment and vocational promotion assistance aimed at making it possible foryou to find and retain adequate and suitable employment or self-employmentSince 2004, employers have had an obligation to offer workplace integration management for employeeswho have been ill for a substantial length of time. The aim of this system is to restore and sustain theemployability of employees who have fallen ill, thus avoiding job loss.When selecting forms of occupational rehabilitation assistance, your aptitude, inclinations and previousoccupation are taken into account together with the current situation and outlook on the job market.Occupational integration assistance also covers the cost of food and accommodation when, for example,the nature and severity of your disability is such that you cannot live at home while attending a course, orwhen the success of the rehabilitation measures you are undergoing depends on your beingaccommodated outside your home.
Social integration assistanceThis includes:Special education for pre-school childrenMeasures to assist the individual’s ability to communicateMeasures to promote independent living in sheltered accommodationAssistance with taking part in social and cultural life
Maintenance and other supplementary benefitsDepending upon which fund is responsible, you will generally receive either sickness benefit, sicknessbenefit for war victims, injury benefit or a transitional allowance to ensure that you have enough income tocover your living expenses while receiving medical rehabilitation assistance. Sickness benefit is equal to70% of your income from employment or self-employment on which contributions are assessed. Sicknessbenefit may not exceed 90% of the income net of deductions you forego during your treatment. If thepension insurance fund is responsible, you will be paid a transitional allowance equivalent to 68% of yourlast net earnings instead of sickness benefit. This amount rises to 75% of your last net earnings when youhave dependants.If you are provided with occupational integration assistance, you will generally receive a transitionalallowance in the same amount. If the Federal Employment Agency is responsible for meeting the cost ofyour rehabilitation and you have been covered by unemployment insurance for a designated period oftime, you will receive either a subsistence or a transitional allowance. The Federal Employment Agencywill also pay a training allowance for young disabled persons who are undergoing their first vocationaltraining, provided that certain requirements are met.
Personal budgetTo secure them the greatest possible degree of independence and control over their own lives, peoplewith disabilities and in need of care can apply in place of the various non-cash benefits to receive regularor once-only payments or vouchers so that they can organise and pay the services they needthemselves. The personal budget can also be paid out as an overall budget for all services provided by all
- 66 -agencies. For a trial phase, the agencies could decide whether to grant personal budgets at theirdiscretion; since 1 January 2008, claimants have had a legal right to personal budgets.
FacilitiesVocational youth training centresThese work in conjunction with firms and regions throughout the country to provide initial vocationaltraining for young disabled persons. Young people who require special assistance are trained invocational youth training centres by qualified staff and are supported by a range of different services(doctors, psychologists and teachers) with the aim of fostering their personal and vocational development.
Vocational retraining centresThese also work together with firms and regions throughout the country to provide retraining and furthertraining for disabled adults who can no longer perform either the work they are qualified to do or the jobthey have held so far. As social service providers, they provide qualified staff and support services(doctors and psychologists, for example) to enhance individuals’ vocational and personal skills andabilities.
Vocational training centresVocational training centres are special occupational integration centres for people with psychologicaldisabilities. They aim to help people realistically assess their job perspectives so that they can rejoin themainstream jobs market, go on to a course of training or retraining, or return to employment. Vocationaltraining centres have training places which correspond to workplace conditions and requirements.
Vocational rehabilitation clinicsThese are special rehabilitation centres which cater for specific types of condition or disability and whichtake a fully integrated approach to providing medical rehabilitation and occupational integrationassistance (‘phase II’). There are currently 23 such clinics, which are members of a federal association ofphase II vocational rehabilitation centres.
Sheltered workshopsThese special workshops offer suitable vocational training and jobs for persons who are permanently ortemporarily unable to find employment on the open job market due to the nature or severity of theirdisability. These workshops provide disabled persons with an opportunity to develop, increase or regaintheir ability to work productively and to earn money while doing so.Important: Disabled persons who work in one of these workshops are covered under Germany’s health,accident, long-term care and pension insurance schemes.
Special provisions for people with severe disabilitiesIf your level of disability is at least 50% (your disability level is generally determined by theVersorgungsamt – the war pensions office), special employment protection provisions apply.The special employment provisions mostly relate to protection from dismissal. As a severely disabledperson you are also entitled to additional paid leave (usually five working days).Any public or private-sector employer with more than 20 jobs to fill is required to reserve 5% of them forseverely disabled persons. Some federal agency employers are required to reserve up to 6% of jobs.Jobs occupied by trainees are not included when calculating the number of reserved places. Severelydisabled trainees count as occupying two reserved places. In addition, local employment agencies cantreat a severely disabled person as occupying three reserved places if his or her integration into workinglife presents severe difficulties.
- 67 -A compensatory levy must be paid for each reserved place not assigned to a severely disabled person.The levy is scaled as follows:€105a month for compliance rates of 3% or greater but less than 5%€180a month for compliance rates of 2% or greater but less than 3%€260a month for compliance rates of less than 2%.A spokesperson must be elected to represent disabled employees in any company or organisation thatemploys five or more severely disabled people on an ongoing basis. The spokesperson is responsible forrepresenting the interests of severely disabled employees and promoting their integration in the companyor organisation.In some cases, occupational integration assistance must be supplemented by special assistancemeasures to ensure that a severely disabled person is able to find adequate, long-term employment. Insuch cases, the Federal Employment Agency and the integration offices provide special cash benefitswhich may be used, for example, to customise a workplace by refitting a machine to meet the needs of adisabled employee.As a severely disabled person you can also claim handicap benefits to help compensate disadvantagesarising from your disability. These benefits are normally conditional on the existence of specific healthconditions and include:Tax concessions (in particular, the standard allowance for disabled persons)Free public transportReduced vehicle taxesSpecial parking facilitiesExemption from radio and television licence fees
Severely disabled person’s passAs a severely disabled person, you can apply for a severely disabled person’s pass (Behindertenausweis)at the competent war pensions office. This pass serves as proof of your disability and enables you toclaim handicap benefits.When you apply for a pass, the war pensions office will also ascertain whether you are entitled to specialhandicap benefits. If you are, a corresponding entry will be made in your pass. For example, a ‘G’indicates that you have ‘significantly restricted mobility in road traffic’ and entitles you free public transportor a reduction in your vehicle tax.
Free public transportIf your disability significantly reduces your mobility in road traffic or if you are incapacitated or deaf, youare entitled to free public transport on production of a pass that is marked accordingly. This applies totrams, buses, suburban trains and (second class) railway travel when they are part of and honour thetickets of an integrated regional transport system. Free transport within the Deutsche Bahn AG system orits subsidiary systems is limited to second class travel on local trains within 50 km of your home. You arehowever required to pay any surcharges that may apply to local trains.Deutsche Bahn AG and its subsidiaries will allow you to use local trains free of charge when your passcontains a special stamp and there is a mileage table for your area. These stamps are issued by the warpensions office and cost€60for one year or€30for six months. The 12-month stamps are issued onapplication free of charge to persons who are blind or otherwise incapacitated and whose income doesnot exceed certain limits. This exemption also applies to certain categories of war victims. If you areauthorised to be accompanied by an escort, they will also be allowed to travel free of charge (this alsoapplies to long-distance travel).
Equal treatment of disabled and severely disabled peopleImportant: If your level of disability is between 30 and 50%, under certain circumstances you could beclassed as severely disabled. The employment agency decides whether your disability is equivalent to asevere disability. The requirement is that you would not be able to find a job or keep your present job ifyou were not granted the same treatment as a severely disabled person. If you are classed as a severely
- 68 -disabled person, you can claim the same assistance to foster your integration into employment that isgranted to severely disabled persons (though this excludes additional annual leave and free transport).
Who provides assistanceIn addition to their other duties, each fund in Germany’s social system is also responsible for a particularaspect of rehabilitation and integration:Health insurance provides medical rehabilitation assistance for persons who are insured. Thecost of medical rehabilitation is covered by the following:– Local health insurance funds– Company health insurance funds– Guild health insurance funds– The maritime insurance fund– Alternative statutory funds for wage and salary earners– The federal insurance fund for miners– Agricultural workers’ health insurance fundsGermany’s pension insurance schemes are responsible for providing medical rehabilitation andoccupational integration assistance for their members. These costs are covered by the following:– Deutsche Rentenversicherung Bund (national level)– Regional Deutsche Rentenversicherung funds (regional level)– Deutsche Rentenversicherung Knappschaft-Bahn-See (miners, railway and maritime)The occupational accident insurance funds are responsible for providing medical rehabilitation,occupational integration and social integration assistance following an accident on the job or anoccupational disease. These costs are covered by the following:- Industrial employers’ liability insurance funds- Agricultural employers’ liability insurance funds- Public-sector occupational accident insurance funds (occupational accident funds andmunicipal occupational accident insurance associations)The funds responsible for compensation benefits for disabilities suffered for example by warvictims, persons during the course of military service or victims of violent crime provide entitledpersons with medical rehabilitation, occupational integration and social integration assistance.These costs are covered by the following:- War pensions offices- Local integration officesIntegration offices offer additional assistance when persons who are either disabled or severely disabledface employment-related difficulties. If no other fund is responsible, these offices have the authority togrant financial incentives to employers to provide employment for severely disabled persons.The Federal Employment Agency, its regional directorates and local employment agenciesprovide occupational integration assistance if no other fund is responsible. Occupationalintegration assistance for job seekers who are able to work and in need of assistance is providedby the benefit agencies serving job seekers under Book II of the Social Code.Social assistance and youth welfare agencies come into play in all areas of rehabilitation andintegration, though only when no other body is responsible. In such cases, the local socialservices office and youth welfare office are the main points of contact.
It is not always easy to know who is responsible for what. So that this does not place disabled people at adisadvantage, the various agencies responsible for rehabilitation are required to work closely with eachother. The agencies have also set up joint service centres in almost all urban and other districts. The jointservice centres cover all agencies and provide information on responsibilities and on criteria for receivingbenefits and services and administrative procedures, and help with completing applications. Theestablishment of joint service centres supports coordinated provision close to home and one-stop supportfor people with disabilities or at risk of disability. The agencies are also required to clarify responsibilitieswithin 14 days and to ensure that decisions are made quickly and unbureaucratically.
War pensions offices and integration officesGermany’s war pensions offices, employment services and integration offices are among the agenciesthat carry out the tasks arising from Book IX of the Social Code. War pensions offices are responsible fordetermining a person’s disability, the degree of disability and any further health conditions that are a
- 69 -requirement for claiming handicap benefits. These offices also issue the severely disabled person’s pass.The Federal Employment Agency provides incentives for hiring severely disabled persons and monitorcompliance with the statutory obligation to employ severely disabled people. Special protection againstdismissal, supportive assistance in employment and collection of compensation contributions all comeunder the purview of integration offices.
The lawThe main legislation on this topic can be found in the following:The Social CodeFederal War Victims Relief Act (Bundesversorgungsgesetz)
Information
The Federal Ministry ofHealth and Social Securityservice for the deaf andhard of hearing can becontacted on 01805 9966-04, Mondays to Thursdays,8 am to 8 pm. Calls from theGerman telephone networkcost€0.12per minute.
A key feature of Book IX of the Social Code is the obligation on rehabilitation funding bodies to establishjoint service centres. The local joint service centres offer comprehensive help and advice independent ofany specific fund or provider. Their services include:Providing information about the assistance available and the conditions that must be satisfied toreceive itSupporting those affected in the identification of rehabilitation needsIdentifying which rehabilitation fund is responsibleHelp with making applicationsAccepting applications and forwarding them to the appropriate fundSupport in claiming assistancePreparing each application to the point that a decision can be madeOngoing support until a decision is made, and coordinating and mediating between the variousfunds and parties involvedImportant: Any authority involved with funding rehabilitation must accept your rehabilitation application – aspecific form is not required – and if necessary forward it to the responsible authority. The latter must thengive you a decision. Only in very exceptional cases can an application be forwarded a second time, andthen only if it is assured that the authority to which it is forwarded will give a decision.
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The ‘Jobs Without Barriers’ initiativeJobs ohne Barrieren
Aims and objectives‘Jobs Without Barriers’ (Jobs ohne Barrieren) is an initiative launched by the FederalMinistry of Labour and Social Affairs in cooperation with employers, unions, disabilityassociations and organisations, the Federal Employment Agency, agencies responsiblefor funding rehabilitation, the Council for the Integration of People with Disabilities andother organisations. In operation since mid-2004, the initiative aims to enable disabledand severely disabled people to be integrated into the jobs market and take betteradvantage of opportunities to participate in working life. Although occupationalintegration of disabled and severely disabled people in Germany has improved in recentyears, their situation on the mainstream labour market remains unsatisfactory.The German government and parliament have created a legal framework in recent years to secureseverely disabled men and women equal opportunities in working life while taking into consideration thechanging situation on the labour market.Targeting the training and employment of disabled people along with workplace prevention measures, theFederal Ministry of Labour and Social Affairs coordinated the Jobs Without Barriers initiative to help bringabout real improvements in the situation of disabled and severely disabled people as regards participationin working life.The Jobs Without Barriers initiative disseminated information about the legal framework for promoting thetraining and employment of disabled and severely disabled people and for promoting workplaceprevention, and presented best practice examples to help achieve three objectives in public and private-sector workplaces:Promoting the training of disabled and severely disabled young peopleFurther informationImproving the employment chances of people with severe disabilities,on the initiativeAdditional information on theespecially in small and medium-sized enterprisesinitiative is available (inFurthering workplace prevention through the introduction of company-German) at www.jobs-ohne-level integration management policiesbarrieren.de. The wide rangeAccomplishments under the initiative up to and including 2006:41 projects were given funding grants, some from the nationalrehabilitation fund and some from the European Social Fund.42 activities were not granted funding but were presented under theinitiative as best practice examples.130,000 orders were received for the brochure on the initiative and20,000 for the DVD on the initiative.Almost 3,500 people have taken part in thirteen events held around thecountry to date.of information providedincludes brief descriptions ofactivities and projects comingunder the initiative and howto get involved. Questionscan also be directed in writingto the Federal Ministry ofLabour and Social Affairs,‘job-Projekt’, GruppeRehabilitation,Rochusstrasse 1, 53123Bonn, Germany.
As part of a follow-up initiative, four projects have been started and 15 best-practice activities presented. Another four events were held and the brochure on the ‘Jobs WithoutBarriers’ initiative has been revised and reprinted several times. A new brochure on integrated vocationaltraining (Verzahnte Ausbildung – Ein Überblick für Unternehmen und Berufsbildungswerke) was alsobeen published and is now in its second, heavily revised edition.Started in 2004, the initiative ended on 31 December 2006. An evaluation was published on 30 June2007 as part of the government’s report on the effects of employment and prevention under Section 160(2) of the Ninth Book of the Social Code (SGB IX).Building on experience gained through ‘Jobs Without Barriers’, a follow-up initiative, ‘job’ (2007 to 2010)commenced in autumn 2007. This takes account of the high demand for information, particularly fromemployers, about the legal framework for training and employing people with disabilities, and the need for
- 71 -model integration projects that can be replicated elsewhere to assist disabled and severely disabledpeople enter the mainstream labour market.The following projects are funded as part of the initiative:From September 2008: “Integratives Beratungsnetzwerk BetrieblichesEingliederungsmanagement” (Integrated advice network on workplace integration management;project funding agency: Deutsche Rentenversicherung Bund)From October 2008: “Motiviert integriert II – Beschäftigung schwerbehinderte Menschen sichernund Fördermittel nutzen” (Motivate and Integrate II: Securing the employment of severelydisabled people and making use of available sources of funding; project funding agency:Sozialverband VdK)From October 2008: “Entwicklung eines betrieblichen Ausbildungsgangs für schwerbehinderteJugendliche zum/zur Fachpraktiker/in in sozialen Einrichtungen” (Development of a workplacetraining course for severely disabled young people, leading to a vocational qualification formanual work in social establishments; project funding agency: Gesellschaft zur Förderungnachhaltiger Lebensqualität e.V.)From November 2008: “Automobil: Ausbildung ohne Barrieren” (‘Automobile’: Barrier-freevocational training; project funding agency: University of Cologne and cooperation partners)From May 2009: “Medizinische Tastuntersucherin” (Mammary palpation by blind examiners;project funding agency: Berufsförderungswerk Düren and cooperation partners)From June 2009: “Werkzeugkasten Eingliederungsmanagement” (Integration managementtoolbox; project funding agency: BIT Berufsforschungs- und Beratungsinstitut für interdisziplinäreTechnikgestaltung e.V. and cooperation partners)From April 2010: “Evaluation der Einführung des Ausbildungsgangs ‘Fachpraktiker/in in sozialenEinrichtungen’” (Evaluation of the introduction of a vocational qualification for manual work insocial establishments; project funding agency: Emden University of the Applied Sciences)The ‘job’ initiative covers 17 activities, including five large companies: Bertelsmann AG, Daimler AG,E.ON AG and Siemens AG. One activity, “Verzahnte Ausbildung mit Berufsbildungswerken” (Integratedvocational training with vocational training centres) also features significant involvement by the METROGroup.Nine events have been staged on focus topics with some 300 participants in each event, notablypersonnel managers from industry.A publication, “job – Leistungen an Arbeitgeber, die behinderte oder schwerbehinderte Menschenausbilden oder beschäftigen” (on assistance for employers who train or employ disabled or severelydisabled people) has been reissued several times. The publication is the only one of its kind to present afull description of the assistance available to employers who train or employ disabled people. Alsoavailable is a DVD of the initiative (“Barrierefreiheit”). Among other things, the DVD presents the modelproject on mammary palpation by blind examiners.The projects carried out under the initiative will be evaluated in the first half of 2011 and the findingspublicised at a closing event and online.
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Job4000The Job4000 programme was launched on 1 January 2007, partly based on experienceso far with projects and activities under the Jobs Without Barriers initiative. Theprogramme aims to promote the occupational integration of severely disabled people inthe mainstream labour market. It also supports the Federal Employment Agency incarrying out their statutory responsibilities concerning the occupational integration ofpeople with disabilities.
Grant fundingA total of€30million is provided by the Federal Ministry of Labour and Social Affairs from the nationalrehabilitation fund. The sixteen German Länder provide an additional€20million.
Focus areasEmploymentEmployers receive financial assistance from the integration office if they additionally take on a severelydisabled person with special difficulties. The amount and duration of the assistance is determinedindividually. There is scope for an average of€600a month for up to five years. The target group includesseriously disabled people who have not completed vocational training or who have a mental orpsychological handicap. At least 1,000 new jobs are to be created for this group.
TrainingThe integration office pays employers a premium of up to€3,000a year if they provide a severelydisabled young person with an additional vocational training place. A further premium of up to€5,000isavailable on completion of the training if the person is given employment subject to social insurancecontributions. The aim is to create at least 500 new vocational training places for severely disabled youngpeople.
SupportIntegration services are available to support the training and employment of severely disabled people.These primarily target severely disabled school leavers. The integration services receive up to€250amonth for each support case. The programme aims to fund at least 2,500 support cases.
ResponsibilityThe Job4000 programme is carried out independently by the German Länder. Integration offices serve aspoints of contact for employers.
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Health insurance and the electronic health cardKrankenversicherung und elektronische GesundheitskarteStatutory health insurance (Krankenversicherung) safeguards you and your family incase of illnes. It pays for necessary medical treatment. The only exceptions are benefitsyou claim after an occupational accident or because of an occupational illness. In thesecases you are covered by statutory accident insurance. It pays sickness benefit if youremployer does not continue to pay your wage or salary while you are unable to work.Until the end of 1995, which health insurance scheme you were in depended on yourprofession or who you worked for. As of 1 January 1996, anyone in a local, company,guild or other statutory health insurance fund is free to choose which fund they wish tobe insured with (company and guild funds can only be chosen if they have changedtheir statutes to accept outsiders). The Miners Social Security Fund (Knappschaft) canbe chosen from 1 April 2007. Special conditions apply for entry into health insurancefunds for the farming, forestry and gardening sectors.
What statutory health insurance coversAs an insured person you can claim:Measures for the prevention and early detection of certain diseases (children in the first six yearsof their life and at the beginning of puberty; adults every two years from the age of 35). Womenfrom the age of 20 and men from the age of 35 are entitled to annual cancer screening)Preventive dentistry and in particular individual and group prophylactic measures to preventdental diseasePreventive inoculations recommended by the German Standing Vaccination Committee (STIKO)at the Robert Koch Institute and prescribed by the Federal Joint Committee on the basis of thatrecommendationOrthodontic treatment, as a rule up to age 18Medical and dental treatment, with free choice among panel doctors and dentists, medical carecentre (MVZ), non-panel doctors or dentists authorised to treat members of statutory healthinsurance schemes (ermächtigter Arzt/Zahnarzt), and dental clinics and other health carefacilities (Eigeneinrichtung) operated by statutory health insurance schemesMedicines, dressings, therapies, and aids such as hearing aids and wheelchairsMedically necessary provision of dentures and crownsHospital treatmentSome or all the cost of necessary preventive and rehabilitation treatmentSickness benefit (Krankengeld): Normally, your employer will continue to pay your wage or salaryfor six weeks when you are unable to work. After that your health insurance will pay 70% of yourregular wage or salary before deductions up to the contribution assessment limit, though notmore than 90% of your most recent take-home pay. You can claim sickness benefit for amaximum of 78 weeks in a given three-year period. If you are a farmer, you will receive anupkeep allowance instead of sickness benefit, though agricultural health insurance funds also paysickness benefit to seasonal workers who are insured with them.Sickness benefit for up to ten days a year for each insured child under 12 who you have to carefor, subject to presentation of a doctor’s note and provided that no other person living in yourhousehold is able to supervise, care for or look after the child. If you are a single parent, yourentitlement doubles to a maximum of 20 days. If you have several children, your entitlement islimited to a total of 25 working days, or as a single parent 50 working days per calendar year. Theentitlement extends beyond the age of 12 for sick children who are disabled and in need of help.Home help if you have to go into hospital or undergo in-patient or rehabilitation treatment ortreatment in the home, you are unable to look after your home as a result, and have a child livingin your household which has not reached the age of 12 when home help begins or which isdisabled and in need of helpHome nursing care if this helps avoid or shorten a stay in hospital or aids your medical treatmentHome nursing care or home help for women when needed because of pregnancy or childbirth
- 74 -Social therapy for insured persons who have a severe mental affliction that prevents them fromaccepting or taking medical treatmentMaternity benefit (Mutterschaftsgeld) and maternity allowance (Mutterschaftshilfe) duringpregnancy and after childbirth. As a member of a health insurance fund you usually receive childbenefit for six weeks before and six weeks after the birth (the statutory period of maternity leave),extended to twelve weeks after the birth in the case of multiple or premature births. The amountdepends on your average wage over the last three months, or the last 13 weeks before thebenefit period. Your health insurance pays a maximum of€13a day. Your employer pays thedifference between this and your average take-home pay for the duration of the benefit period.
Who is insuredAs an employee you are compulsorily insured if your regular income before deductions does not exceed€450per month and remains below a set annual limit (Jahresarbeitsentgeltgrenze). The annual incomelimit up to which employed people are automatically and compulsorily insured officially ceased to belinked to pension insurance on 1 January 2003 and now consists of a general annual income limit or aspecial reduced annual income limit. The general annual income limit for 2013 is€52,200and thusremains at 75% of the pension insurance contribution assessment limit for blue and white-collar workersin western Germany. For reasons of fairness, a reduced annual income limit of€47,250in 2013 appliesfor workers who were exempt from compulsory health insurance because they exceeded the contributionassessment limit on 31 December 2002 and switched to an alternative private health insurance fund. Thisamount is identical to the annual income limit applied in the state health insurance scheme.The rule on when you cease to be subject to compulsory insurance on account of exceeding the annualincome limit has changed under new legislation on the financing of the statutory health insurance system.With effect from 31 December 2010, the rule has reverted to the annual income limit only having to beexceeded for a single year in order for compulsory membership of the statutory health insurance schemeto cease.The following are also compulsory members of the state health insurance schemes:Students at state and state-approved universitiesPeople on work experience or in second-chance educationOld-age pensioners who have been in a statutory health insurance scheme or insured as a familymember for most of the latter half of their working lifeDisabled people employed at an approved workshop or on employment promotion schemesUnemployed people receiving benefits from the Federal Employment Agency (Arbeitslosengeld,or under certain conditions Arbeitslosengeld II)FarmersMembers of farming families who are primarily employed on the farm and are at least 15 yearsold or are in trainingRetired farmers who have claimed Altenteil (the right to continue living on the farm after making itover to their children)Artists and members of the publishing professions as provided in the Artists Social Insurance Act(Künstlersozialversicherungsgesetz)You can within a period of three months join a state health insurance scheme voluntarily if you:Have been a compulsory member, your membership is terminated and you have certainqualifying insurance periodsAre severely disabled (subject to certain other requirements)Have been insured through a family member for a specific minimum period and this insurancehas expiredIndividuals who are voluntarily insured in the statutory health insurance system, for example employeeswhose pay exceeds the annual ceiling (Jahresarbeitsentgeltgrenze), civil servants and self-employedpersons, may opt for private health cover with a private health insurer. In doing so, they should givecareful consideration to which of the two systems is the best given their personal circumstances, and takeinto account that once they have switched to a private health insurer, a return to the statutory healthinsurance system is only possible in very exceptional circumstances.
- 75 -No patients’ contributions are payable for early detection screening, inoculations, other preventivemeasures or dental prophylaxis. Health insurance funds can also grant members partial or full exemptionfrom paying patients’ contributions, for example for certain types of treatment.According to German health insurance law, anyone living in Germany receives health insurance cover ineither the statutory or private health insurance system but has no entitlement to other types of insurancecover.From 1 April 2007, anyone lacking other provision for the event of illness and who has previously been inthe statutory health insurance system is made a compulsory member (Section 5 (1) 13 of Book V of theSocial Code/SGB V). You become a compulsory member of your previous statutory health insurance fundor its legal successor, beginning on the day you cease to have other provision for the event of illnesswithin Germany or on 1 April 2007, whichever is the later. The same applies for anyone who has neverhad statutory or private health cover and comes under the statutory health insurance system. Pleaseseek advice on this from a statutory health insurance fund.In accordance with Section 193, paragraph 3 sentence 1 of the German Insurance Contract Act(Versicherungsvertragsgesetz, or VVG), as of 1 January 2009 anyone living in Germany who is neitherinsured under the statutory system or by other means must have private health insurance which covers atminimum out-patient and in-patient medical treatment. The annual deductible is limited to a maximum€5,000.Full-time self-employed persons are not subject to compulsory statutory health insurance and must thushave private health insurance cover unless they were insured under the statutory system before enteringself-employment.Since 1 January 2009, anyone exempt from the requirement to have insurance cover, especially civilservants, pensioners and others who may claim state contributions towards the cost of health care(Beihilfe) and who have no supplementary insurance to cover healthcare costs, are not covered by thestatutory health insurance system even if they were covered by that system previously. Since 1 January2009, these individuals are required to have private health insurance to cover healthcare costs notcovered by the amount covered by Beihilfe received. This requirement for private insurance also appliesfor employees who are exempt from the requirement to have insurance cover, i.e. blue-collar and white-collar workers whose regular annual pay exceeds the compulsory insurance ceiling.The requirement for insurance cover can be met with a basic premium insurance contract. Private healthinsurance carriers have been required to offer this type of contract alongside existing policy options.The following applies with regard to provision for recipients of social assistance in case of illness:For anyone in receipt of regular assistance provided under Chapter 3, 4, 6 or 7 of Book XII of the SocialCode (SGB XII) since 1 April 2007 or before, the social assistance agency that provides that assistancewill also provide assistance in the event of illness. Under section 264 of SGB V, the medical treatment isgenerally paid for by a statutory health insurance fund and then refunded by the social assistanceagency. The continued responsibility of social assistance agencies for such recipients of social assistancein the event of illness after 1 April 2007 is expressly laid down in section 5 (8a) of SGB V. It is unaffectedby a interruption in entitlement to the regular social assistance of less than one month, irrespective ofwhether the social assistance agency deregisters a person from the procedure under section 264 of SGBV – the sole requirement is that the person was in receipt of regular assistance provided under Chapter 3,4, 6 or 7 of SGB XII and remained in receipt of that assistance without an interruption in excess of onemonth.Anyone in receipt of regular assistance provided under Chapter 3, 4, 6 or 7 of Book XII of the Social Codesince 1 April 2007 and subject to insurance on a subordinate basis on that date (section 5 (1) 13 of SGBV) remain members of the statutory health insurance scheme.Anyone solely in receipt of assistance in the event of illness provided under Chapter 5 of SGB XII willbecome subject to compulsory statutory health insurance if they come within the scope of statutory healthinsurance and, with effect from 1 April 2007 or since, satisfy the requirements for being subject tocompulsory insurance on a subordinate basis in the absence of any other entitlement to provision in theevent of illness (section 5 (1) 13 of SGB V). Being subject to compulsory insurance on a subordinate
- 76 -basis, such individuals also remain members of the statutory health insurance scheme if they laterreceive regular assistance towards living expenses (assistance under Chapter 3, 4, 6 or 7 of SGB VII).Voluntary members who wish to switch to a private insurer should consider the fact that a later return tothe state health insurance scheme is only possible in very exceptional circumstances and should seekadvice from their state health insurance fund.
Family insuranceState health insurance also covers your family at no extra charge. Your spouse or civil partner and, up toa certain age, your children are covered by your insurance, provided among other things that theircollective income does not exceed€385a month and they do not have their own insurance (figures for2013). If you are in marginal employment, the allowable collective income is€450.All members of state health insurance schemes should report changes in their working, financial andpersonal circumstances to their health insurance fund. Those receiving unemployment benefit(Arbeitslosengeld and Arbeitslosengeld II) must also report the changes to the local employment agencyto prevent any inadvertent loss of insurance cover.
Patients’ contributionsHealth insurance has to be paid for in one way or another. This is why we cannot expect it to help withevery minor complaint; otherwise, it would soon become unaffordable.Patients’ contributions in statutory health insuranceBenefitsDrugsDressingsTravel expensesTherapiesAidsConsumable aidsHospital treatmentOutpatient rehabilitation treatmentInpatient preventive treatment and rehabilitation treatmentPost-hospital rehabilitation treatmentPreventive and rehabilitation treatment for mothers and fathers* Not exceeding the actual costPatients’ contributions from 1 January 200410% of the pharmacy counter priceminimum€5and maximum€10As above*10% of the travel expensesminimum€5and maximum€10per journey*10% of the counter priceplus€10per prescription*10% of costminimum€5and maximum€10*10% of costmaximum€10per month€10per day for a maximum of 28 days within a calendar year€10per day€10per day€10per day for a maximum of 28 days within a calendar year,minus contributions paid towards hospital treatment€10per day
The insured share the responsibility for their own health. For this reason they are required to contributetowards the cost of certain items. This is laid down in the law on health insurance, which encouragespeople to be cost-conscious and responsible in its use.These contributions are necessary – but they must not be allowed to overstretch your budget. The lawtakes account of this, so that in certain circumstances you pay less or nothing at all.
Exemption from patients’ contributionsChildren and young people under the age of 18 are exempt from patients’ contributions except in the caseof dentures and travel expenses.
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Contribution limitThe limit for patients’ contributions is 2% of assessed gross disposable income (1% for people withchronic illnesses). The assessed income figure is arrived at by deducting an exempt amount for eachfamily member from family gross income and so depends on how many people are in the samehousehold and live off the income total. Larger amounts are deducted for children than for adults. Thededuction of exempt amounts from family gross income means that the contribution limit varies accordingto the size of the household. The exempt amount for the first dependant living in the same household is15% of an annual reference figure and comes to€4,851in 2013. The exempt amount for eachsubsequent dependant is 10% of the same reference figure, or€3,234in 2013. The amount for each childis€7,008.The older 10% rule for other dependants now applies in health insurance for farmers only.Family gross income means family disposable income before deductions: the sum of all income thataccrues to the insured and any live-in dependants and is available for meeting living expenses. Thisincludes rental income and capital gains – types of income on which compulsory members of a healthinsurance scheme do not pay any contributions.Health insurance law is founded on the gross income principle. That is, a person’s ability to pay into thesystem is generally measured by looking at their income before deductions. A person’s health insurancecontributions likewise depend on their income before deductions. Accordingly, the same measure, ratherthan net income, is used to set the limit for patients’ contributions.The insured and the insured’s spouse or civil partner and any children for whom the insured can claimmust keep a record of all patients’ contributions paid over each year. If the contribution limit is reached ina given year, the health insurance fund must issue the insured with an exemption note for the remainderof the year.The contribution limit applies for all patients’ contributions, including those paid for hospital treatment, in-patient preventive care and rehabilitation.
Concessions for chronically ill patientsSpecial rules apply for chronically ill patients in acknowledgement of their special situation.Patients in ongoing treatment for the same illness have a lower contribution limit of 1% of annual incomebefore deductions. The Federal Joint Committee of medical practitioners and health insurance funds isrequired by law to issue directives defining what constitutes a chronic illness. According to prevailingregulations on chronic illness, an illness is deemed a serious chronic illness if it is medically treated atleast once a quarter for at least a year and at least one of three criteria is met:The patient requires Level II or III care.The patient has at least a 60% disability under severe disability law/pensions law or at least a60% incapacity to work under accident insurance law.Continuous medical care is required (medical or psychotherapeutic treatment, drug treatment,technical nursing, and provision with therapies and aids) without which, on a professional medicalappraisal, a life-threatening worsening of the illness, a reduction in life expectancy or a lastingimpairment of quality of life is to be expected as a result of the illness.
The task of deciding if a patient has a serious chronic illness as defined in the directive falls to the healthinsurance fund. The exemption from patient contributions applies for all family members living in the samehousehold.
Concessions for social assistance recipients and othergroupsRecipients of welfare benefits under the Twelfth Book of the Social Code(SGB XII: Social Assistance) or war victims welfare benefits are morefavourably placed than other insured persons. For these individuals, theirhousehold assessable gross disposable income for the purpose ofestablishing their contribution limit is equated with only the standard
The lawState health insurance is the oldestpart of the social insurance system.The relevant law is set out invarious acts. For example:Book V of the Social CodeThe Second Farmers HealthInsurance Act
- 78 -benefit rate for the head of a household as specified in the Regelsatzverordnung – the ministerial order inwhich the standard benefit rates are laid down (Book V of the Social Code (SGB V), Section 62(2)).Such benefit recipients must pay the patients’ contributions matching the standard benefit ratethemselves. The standard benefit rate is€4,368a year. The corresponding patients’ contributions to bepaid for the household by social assistance recipients each year are as follows:1% contribution limit (chronic illness):€45,842% contribution limit (without chronic illness):€91,68This concession also applies for people whose costs of accommodation in a home or similarestablishment are met by a social assistance agency or war victims support fund, and for the groupsnamed in SGB V, Section 264 (social assistance recipients for whom healthcare is provided by thestatutory health insurance scheme and recipients of regular benefit payments under Section 2 of theAsylum Seekers Benefits Act (Asylbewerberleistungsgesetz)). That is, gross disposable income for theentire household is equated with only the standard benefit rate for the head of a household as specified inthe Regelsatzverordnung.For social assistance recipients living in homes, a standard statutory procedure has been put in place (inan amendment to the law integrating social assistance law into the Social Code) for helping in cases of –temporary – hardship. Under the new provisions, the social assistance agency grants the affectedindividuals a loan in the amount of the applicable contribution limit and pays it out directly to theresponsible health insurance fund.The latter issues the affected pocket-money recipients a note exempting them from patients’contributions.The pocket-money recipients repay the loan to the social assistance agency in fixed amounts over theentire calendar year.
Special hardship clause for denturesFor dentures, there is a sliding scale in case of hardship based on patients’ monthly gross income beforedeductions. Please contact your health insurance fund to ask whether you are entitled to partial orcomplete exemption from the requirement to contribute to the cost of your dentures.
InformationFor further information, please contact your health insurance fund. They will alsogive you a receipt book for payments you make towards the cost of treatment.
FundingA uniform general and a uniform reduced contribution rate apply in the statutoryhealth insurance scheme since January 2009.
These contribution rates were laid down by the German government insecondary legislation on the basis of an appraisal panel at theBundesversicherungsamt (Federal Insurance Office). Since 1 January 2011 they are laid down by law.
The German FederalMinistry of Health andSocial Security runs acitizens’ information line onhealth insurance. Tel.01805 9966-02, Mondaysto Thursdays, 8 am to 6pm. For questions aboutinsurance cover call 018059966-01. Calls from theGerman telephone networkcost€0.14per minute.Rates for calls from mobilephones may differ.
The general contribution rate, which applies for contributions from earnings, pensions, etc., is 15.5percent. It is made up of a contribution rate of 14.6 percent that is financed half each by employer andemployee or pension insurance fund and pensioner, and a supplementary contribution of 0.9 percentagepoints that is paid entirely by health insurance scheme members.The reduced contribution rate, which normally applies for members without entitlement to sicknessbenefit, is 14.9 percent. This rate likewise includes a 0.9 percentage point contribution that is paid entirelyby members.Contributory income is calculated and flows together with tax revenue into the new statutory healthcarefund.
- 79 -To cover their expenditure, the statutory health insurance funds receive lump-sum allocations from thestatutory healthcare fund. These allocations are paid per patient together with additional age, risk andgender-adjusted supplements. This approach takes account of differing patient profiles and incidences ofillness in the insured population.If a health insurance fund receives allocations that exceed its own funding requirements, it may pay outbonuses to its patients as long as it keeps adequate funding reserves. If a health insurance fund is unableto meet its expenses from the allocations it receives, it must tap into efficiency reserves; if these are notsufficient, the fund requires members to pay additional contributions that are not income-linked. At thesame time, a social equalisation mechanism across all health insurance funds ensures socially equitablefunding. The social equalisation mechanism ensures that statutory health insurance members do not facean unreasonable burden. If the average additional contribution charged by health insurance fundsexceeds two percent of earnings subject to contributions, the social equalisation mechanism is applied byemployers and pension funds. The average additional contribution charged by health insurance funds in2011 was zero. The social equalisation mechanism was consequently not triggered in 2011. The sameapplies for 2012 and 2013.Statutory health insurance members also have the option, within the framework of the statutory rules ontermination, of switching to another health fund to avoid additional contributions. If they do not do this,they must pay the additional contributions themselves.In the case of compulsorily insured employees, the employer also pays half of the portion of thecontribution that is equally divided between employer and employee.Employees who are voluntary members of a statutory health insurance fund pay their health insurancecontributions themselves. In certain circumstances, however, they may receive a subsidy from theiremployer. For example, voluntarily insured employees who are only exempt from being statutorily insuredbecause their annual income exceeds the income limit receive a subsidy equal to the amount that theemployer would have to pay for a compulsorily insured employee.Old-age pensioners who are voluntarily insured in the statutory health insurance scheme receive acontribution supplement to assist with health insurance costs from their respective pension insurancefund.When calculating contributions, the contribution assessment limit (Beitragsbemessungsgrenze) must betaken into account (€3,825 in 2012). This is the maximum amount used to determine an insured person’scontribution, even if their actual income is higher.From 1 January 2013, there is an additional concession for employees with a monthly income between€450,01and€850.Special rules now apply under social security law for employees who fall within thisincome band. If your income is within the band, the new rules provide for part of it to be exempt fromsocial insurance contributions. Employers are still required to pay their normal contribution on the amountyou earn.
Information on the electronic health card(as of 10 January 2012)Germany’s statutory health insurance funds started issuing members with new electronic health cards inOctober 2011. The aim is for everyone insured under the statutory system to be in possession of anelectronic health card by the end of 2013. The organizations responsible for introducing the new cardmust do so by a certain cut-off date after which only electronic health cards will be accepted as proof ofinsurance cover.The electronic health card serves to improve patient healthcare. The quality of medical treatmentdepends on whether the physician has all necessary medical history information. The electronic healthcard and the associated telematics infrastructure being established by the healthcare sector providestreating physicians with secure and speedy access to patient data. Issuing the cards, which are the key topractical and secure exchange of medical data, is just the first step. The ultimate aim is to improve thequality of medical treatment, empower patients and cut healthcare costs.
- 80 -The new cards mean no change for patients when they visit their doctor. The electronic health card isscanned in the same way as the old insurance card. To ensure a smooth transition to the new system,doctors, dentists and hospitals have been equipped with modern card readers which were financed by thehealth insurance funds. The card-reading terminals can be used to scan both health insurance cards andthe new electronic health card.In contrast to the old health insurance card, the electronic health card features a photograph of thebearer. Exceptions exist for patients under 15 and for those who were unable to provide a photographbecause they are in full-time care or are immobile.The photograph prevents potential mix-ups regarding data and also reduces misuse and false claims formedical treatment. The health insurance funds write to their members, asking them to provide aphotograph. In many cases, patients can upload their photograph online. Some funds also offer theirmembers the opportunity to have their photograph taken at the health insurance office.The vast number of participants and the various requirements regarding the electronic health card andthe telematics infrastructure make its introduction highly complex, which is why its features and functionswill be implemented in a phased approach. At present administrative data is stored on the card, such asthe patient’s name, date of birth and address, and information regarding the health insurance fund, healthinsurance number and insurance status (member, family member or pensioner). A new feature involvesdata regarding a patient’s gender. This and the card bearer’s photograph are designed to prevent mix-ups. The back of the electronic health card can be used as the ‘European Health Insurance Card’, thusallowing unbureaucratic provision of medical treatment within the European Union.In subsequent phases, the system will provide for online comparison of the insurance data contained onthe health card with that held by the respective health insurance fund along with the storage of data foruse in emergencies. The system also has the potential to allow storage of data regarding medication andinoculations, and to act as an online patient file. One prerequisite for country-wide implementation is thatthe system stands up to tests in practice and that the strict security provisions are observed.Patients decide for themselves whether and to what extent they wish to make use of the healthcareoptions provided by the electronic health card. Use of features such as the storage of data for use inemergencies is voluntary. Patients also have the right to view the data, receive a print-out of it or ask for itto be deleted. As with the existing insurance card, patients’ administrative data are the only informationwhich must be stored on the card by law.Data privacy and practicability are the foremost priorities and are provided for both by law and via thetelematics infrastructure. This means, for example, that medical data stored using the electronic healthcard can only be accessed with the approval of the patient and the treating physician. Such approval isgiven by the patient sliding their electronic health card and the physician sliding their physician’s ID cardinto the card reader (dual control principle). The patient must then enter a PIN number to allow access totheir medical data. Exceptions occur in cases of emergency, with access being possible without thepatient’s PIN number. The physician’s ID card is required in all cases.
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Long-term care insurancePflegeversicherung
Providing help where it is needed mostWe cannot lay out the course our own lives will take. Many things happen that wesimply can’t influence. Things generally go smoothly, and most people who need long-term care today didn’t have many problems until the day when they started needing it.Many people who require care today, and their families, were at one point suddenlyfaced – often from one day to the next – with the enormous burdens involved inproviding long-term care. Carers’ lives often revolve around care-giving, sometimespushing them to their limits. Long-term care can also exhaust your financial resources.Very few people were insured for such an eventuality before the introduction of long-term care insurance (Pflegeversicherung).A few numbers to illustrate the magnitude of the problems related to long-term care:Today, some 2.42 million people in Germany require long-term care. This figure islarger than the population of Hamburg. About 0.75 million of these people live in nursinghomes. The remaining 1.67 million are cared for at home by a host of relatives,neighbours, volunteers or professional carers who are often self-sacrificing and deservegreat praise for their efforts to care for people who cannot take care of themselves.
What you have to doThe general rule is that you must have long-term care insurance to match your health insurance. If youhave statutory health insurance for whatever reason – on a compulsory or voluntary basis, as adependant of an insured person, or as a pensioner – then you automatically have statutory long-term careinsurance as well.If you take out statutory health insurance on a voluntary basis, you can apply to be exempted fromstatutory long-term care insurance. You must then prove that you have equivalent cover from a privateinsurance company and you must submit your application to the appropriate long-term care insurancefund within three months after your private insurance cover begins.Since 1 January 1995, anyone who has private health insurance has been required to have private long-term care insurance as well. If you are currently privately insured but become liable for statutory long-termcare insurance at some later date, you will be allowed to terminate your private insurance with effect fromthe date your liability begins.Benefits provided under private long-term care insurance must be equivalent to those provided bystatutory long-term care insurance. Private insurance companies are also required to offer reasonableterms and rates for families and older members.Unless they are already covered by statutory health insurance, tenured civil servants (Beamte) must alsocarry private long-term care insurance. However, they need only take out top-up cover to supplement thepublic service’s health-care cost reimbursement system.In addition, other groups of individuals who receive health insurance in accordance with certain laws orspecial systems must have long-term care insurance with either a statutory health insurance fund or witha private health insurance carrier as appropriate in the individual’s particular circumstances.Dependent children, spouses and non-married partners are insured free of charge as family membersunder the family insurance provisions of the statutory health insurance system providing their regularmonthly income does not exceed€385or€450for anyone in marginal employment.
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Benefits and conditionsIf you are insured and pay your contributions, you are legally entitled to assistance should you ever needlong-term care. Your financial situation has no effect upon your entitlement.
Who is eligible for long-term care?According to the law, you are eligible for long-term care if, because of a physical, mental or psychologicalillness or disability, you require frequent or substantial help with normal day-to-day activities on a long-term basis (that is, for an estimated six months or longer).The normal, routine day-to-day activities that are covered:1. Personal hygiene: washing, showering, bathing, dental hygiene, combing your hair, shaving, going tothe bathroom2. Eating: eating, and preparing food so that it is bite-sized and ready to eat3. Mobility: getting out of and going to bed, dressing and undressing, walking, standing, climbing stairs,leaving and getting back to your home4. Housekeeping: shopping, cooking, cleaning, dishwashing, changing and washing linen and clothing,heating your homeAssistance may consist of someone helping you to carry out routine activities of daily life, helping you toperform these tasks at least partly on your own, or supervising and guiding you when doing them.Assistance is aimed at helping you regain your ability to do these tasks by yourself.The different care levelsDepending on the type of care needed, three levels of care apply (I, II or III). A Care Level O also exists.The care level determines the amount of care provided. If you require extreme care and are classedunder Care Level III, you may qualify as a hardship case.Care Level ONo matter how old you are, if you have a dementia-related incapacity, a mental disability or a physicaldisability, your everyday activities could be severely restricted even if your basic care and home-helpneeds do not qualify for Care Level I.Care Level I: Considerable need of careConsiderable need of care arises when you need help at least once a day with a minimum of twoactivities from one or more types of activity (personal hygiene, eating or getting around). You also needhelp several times a week with household chores. You require an average of at least 90 minutes of helpevery day of the week for basic care and household chores. Your carer must spend more than 45 minutesof this time providing basic care.Care Level II: Severe need of careSevere need of care arises when you need help at least three times a day with basic care (personalhygiene, eating or getting around). In addition, you need help several times a week with householdchores. You require an average of at least three hours of help every day of the week for basic care andwith household chores. Your carer must spend at least two hours of this time providing basic care.Care Level III: Extreme need of careExtreme need of care arises when you need round-the-clock help every day. You also need help severaltimes a week with household chores. You require an average of at least five hours of help every day ofthe week for basic care (personal hygiene, eating and getting around) and household chores. Your carermust spend at least four fours of this time providing basic care.
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Hardship casesIf you meet the requirements for Care Level III and require an extraordinary level of care, you may qualifyas a hardship case and thus for additional care. A hardship case exists when:You need at least six hours of help every day, a minimum of three of which must be during thenight. If you reside in a full-time care home, the time spent providing medical care will be takeninto account.You receive basic care during the night from several carers at once. At least one activity duringthe day and one during the night requires both a professional healthcare and an additional carerwho must not necessarily be employed by a care agency (a family member, for example). Thisprovision is designed to prevent several carers from a care agency attending you at the sametime.
Each of the two required activities meets the standards for qualitative and quantitative care that exceedsthe usual level of care provided at Care Level III. An additional requirement is that you need constant helpto complete household chores.
How to claimClaims for assistance under long-term care provisions must be submitted to your long-term careinsurance fund, which is an arm of your health insurance fund. Claims may also be made on your behalfby family members, neighbours or close friends if you authorise them to do so. Once the claim is receivedby the long-term care insurance fund, the fund then asks the medical service of the German healthinsurance funds (Medizinische Dienst der Krankenversicherung, or MDK) to assess your care needs.
The approval processThe legally prescribed processing period for long-term care claims is five weeks. If you are in hospital orin a rehabilitation clinic, in a hospice or receiving out-patient palliative care, the MDK assessment musttake place within one week if the assessment will be used to determine the level of care you need fromthen on or if the claim involves a notification to an employer regarding a period of home nursing care. Ifyou are at home and not receiving palliative care and a period of home nursing care as been notified toan employer or a period of family care has been agreed with an employer, the processing time for claimsis two weeks.It must be remembered that if the long-term care insurance fund fails to respond to a claim in writingwithin five weeks of receipt or if the shorter assessment periods are not observed, the insurance fund isrequired to pay the claimant an amount of€70for each week of delay begun after the deadline. This doesnot apply if the long-term care insurance fund is not responsible for the delay or if the claimant is ininstitutional care and is already officially classified as in need of considerable care (Care Level I).The insured person may appeal against the insurance fund’s decision.
Determining care needsThe long-term care insurance fund asks the MDK (or the social medical service (SMD) for those insuredwith sectoral insurance funds) to produce an assessment report for use in evaluating the level of careneeded and the effort involved. This usually happens with the assessor (a care or a doctor) visiting yourhome, having given advance notice. The assessor identifies your needs in terms of basic care (personalhygience, eating and getting around) and of help needed with household chores. If you are privatelyinsured, you submit your claim to your private insurance fund and the assessment is conducted there byMEDICPROOF medical service assessors.For children, the assessment of care needs should ideally be berformed by specially trained medicalservice assessors who are qualifed healthcarers or children’s healthcarers or pediatricians. Whendetermining the level of care needed, the child in need of care is compared with a healthy child of thesame age. However, for babies and small children, the assessment is not, however, based on the amountof care needed relative to the child’s natural age but on the amount of additional care needed.
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Home care and institutional careLong-term care benefits are granted on the basis of your care requirement level and whether you needcare at home or institutional care. Regardless of the level of care you receive, prevention andrehabilitation (measures to overcome, reduce or prevent an increase in your need for long-term care) aregiven priority over care. Home care is also given priority over institutional care.
Home careThe main ‘provider’ of long-term care has always been the family. People who live at home and need helpwith day-to-day activities are usually taken care of by their relatives. This is a good arrangement becausemost people who need long-term care want to live with their families and in familiar surroundings as longas they can. Hence, home care must be given priority over institutional care. The law thus focuses onproviding benefits that improve conditions for home care and relieve the burdens on carers.Home care benefits are scaled according to the care level. People in need of long-term care can choosebetween non-cash benefits (care provided by an agency under contract to your long-term care insurancescheme, such as a social services agency or home care service) and cash benefits (which you would useto ensure that you receive appropriate care, for example with the help of relatives). As of 1 January 2013,it is also possible for people with considerable restrictions on their everyday activities to be classified asCare Level O and receive either non-cash or cash benefits. They may also receive a combination of non-cash and cash benefits. As a result, your care can be tailored to your individual needs. A group ofindividuals in need of care, for example those living in new forms of housing, may pool their home careentitlements and share the benefits to be had from efficient management of available resources –particularly as regards nursing care services.Additional benefits provided under long-term care insurance:Nursing aids that facilitate long-term care, such as a special bed.Allowances to pay the cost of modifying your home to accommodate your nursing care needs. Amaximum of€2,557can be granted for each project if there are no other means of financing it.People classified as Care Level O who face considerable restrictions in their everyday activitiesmay also receive this allowance. The allowance can be paid in an amount up to four times€2,557– meaning a maximum of€10,228– if a group of individuals in need of care or who facepermanent restrictions on their everyday activities live together.Free nursing care courses for relatives and volunteer carers.
Statutory long-term care insurance benefits are halved for holders of statutory long-term care insuranceentitled to part-payment (Beihilfe) or full payment (Heilfürsorge) of healthcare, childbirth, long-term careand funeral costs under the laws or principles applicable to tenured civil servants (Beamte). Theinsurance contributions are halved in this instance. In the case of tenured civil servants with private long-term care insurance, the private insurance company provides a share of the above benefits proportionateto the Heilfürsorge entitlement.Allowance for groups cared for in the homePeople in need of care and who are classified as Care Level I, II or III, who receive cash benefit and/ornon-cash benefit, and who live with others in need of care in a shared home in which they all receive out-patient care and in which a carer organises, manages and provides the care, also receive an additionalmonthly allowance of€200.To be eligible for this allowance, at least three people in need of care mustlive together as a group for the purposes of pooling their care services, and they must decideindependently on the services to be provided to them and on the care agency to provide them.
Arrangements for holiday stand-insIf the person who provides your care at home goes on holiday or is otherwise unable to care for you, youare entitled to a stand-in for a maximum of four weeks a year, with costs being covered up to a maximumof€1,550per year. If the stand-in is a close relative who is not employed for the purpose, the costsincurred by the statutory long-term care insurance may not exceed the care benefit for the respectivelong-term care category. This can be increased up to€1,550to cover any documented necessary costs
- 85 -(e.g. travel costs or loss of earnings) incurred by your stand-in. If you are classified as Care Level O,meaning you face considerable restrictions on your everyday activities, you may claim preventive careassistance, whereby for a period of four weeks per calendar year, you receive an amount equal to half ofthe care benefit you already receive.
Part-time institutional care and short-term careIn the event that it is not possible to obtain sufficient care in your own home, or if there is a need tosupplement and augment your home care, you can receive part-time institutional care in a facility thatprovides day and night care. If this is not enough to cover your needs, you can enter a short-term carefacility. In such cases, your long-term care insurance will cover indefinitely the costs of basic care, socialservices and treatment in a day and night nursing care facility, up to€450, €1,100or€1,550a monthdepending upon the level of care you require, and up to€1,550for a maximum of four weeks’ short-termcare in a calendar year.Apart from the entitlement to day and night care, you retain a fifty percent entitlement to home careservices or care benefit. If you only use fifty percent of your entitlement to day and night care, you arealso entitled to receive full care services or the full amount of care benefit.During a period of short-term care, half of the care benefit already received is paid for up to a maximum offour weeks in a calendar year. Short-term care is available for children in need of full-time care up to theage of 25 in facilities for the disabled or other suitable facilities.
Supplementary allowance for people in need of significant careIf they are cared for at home, people with significantly reduced abilities (mental illness, disability ordementia) are entitled to a supplementary allowance of up to€100per month (basic benefit) or up to€200per month (increased benefit), or up to€1,200or€2,400per year. People classified in Care Level Omay also receive this supplementary care allowance.This group may also make use of six-monthly advisory visits. These visits may also be conducted byrecognised providers; to be officially recognised, no proof of nursing care expertise is needed.The supplementary care allowance is to be used solely for the purpose of hiring quality-assured careservices as prescribed by law. It serves to reimburse expenses incurred by the patient when hiring day ornight nurses, short-term care, recognised care providers (provided that the expenses relate to specialservices of general supervision and care rather than to basic care and housekeeping) or low-level carerecognised under Länder law (e.g. care groups for dementia sufferers, help groups who stand in on anhourly basis to relieve relatives providing care in the home, daycare in small groups, individual careprovided by recognised helpers, and family support services).
Institutional careAdditional care and enabling services are available for people with significantly reduced abilities who arelooked after in nursing homes. Additional carers can be deployed for such full-time and temporaryresidents of care homes. The rule is one additional carer for 24 nursing home occupants sufferingdementia. The costs are met in full by the statutory and private long-term care insurance funds inaccordance with agreed arrangements. Those in need of care and agencies providing social assistanceare not required to meet any of the costs.
Social security insurance for carersHome care places heavy burdens on carers, most of whom are women. Carers often have to give up theirnormal job or cut back on the number of hours they work in order to meet these demands. In response tothis situation, new legislation has improved the treatment of carers in social security matters. Carers alsocome under statutory accident insurance for the time during which they are providing care (information ona brochure on statutory accident insurance for carers is provided in the occupational accident insurancechapter).
- 86 -If you provide non-paid nursing care for another person for a minimum of 14 hours a week in thatperson’s home and are not employed or work no more than 14 hours a week, you are now covered bystatutory pension insurance if the person in need of care is entitled to assistance from the statutory orprivate long-term care insurance funds. Time spent caring for two or more people in need of care can becalculated together. Your contributions are paid by the long-term care insurance fund. Your contributionrate depends upon the level of care you provide and the amount of time you must consequently spendproviding care. If you take a holiday to give you a break from providing nursing care, your pensioncontributions will be paid by the long-term care insurance fund for the duration of your absence.Contributions to unemployment insurance are only paid by the long-term care insurance fund for theperiod in which you provide nursing care. With effect from 1 February 2006, and having fulfilled certaincriteria, you may opt to be voluntary insured and thus retain your entitlement to unemployment insurance.Contact your local Employment Agency for further information on this.
Reconciling family care and workCare leaveCare in the home is also promoted by the Home and Institutional Care Act (Pflegezeitgesetz) whichsafeguards the interests of the relatives of a person in need of home nursing care and takes specialaccount of the differing care-related situations and types of care needed. The Act’s provisions rest on twopillars to ensure care is provided in all situations:When a particular care situation occurs unexpectedly, employees have the right to take up to tendays off work (temporary absence). They are thus given the opportunity to respond to anemergency situation, inform themselves of the care services available and make arrangementsfor their provision. The right to temporary absence from work should only be used to ensure thata person in need of care who cannot immediately be accommodated in a suitable nursing homeafter a stay in hospital can be looked after by relatives at home in the interim. The right totemporary absence from work applies to all employees regardless of the size of the regularworkforce.Employees who providing nursing care for a dependent relative at home or wish to care for aterminally ill relative are also entitled to be released from work for a maximum of six months (careleave). Employees may choose between full-time and part-time care leave.
The entitlement to care leave may be exercised if the employer has a workforce of fifteen or more. It iscoupled with the right to return to work under the same terms following a period of care leave (specialprotection against dismissal). This ensures that anyone who is willing to care for a dependent relative issafeguarded against losing their job. The option for part-time care leave and the right to return to full-timeemployment also prevent any disadvantages as regards upward mobility.Necessary social security cover is maintained during care leave. Care leave is deemed as a qualifyingperiod and the long-term care insurance fund pays contributions to the unemployment insurance fund.Under the health insurance and long-term care insurance schemes, long-term care insurance provides fora supplement to help with contributions to pay for voluntary insurance in cases where there is no otherinsurance provision, for example in the absence of family insurance. This supplement is equal to theactual amount payable. As was the case before the introduction of care leave, the pension insurancescheme covers compulsory contribution periods for stints of non-employed care at home if the care isprovided for a minimum 14 hours per week and the person in need of care receives services and benefitsfrom the long-term health insurance fund. Employees may not work more than 30 hours per week duringcare leave taken in the form of part-time leave. The contributions to the state pension insurance fund areassumed by the long-term care insurance fund regardless of the care category involved and the scope ofthe care provided.
Family careFamily care periods provide another opportunity to reconcile work with caring for a family member. Witheffect from 1 January 2012, Germany’s Family Care Leave Act (Familienpflegezeitgesetz) provides foremployees to care for a close relative by reducing their working week to as much as 15 hours for a periodof up to 24 months. During this family care period, employees are protected against dismissal and their
- 87 -pay is supplemented in an amount equal to half of the reduced pay received as a result of working part-time to care for a family member. This supplement takes the form of an advance of pay paid by theemployer. When the family care period expires and the carer returns their normal working week, theemployee continues to receive the reduced amount of pay until the pay advance is cancelled out.Employees have no legal entitlement to family care periods. Instead they must reach a written agreementwith their employer.For further information, see: www.familien-pflege-zeit.de (in German only).
Institutional careIf you require institutional care, your long-term care insurance will pay expenses for basic care, socialservices and treatment according to the level of care you require:€1,023for Level I,€1,279for Level II, or€1,550for Level III care. To avert hardship, up to€1,918in expenses will be covered if you require LevelIII care. As with home nursing care, you are responsible for paying your costs for food and board.Long-term care insurance cannot meet more than 75 percent of the actual amount paid to the nursinghome. This means that patients must pay at least 25 percent of their nursing home costs themselves.
Care advice and support facilitiesPeople in need of long-term care have a legal right to care advice, meaning help and support from a careadvisor at their statutory insurance fund or private insurance carrier. The advisor’s services include:Identifying and analysing the level of care needed, taking account of the MDK assessmentDrawing up a personal care plan which includes the necessary social and healthcare services –preventive, curative, rehabilitative and other medical and nursing care – and welfare servicesDeveloping the necessary measures to allow implementation of the personal care plan, includingits approval by the respective service providersMonitoring implementation of the personal care plan and, where necessary, adapting it to achange in needsEvaluating and documenting the care process in extremely complex cases
Long-term care advice must include all parties involved in care provision.Where care support facilities exist, the advisory services offered there cover all long-term care, medicaland social services. The facility provides a common roof under which employees from the long-term careand health insurance funds, senior citizens’ services and social services organizations can coordinatecare provision and advise the individual involved.The German Association of Top Health Insurance Funds (Spitzenverband Bund der Pflegekassen) haspublished a set of recommendations on both the number and the qualifications of long-term careadvisors.When requested, long-term care advice may also be provided free of charge in the home of the person inneed of care. After receiving an initial application for long-term care advice and support, the long-termcare insurance fund must:Either offer an advisory appointment at a date no later than two weeks after receipt of theapplication and name a point of contactOr issue an advisory services voucher, naming independent, neutral advisory services where thevoucher can be redeemed at the insurance fund’s cost within two weeks from receipt of theapplication
If the applicant wishes the advisory appointment may arranged at a later date.Also, the long-term care insurance fund must inform applicants that they are entitled to receive a copy ofthe assessment and the separate rehabilitation plan completed by either the MDK or another expertcommissioned by the insurance fund.
- 88 -Anyone who is privately insured should contact their insurance carrier or the German Association ofPrivate Health Insurers (Verband der privaten Krankenversicherung e.V.), Guastav-Heinemann-Ufer 74c,50968 Köln. Private long-term care insurers provide long-term care advice via a centralised hotline rub bythe agency COMPASS Private Pflegeberatung. The hotline is available Mondays to Fridays from 8 am to6 pm, and from 10 am to 4 pm on Saturdays (0800 1018800). Care advice may also be provided by acare advisor who visits the person in need of care at home, in a residential care home, in hospital or in arehabilitation clinic.
Long-term care for residents of care homes for the disabledYoung disabled persons who require nursing care are entitled to all the benefits described above. Long-term care insurance will also provide a flat-rate allowance to help cover the cost of treatment at facilitiesthat primarily focus on helping disabled people integrate into society, as opposed to providing nursingcare. Residents of long-term care homes for the disabled are also entitled to the full amount of long-termcare benefit for the days they are cared for in their own home.
FundingStatutory long-term care insurance is financed through contributions that are scaled according to income.The contribution assessment limit that applies to health insurance also applies to long-term healthinsurance:€3,937.50a month in both western and eastern Germany in 2012.As of 1 January 2013, the contribution limit is 2.05 percent of assessable income.Contributions are paid following the same method used for statutory health insurance payments: Youremployer deducts your contributions directly from your wages and transfers them to your health insurancefund. To compensate employers for the additional costs arising from long-term care insurance, the Buss-und Bettag holiday (the Wednesday eleven days before Advent) was eliminated except in the state ofSaxony. German employers bear half the contributions to long-term care insurance in return for thisadditional working day. In other words, employees pay a rate of 2.05 percent and employers 1.025percent. In Saxony, which kept Buss- und Bettag, employees pay 1.525% and employers 0.525%.As of 1 January 2005, childless contribution payers– irrespective of the reason for their childlessness –are required to pay a supplement of 0.25%, raising the contribution share paid by, for example, achildless employee from 1.025% to 1.275%. This complies with a decision of the Federal ConstitutionalCourt requiring a difference in contribution rates between contributors with and without children. Childlesscontribution payers born before 1 January 1940 are exempt from the supplement, as are children andyoung people up to age 23, recipients of Unemployment Benefit II, and young men on military or civilianservice.Pensioners’ contributions paid from their pensions and contributions towards annuities and income fromself-employment are paid by the pensioners themselves.For employees who pay voluntary contributions to the statutory health insurance fund, the employer paysan amount equal to half of the employee’s income-related contribution to long-term care insurance.Employees with private long-term care insurance also receive an employer contribution which is limited tohalf of the amount the employee pays for their private long-term care insurance.Contributions for recipients of unemployment benefit or cost-of-living allowance are paid by the FederalEmployment Agency or the authorized municipal provider (for rehabilitation recipients the rehabilitationprovider, for residents of care homes for the disabled the home, and for recipients of other welfareassistance towards the cost of living, the responsible welfare services agency).pays the supplements for recipients of unemployment benefit, cost-of-living allowance, short-timeallowance, training allowance, transitional allowance and, to the extent the Agency is required to paycontributions for them, vocational training grants (Berufsausbildungsbeihilfe) under the Third Book of theSocial Code (SGB III), in the form of a€20million annual lump sum to a statutory long-term careinsurance equalisation fund maintained by the Federal Insurance Office. Individual members do not haveto pay any supplement, but the law makes provision for the Federal Employment Agency, subject toapproval from the Federal Ministry of Labour and Social Affairs, to reclaim contributions paid on theirbehalf.
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Private long-term care insuranceRather than being calculated on the basis of your income (as is the case with private health insurance),premiums for private long-term care insurance are graded according to your age when you sign thepolicy. By law, premiums cannot exceed the maximum contribution for statutory long-term care insurance.If you took out private health insurance after 1 January 1995, this limit will apply after a five-year periodduring which you have been covered by private health or long-term care insurance. Tenured civil servantswhose medical costs are reimbursed in part by the government if they ever need long-term care do nothave to pay more than half the maximum amount.The premiums are the same for men and women. The private long-term care insurance rate for marriedcouples where only one spouse works, or where both work but one of their incomes is low enough toqualify as marginal employment, may not be more than 150% of the maximum rate for statutory long-termcare insurance. The married couple rate does not apply for those who took out private health insuranceafter the introduction of compulsory private long-term care insurance on 1 January 1995. Children receivefree cover, as they do under statutory long-term care insurance.Further informationThe German Federal Ministry of Labour and Social Affairs runs a citizens’ information hotline on long-term care insurance. Tel. 030 340606602, Mondays to Thursdays, 8 am to 6 pm, and Fridays from 8 amto 3 pm. The Ministry also provides free advisory brochures entitled Ratgeber zur Pflege (Advice on Long-Term Care), Pflegen zu Hause (Long-Term Care at Home) and Wenn das Gedächtnis nachlässt (DealingWith Dementia).Information on health insurance and long-term care insurance abroad is provided on a case-by-casebasis by Deutsche Verbindungsstelle Krankenversicherung/Pflegeversicherung – Ausland (DVKA),Pennefeldsweg 12c, 53177 Bonn. Telephone: 0228 95300. The DVKA became a member of the GermanAssociation of Top Health Insurances (Spitzenverband Bund der Krankenkassen) on 1 July 2008.Information on involving disability (including issues regarding health and long-term insurance) may alsobe addressed to the local rehabilitation services agency (Gemeinsame Servicestelle derRehabilitationsträger).Advice and support can also be sought from the local authorities responsible for old-age benefit.
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Pension insuranceRentenversicherungWelfare and pension insurance go hand in hand. For decades now, pension insurancehas played an important role in providing people with the financial security they need inold age.
Who is insured?With few exceptions, all employees pay compulsory contributions to the state pension fund – as dotrainees, disabled people employed at sheltered workshops, people on military or civilian service, andpeople doing a year of voluntary community or environmental service.The contribution assessment limit for 2013 is€5,800a month in western Germany and€4,900in easternGermany. This is not the limit for compulsory membership of the state pension fund; that is, even if youearn more, you must still pay contributions. The contribution assessment limit is the maximum amountfrom which your contributions to the state insurance fund are calculated, even if you earn more.Special provisions on contribution payments apply for employees with low earnings from 1 January 2013.The ‘progression band’ contribution scale reduces employee contributions in line with earnings and isapplied automatically. With the increase from 1 January 2013 of the mini-job ceiling of€400to€450,theprogression band rules apply for earnings ranging from€450.01to€850.Within the progression band, theemployee share of total social insurance contributions (health, pension, long-term care andunemployment insurance, currently averaging 21% in total) increases linearly with earnings from about4% at the bottom end of the progression band (€450.01) to the full employee share at€850.Theemployer continues to pay the employer’s share of the total social insurance contributions for the fullamount of the employee’s pay. These provisions do not apply to trainees.Important: As pensions are always calculated on the basis of the (lower) amount of pay for whichcontributions are paid in, employees can sign a declaration and submit it to their employer in which theyopt to pay contributions matching their full pay. They then pay full employee contributions even in theprogression band and their full pay is taken into account when determining their pension.Not all self-employed people have to pay compulsory contributions. Those who must include self-employed teachers, lecturers, child carers, nursing carers and midwives. Self-employed tradespeoplealso pay compulsory contributions, although they may opt out after 18 years. Self-employed artists andmembers of the publishing professions have to pay contributions under the Artists Social Welfare Act iftheir annual income exceeds a set minimum, and until they have been five years in the profession –though they pay only half the contributions themselves. Contributions are subject to a minimum annualincome of€3,900generated through self-employment, but which those new to the respective professionsare not required to attain. The Artists’ Social Welfare Fund (Künstlersozialkasse) in Wilhelmshavendecides who must pay contributions and also sets the rate.From 1 January 1999, you must also pay contributions if you are self-employed and in your self-employedcapacity do not normally have any employees who must pay contributions themselves, and you primarilywork on a long term basis for a single client or employer. You are considered to work primarily for a singleclient or employer not only if you work primarily under contract to one client or employer, but also if youare economically dependent upon such a client or employer.People starting a new business with only one customer can be exempted from paying contributions for upto three years. An exemption can also be claimed by people who are already near retirement age.Farmers are not insured under the state pension scheme, but with a separate farmers’ pension fund. Thisspecial system provides farmers with partial cover, which they supplement in other ways – often by sellingthe farm on retirement or claiming Altenteil, the right of German farmers to live on the farm after making itover to their children.
- 91 -Self-employed people who are not required to pay compulsory pension contributions can apply to bemade compulsory members of the pension fund within five years of becoming self-employed. They thenhave the same rights and obligations as other compulsory contributors.Child-raising periods: Mothers and fathers are automatically insured during the initial child-raising period.Up to three years are credited for children born since 1 January 1992, and up to one year for childrenborn earlier. These contributions are paid by the federal stateCarers: You are automatically insured without having to pay contributions if you look after a relative whoqualifies as being in considerable need of care. Your contributions are paid by the long-term careinsurance fund.Claimants of income-replacement benefits continue to be compulsorily insured (with the exception ofrecipients of unemployment benefit II) if they were so insured in the year before they began drawingbenefit. If not, they can usually apply for compulsory membership of the pension fund. Income-replacement benefits include sickness benefit, injury benefit, transitional allowances, unemploymentbenefit, unemployment benefit II, cost of living allowance, pre-retirement benefit, and early retirement pay.The contributions are paid by the agency awarding the benefit.
Who is exempt from insurance?Marginal permanent employmentIf you are in marginal employment, you are exempt from paying social insurance contributions.Short-term employment is characterised by the fact that your employment relationship tends to be limitedto a maximum of two months or 50 working days in a calendar year (as predicted from the type and scopeof the work) or is limited by prior contractual agreement (for example under a fixed one-year frameworkemployment contract). How much you earn from it does not affect whether your employment isconsidered short-term. The employment must not be a regular occupation or, if it is, must not exceed€400a month. If you are in short-term employment, you are exempt from pension insurance and youremployer is not required to pay a lump-sum pension contribution.
Who can pay voluntary contributions?From 2013, low-paid workers in full-time indefinite employment may request to be made exempt frompaying social insurance contributions if their monthly income does not regularly exceed€450.Up to theend of 2012, this ceiling was set at€400per month and employees with incomes up to this amount wereautomatically exempt. Your employer pays a 15% flat-rate pension insurance contribution. A lower flatrate of 5% applies for marginal work in a private household, which is classed as a special form ofmarginal employment.You are then required to top up the flat-rate employer’s share to make up the full contribution (the fullcontribution in 2013 is 18.6%, so people in marginal employment in private households have to top up the5% flat rate by a further 13.9% and all others in marginal employment have to top up the 15% flat rate bya further 3.9%). This gains you entitlement to all statutory pension benefits, including rehabilitationtreatment, reduced earning capacity pensions, credit months for an early-retirement pension, and‘Riester’ pension supplements. Employees on less than€175a month pay a minimum contribution basedon€175,on which the employee’s share is credited.In contrast to the existing requirement for you to be insured, if you are exempt from paying socialinsurance contributions and entitlements accrue in the form of one month for every month of employment,you may only accrue a marginal number of qualifying period months. Also, if your marginal employmentmakes you exempt from paying social insurance contributions, you are not entitled to a pension andpension entitlements are less than they would be if you were required to have insurance.
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Multiple employment relationshipsIf you have several marginal or several short-term employment relationships, the employmentrelationships in each category are added together. If you exceed the above exemption limits as a result,you are required to pay all contributions for all forms of social insurance and have no legal right toexemption from the statutory pension insurance system.The following applies if you have one or more marginal employment relationships as well as a mainemployment relationship subject to compulsory contributions:If you have one marginal permanent employment relationship besides your main employment on whichyou pay compulsory contributions, the two are not counted together to make the marginal employmentsubject to contributions as well. If you have any further marginal employment relationships, they do counttogether with your main employment on which you pay compulsory contributions and are subject to fullcontributions (except for unemployment insurance) themselves. Short-term and marginal permanentemployment relationships are not counted together in this way, and a short-term employment relationshipdoes not count together with your main employment on which you pay compulsory contributions.Exceptions are made for certain groups such as trainees and people with disabilities, who still have to paycontributions even if they come under the criteria for marginal employment.Individual assessments regarding social insurance contributions are performed by local health insurancefunds, and in the case of people engaged in marginal employment by the Deutsche RentenversicherungKnappschaft-Bahn-See pension fund as a central collection agency (www.minijobzentrale.de). This andother social insurance agencies also provide information and advice.
Who can pay voluntary contributions?If you do not pay compulsory contributions, as a rule you can pay voluntary contributions to the generalpension funds. This option is mainly intended for self-employed people and housewives.
RehabilitationGerman pension law expressly puts rehabilitation before a pension wherever possible. The pensioninsurance funds examine all applications for reduced earning capacity pensions to see if rehabilitation is aviable alternative and would remove the need for a pension.
Who can claim a pension?To claim a pension, you must have paid contributions and satisfy certain legal and personal conditions.Statutory pension insurance provides:Old-age pensionsReduced earning capacity pensionsSurviving dependants’ pensions (pensions on account of the insured person’s death)
Qualifying periods as a basic condition for entitlement
You can only claim a pension if you have been insured for a minimum period. Thisis known as the qualifying period (Wartezeit). The general 5-year qualifying periodcan be made up with contribution periods and substitute qualifying periods and is abasic condition for claiming a standard old-age pension, a reduced earningcapacity pension or a surviving dependants’ pension. The 15-year qualifying period for drawing an old-age pension on account of unemployment or after partial retirement or an old-age pension for women canlikewise be made up of contribution periods and substitute qualifying periods. The 35-year qualifyingperiod for a long service pension or severe disability pension can additionally be made up with exemptperiods, and certain child-raising periods are taken into account. The exceptionally long-service pensionhas a 45-year qualifying period. Compulsory contributions for employment subject to insurancecontributions (excluding periods claiming unemployment benefit) and credit periods are taken intoaccount. Exempt periods include some periods of education and training and periods of illness orunemployment.
The German FederalMinistry of Health andSocial Security runs acitizens’ information lineon pensions. Tel. 030221911001, Mondays toThursdays, 8 am to 8 pm..
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Early qualificationAs a rule, the five-year qualifying period must be completed to claim a reduced earning capacity pensionor a surviving dependant’s pension, but earlier qualification is possible on reduction in earning capacity ordeath following an occupational accident or an injury on military or civilian service. Insured persons canalso claim a full reduced earning capacity pension, or surviving dependants on the insured person’sdeath, within six years of completing education or training if compulsory contributions were paid for atleast one of the two years before the reduction in earning capacity or death. This two-year periodextends, up to a maximum of six years, by the duration of school education from age 17.
Old-age pensionsOnly the insured person can claim an old-age pension. You must have reached a set age (the minimumage limit). Depending on the type of pension, certain other conditions may also have to be fulfilled.
Pensions from age 67Under a law aiming to adjust the minimum pensionable age in line with demographic change and to placethe statutory pension insurance systems on a sounder financial footing (the Rentenversicherungs-Altersgrenzenanpassungsgesetz), the minimum age for a standard pension in Germany is to be graduallyincreased from 65 to 67 between 2012 and 2029; the minimum ages for other pensions are to increaseaccordingly. Planning security is given in that the rise in the minimum pensionable age decided in 2007only began in 2012 and involves very gradual phases. By stretching its implementation over a period ofseveral years, employees and employers are given ample time to plan accordingly.The adjustment affords particular planning security for people born in or before 1954 if they signed abinding partial retirement agreement prior to 1 January 2007. Also, amendments to the employeeprotection provisions under labour law in Book VI of the Social Code ensure that employees with limitedcontracts that end on a given date within which they are entitled to old-age pension prior to reaching theminimum pensionable age are allowed to continue working in accordance with the gradual increase in upto age 67.Information on these changes is given below under the heading ‘Pensions from age 67’.
1. Standard old-age pensionYou can claim the standard old-age pension (Regelaltersrente) when you reach the current pensionableage of 65 if you have completed the 5-year general qualifying period. There is no limit on the amount thatcan be earned on top of a standard old-age pension.(See under the heading ‘Pensions from age 67’ regarding people born 1947 or later.)The pensionable age at which standard old-age pension can be claimed will be gradually raised to 67 foranyone born in or after 1947. The gradual phases involve one month per birth year (standard pensionableage from 65 to 66) and then two months per birth year for people born in 1959 or after (standardpensionable age from 66 to 67). For those born before 1947, the standard pensionable age remains at65. The standard pensionable age of 67 applies for anyone born from 1964 onwards.People born in 1948 reach the standard pensionable age in 2013, aged 65 and two months.
2. Long service pensionWith the start of the gradual raise in pensionable age on 1 January 2012, a new long service pension wasintroduced. Insured persons can claim long service pension in full upon reaching age 65 if they have paidcompulsory contributions for a minimum of 45 years, either through insurable employment, self-employment, long-term care or periods of childrearing until a child reached is ten years old.
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3. Reduced Old-age pensionInsured persons can claim a reduced old-age pension if they:Have reached the age of 63Have completed the 35-year qualifying period
The age limit for reduced old-age pension will rise gradually for people born in 1949 or after, from 65 to67. The earliest age at which reduced old-age pension can be claimed remains at 63. The plan underexisting law to reduce the earliest age at which old-age pension may be claimed to 62 will not go intoeffect. The reduced old-age pension amounts to 0.3 percent of the pension for each month earlyretirement pension is claimed.
4. Old-age pension for people with severe disabilitiesInsured persons can claim an unreduced severe disability pension (Altersrente für schwerbehinderteMenschen) if they:Have reached the required ageAre recognised as having a severe disabilityHave completed the 35-year qualifying periodThe pensionable age for people with a severe disability will be gradually raised from 63 to 65 for anyoneborn in 1952 or after, and from 60 to 62 for the earliest age at which pension may be claimed. Reducingpension amounts to 0.3 percent of the pension for each month early retirement is claimed. Thisrepresents a maximum reduction of 10.8 percent.Planning security is provided for:People born in 1954 or after if they signed a binding early retirement agreement before 1 January2007Were recognised as having a severe disability in accordance with Section 2 (2) of Book IX of theSocial Code.
For this group, the pensionable age of 63 or 60 will not be raised if they claim early retirement.For reasons of fairness, an unreduced severe disability pension can be claimed from age 60 by insuredpersons who were 50 before 16 November 2000 and were recognised at that time as having a severedisability under Section 2 of Book IX of the Social Code (SGB IX) or as having an occupational disabilityor reduced earning capacity under prevailing law.People are recognised as having a severe disability if their degree of disability is at least 50 and theirplace of residence is in Germany or a member state of the European Union. The degree of disability isassessed by the war pensions office (Versorgungsamt). People who do not have a severe disability maybe entitled to a severe disability pension if they were born before 1 January 1951 and have anoccupational disability or reduced earning capacity under prevailing law as applicable since 31 December2000.
5. Old-age pension on account of unemployment or after partial retirementInsured persons born before 1 January 1952 can claim an unreduced old-age pension on account ofunemployment or after partial retirement (Altersrente wegen Arbeitslosigkeit oder nach Altersteilzeitarbeit)if they:Have reached the minimum age limitHave completed the 15-year qualifying periodHave paid compulsory contributions in employment or an activity subject to pension insurance forat least eight of the ten years before payments are due to beginAre unemployed when payments are due to begin and have been unemployed for at least 52weeks since reaching the age of 58 years and six months or have been in partial unemploymentfor at least 24 months when payments are due to begin
- 95 -An exception is made for insured persons who before 1 January 2004 entered into a binding agreementterminating their employment relationship (such as a partial retirement or severance agreement) or werealready unemployed or without work on that date. The minimum age limit for claiming the pension is 60.The minimum age of 60 (with planning security) or 63 (without planning security) for early retirementpension and the age limit of 65 for claiming standard old-age pension on account of unemployment orafter a period of part-time retirement remains unchanged and will not rise in line with the rise inpensionable age.The 10-year period in which there must be eight years of compulsory contributions is extended in favourof the insured person in certain circumstances, for example when the 10 years include credited periodsand in particular periods of unemployment not subject to compulsory contributions.Partial retirement is defined as at least 24 months in a partial retirement arrangement; it does not matterwhether the partial retirement is partly funded by the employment agency.A certificate from the employment agency is generally required as proof of unemployment.
6. Old-age pension for womenThe old-age pension for women (Altersrente für Frauen) can be claimed – with reductions – by womenborn before 1952 who have:Reached the age of 60Completed the 15-year qualifying periodPaid compulsory contributions in employment or an activity subject to pension insurance for morethan ten years since age 40.The age limit of 60 for claiming early retirement pension and 65 for standard old-age pension remainsunchanged for women and will not be raised in line with the raise in the minimum pensionable age.
Reduced earning capacity pensionsA reduced earning capacity pension (Rente wegen verminderter Erwerbsfähigkeit) makes up for lostearnings if your earning capacity is reduced or you can no longer work at all. To claim, you need to havepaid compulsory contributions for at least three of the five years preceding the loss of earning capacity(including credited periods and child-raising periods that are taken into account), and to have completed afive-year general qualifying period before your loss of earning capacity – unless your reduced earningcapacity results from circumstances that exempt you from the qualifying period.You also qualify if you completed the five-year qualifying period before 1984 and satisfied the pensioncredit requirements for each month from then until the time you began to suffer loss of earnings.A reduced-earning-capacity pension is paid until you reach pensionable age. You can then claim thestandard old-age pension in at least the same amount.The individual pension benefits are as follows:1. Partial reduced earning capacity pension (Rente wegen teilweiser Erwerbsminderung): Insuredpersons who are prevented by a reduction in earning capacity due to health reasons from doing at leastsix hours of paid work a day under the conditions usual on the general labour market are considered tohave partial reduced earning capacity. The partial reduced earning capacity pension is paid at half therate of a full reduced earning capacity pension.2. Full reduced earning capacity pension (Rente wegen voller Erwerbsminderung): Insured persons whoare prevented by a reduction in earning capacity due to health reasons from doing at least three hours ofpaid work a day under the conditions usual on the general labour market are considered to have fullreduced earning capacity. Insured persons who can work at least three but not more than six hours a daybut because of unemployment are unable to turn the additional earning capacity into earnings likewisereceive a full reduced earning capacity pension. The amount of a full reduced earning capacity pension isthe same as a severe disability pension claimed early.
- 96 -3. Partial reduced earning capacity and occupational disability pension (Rente wegen teilweiserErwerbsminderung bei Berufsunfähigkeit): This is paid out to insured persons born before 2 January 1961who have are prevented by a reduction in earning capacity due to health reasons from doing at least sixhours of paid work a day in their existing occupation or in other work they can reasonably be expected toaccept.4. Full reduced earning capacity and disability pension (Renten wegen voller Erwerbsminderung fürBehinderte): Insured persons who were classed as having full reduced earning capacity beforecompleting the five-year qualifying period and have remained so since can claim a full reduced earningcapacity pension after a qualifying period of 20 years. Alternatively, this pension entitlement can be madeup with voluntary contributions.
Fixed-term pensionsPensions on account of reduced earning capacity are generally paid on a fixed-term basis. They are paidon an indefinite basis, however, if:The pension entitlement does not depend on the situation on the labour marketThe reduction in earning capacity is unlikely to be reversed; this is assumed to be the case after atotal of 9 years of fixed-term pension payments
Supplementary incomeStatutory pensions make up for lost earnings or maintenance payments. Up to the minimum age for astandard pension (age 65 for those born 1946 or later), any additional earnings on top of a pension that isclaimed early are subject to supplementary income limits. Supplementary income includes income fromemployment, self-employment and comparable sources. Income from employment does not includeincome received by a carer from a person in need of nursing care provided it is not more than theapplicable nursing-care allowance, nor does it include income received by disabled people in a shelteredworkshop. Pensions received on account of reduced earning capacity are subject to a certain amount ofearnings replacement benefit being counted as supplementary income.
A. Old-age pensionsThe supplementary income limits for old-age pensions depend on whether you have reached theminimum age for a standard pension and whether a full or partial pension is claimed.
1. Standard old-age pensionThere is no limit on supplementary income with the standard old-age pension. If you begin claiming anold-age pension before reaching the minimum age, you will likewise cease to be subject to any limits onsupplementary income when you do reach that age.
2. Old-age pensions prior to reaching the minimum ageSupplementary income limits apply to old-age pensions claimed before reaching the minimum age for astandard pension. If you receive a full pension, you may earn up to€450a month in supplementaryincome before deductions. You are allowed to exceed this monthly limit and earn up to double the limitamount twice in each calendar year (for example because of holiday and Christmas bonuses). Exceedingthe limit does not automatically mean losing your pension. The pension can be turned into a partialpension with a higher supplementary income limit.Regardless of how much you earn, your old-age pension is paid as a partial pension in an amount equalto two-thirds, half or a third of the full pension amount. The amount of supplementary income you areallowed to earn is based on your income in the last three calendar years prior to claiming old-agepension. If you had no income or only a marginal income in the previous year, a general minimumsupplementary income limit applies which amounts to 50 percent of the national average income.If you are not yet drawing a pension, you can ask your pension insurance fund about the supplementaryincome limit (‘Hinzuverdienstgrenze’) that applies to you.
- 97 -If you are already drawing a pension, the supplementary income limit that applies is shown in the noticestating the size of your pension (‘Rentenbescheid’). You are required to notify your pension fund if youexceed the supplementary income limit.
B. Reduced earning capacity pensionsRecipients of reduced earning capacity pensions can likewise earn supplementary income up to a certainlimit. In 2008, if you receive a full reduced earning capacity pension in the maximum amount, you mayearn up to€450a month in supplementary income before deductions. Partial pensions are subject – likeold-age pensions – to a personal limit that depends on the last year’s income you paid contributions on,and a general supplementary income limit, which is a minimum limit for all. You are allowed to exceed themonthly limit and earn up to double the limit amount twice in each calendar year (for example because ofholiday and Christmas bonuses).If you receive a reduced earning capacity pension, you are under a duty to notify your health insurancefund of any employment you take on. If you work because your health condition has fundamentallyimproved, the insurance fund must review your situation to see if the criteria for payment of the pensionare still met. A reduced earning capacity pension may be withdrawn if the health impairment which led tothe pension award no longer exists. The decision lies with the pension insurance fund.
Surviving dependants’ pensions1. Widow’s or widower’s pensionWidows and widowers are entitled to a statutory widow’s or widowers pension (Witwen-/Witwerrente) ifthe deceased spouse completed the general qualifying period and they have not remarried since thespouse passed away. The general qualifying period is five years. The maximum widow’s or widower’spension (grosse Witwen-/Witwerrente) is paid at 55% of the deceased spouse’s full statutory pension(under previous law it was 60% of the deceased spouse’s pension minus the child supplement) if thewidow or widower has reached the age of 45 or has reduced earning capacity or is rearing a child under18 or cares for a dependent child who for reasons of physical, mental or psychological disability is unableto fend for him or herself. The age limit of 45 for the maximum widow’s or widower’s pension will graduallyrise from 45 to 47 in line with the raise in minimum pensionable age. The rules on claiming this pensionwill, however, remain unchanged in respect of current childrearing periods or reduced earning capacity.A widow’s or widower’s pension supplement of 3.6360 additional earning points is paid for the first childraised and of 1.818 earnings points for each additional child. If none of the above criteria are met, theminimum widow’s or widower’s pension is paid at 25% of the deceased spouse’s full statutory pension fora maximum period of 24 months (there was no time restriction under previous law). The survivingspouse’s other income in excess of an exempt amount is deducted from the widow’s or widower’spension.The general rules remain valid for couples who married before 1 January 2002 and where one of thespouses was born before 2 January 1962.Equivalent entitlements apply for civil partnerships.
2. Orphan’s pensionThe orphan’s pension (Waisenrente) is paid up to the age of 18 to the dependent children of a deceasedinsured person. Children still in vocational training or who have a severe disability may claim orphan’spension up to the age of 27. Claims made by older children will only be considered in cases where theyare in an interim period not exceeding four calendar months between two phases (for example, vocationaltraining and military service or civilian service or voluntary service) or are serving a voluntary social orenvironmental year or are unable to fend for themselves due to physical, mental or psychologicaldisability. Orphans who have lost both parents receive one fifth and orphans who have lost one parentreceive one tenth of the full pension plus a supplement. From age 18, other income above an exemptamount is deducted from the orphan’s pension.
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3. Child-raising pensionA further surviving dependants’ pension is the child-raising pension (Erziehungsrente). It is anindependent source of income for people who are divorced and are raising children, and aims to replacechild maintenance lost on the death of a divorced spouse.You can claim child-raising pension if:Your divorced husband or wife has diedIf you are raising a child of your own or a child of your former husband or wifeYou have not remarriedYou yourself completed the general qualifying period before the death of your divorced partnerYou were legally divorced (western Germany: divorces after 30 June 1977 only; easternGermany: divorces after 31 December 1991).The child-raising pension is calculated in the same way as old-age pension. It is paid out of the survivingclaimant’s own pension credit periods and the transferred entitlements after pension splitting. Otherincome above an exempt amount (as for the widow’s or widower’s pension) is deducted from the child-raising pension.
4. Income deduction40% of any other income (from employment, earnings replacement benefit or capital gains) above anexempt amount is deducted from a surviving dependants’ pension. The same applies with regard to civilpartnerships. The general income deduction rules under previous law (income from employment orearnings replacement benefit) remain valid for couples who married before 1 January 2002 and whereone of the spouses was born before 2 January 1962. The exempt amounts for widow’s or widower’spensions and child-raising pensions are currently as follows:Western Germany:€741.05Eastern Germany:€657.89
The exempt amount increases for each child entitled to an orphan’s pension by:Western Germany:€157.19Eastern Germany:€139.55The exempt amounts for orphan’s pensions from age 18 are as follows:Western Germany:€494.03Eastern Germany:€438.59These amounts are linked to current pension amounts and are thus dynamic.
5. Splitting pensions between spousesTo improve women’s ability to provide for their old age, young married couples now have the option tosplit the pension entitlements accrued during marriage. In place of the traditional provision for marriedand widowed couples (each receiving his or her own statutory pension while alive and when one of thespouses dies, the survivor receives a supplementary widow’s or widower’s pension in addition to his orher own pension), married couples may jointly declare that the pension entitlements accrued during theirmarriage be split between them (pension splitting). Splitting usually comes into effect while both spousesare still alive (when the second spouse claims full old-age pension upon reaching pensionable age).Pension splitting gives women higher pension entitlements in their own right which are exempt fromincome deduction and are not forfeited in the event of remarriage. The right to opt for pension splittingmay only be exercised by married couples who have satisfied the pension credit requirements for 25years.Equivalent entitlements apply for civil partnerships.
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How pensions are calculatedContribution periodsThe amount of your pension mainly depends on the income from employment or self-employment onwhich your insurance contributions are paid. Periods you spend raising children or providing unpaid homenursing care also count as contribution periods.How much each contribution period counts towards your pension depends on how your annual incomebefore deductions compares with the average income of all insured persons. Of course, there are times inlife when your income and hence your contributions are lower. Special rules apply, for example forperiods in vocational training, raising children, providing unpaid home nursing care.
Substitute periodsSubstitute periods are part of the social compensation arrangements built into the statutory pensionssystem. They aim to prevent people from being penalised for having missed paying contributions due toevents of the war. They also include periods of political incarceration in former East Germany.
Periods providing home nursing careSince the introduction of long-term care insurance (Pflegeversicherung) on 1.4.1995, periods spentproviding unpaid home nursing care (for at least 14 hours a week) are automatically credited as fullcontributions. Such contributions improve pension entitlements and increase the amount of pension paidout. The contributions are calculated based on the degree of care needed by the person receiving thecare and on the type of home nursing care provided. Long-term care insurance covers the contributionsto the statutory pension fund for people who provide unpaid home nursing care for a dependant. This alsoapplies to people who provide unpaid home nursing care and whose official employment does not exceed30 hours a week. Long-term care insurance contributions are not covered for certain groups who areexempt from paying into the long-term insurance scheme, e.g. people who receive a full old-age pensionupon reaching pensionable age. The monthly pension accrued for providing one year of home nursingcare can amount at a maximum to around€22in western Germany and€19in eastern Germany.
Child-raising periodsFor births on or before 31 December 1991, the child-raising period is the first year that followed the birthof the child. For children born on or since 1 January 1992, the child-raising period is the period until thechild’s third birthday.Child-raising periods improve pension status and increase pension amounts. This means that, amongother things, they are credited to pension entitlements on grounds of reduced earning capacity or age.Thus, for children born before 1992, women who have raised 5 children or raised 2 children and paid 3years’ contributions also receive an old-age pension. For children born from 1992 onwards, raising 2children is sufficient to meet pension entitlement criteria.In pension terms, such periods are credited as if full contributions had been paid from earned income,and from 1 July 2006 as if the child-raising parent earned exactly the average income of all insuredpersons. At present, this amounts to a pension payment of around€28in western Germany and around€25in eastern Germany for each child-raising year. Periods spent raising children are also taken intoaccount.
Child-raising periods that are taken into accountPeriods spend raising children are credited from the day a child is born through to the day it reaches theage of ten. They do not directly affect the amount of pension received and so do not have the same effectas other pension entitlement periods. Child-raising periods are important as they make it easier for long-term insurance holders to fulfil the 45-year eligibility criteria for long service pension, 35 years for earlyretirement pension, provide for greater insurance cover in cases of reduced earning capacity, and help inthe calculation of total pension entitlements for exempt periods, etc.
- 100 -Pension entitlements are upgraded for parents who work during the first 10 years of their child’s life butare forced to work part-time due to child-care commitments and thus earn below average income. Forperiods from 1992, this amounts to a 50% increase in pension payments up to a maximum 100% of theaverage income of all insured persons in cases where a total of 25 years’ pension contributions havebeen paid (including child-rearing periods taken into account).Parents who raise two children under ten receive pension credits in the form of 0.33 earnings points peryear for child-rearing periods not taken into account. This applies for periods from 1992 onwards where atotal of 25 years of pension contribution periods have been completed (including child-rearing periodstaken into account).For parents who provide home nursing care for their child, pension contributions are upgraded from thetime the child is four until it reaches the age of 18. Contributions paid out of statutory long-term careinsurance are upgraded by 50% to a maximum 100% of the average income of all insured persons. Thisalso applies for periods from 1992 onwards where a total of 25 years of pension contribution periods havebeen completed (including child-rearing periods taken into account).
Credited periodsCredited periods mostly apply where individuals are prevented from paying contributions for reasonsbeyond their control. They primarily include periods when incapacitated, unemployed or in search of atraining place or in full-time education from the 17th birthday onwards up to a maximum of eight years.
Added periodsAdded periods apply to reduced earning capacity and surviving dependants’ pensions. The younger theinsured person at the time of reduced earning capacity or death, smaller the accumulated pensionentitlement. Added periods secure adequate provision for the insured person or the surviving dependants.Pensions are calculated as if the insured person had been employed and paying contributions up to age60.
Minimum income pensionIn the case of people with low compulsory contributions, all contributions made in the full amount in theperiod before 1992 are adjusted up to the lesser of 1.5 times their paid value or a maximum 75% of thevalue of contributions levied on the average level of income. For your contributions to be upgraded in thisway, you must have completed the qualifying period of 35 years.
Upgrading of certain compulsory contribution periodsVocational trainingPeriods of actual vocational training are accounted for at a minimum on the basis of actual earnings and,for a maximum of three years, are upgraded from that level to match either the average for all periodscredited over the individual’s insurance career or 75% of the average earnings of all insured persons,whichever is lower.Reduced compulsory contributions for people with disabilitiesThe minimum contribution assessment basis for contributions paid by people with disabilities working instate-approved workshops and similar institutions is 80% of the fixed reference figure. The referencefigure is revised on an annual basis. For 2013, it is€2,695in western Germany and€2,275in easternGermany.Compulsory contributions during military and civilian serviceDuring military and civilian service, compulsory contributions are paid by the federal government basedon hypothetical earnings equal to 60% of the reference figure.
The pension formulaThe guiding principle behind income-based, or rather contribution-based, pensions is that the amount ofyour pension mainly depends on the amount of earned income you insure through contributions over your
- 101 -working life. The income from insurance and self-employment that you insurethrough contributions each year is converted into earnings points. You arealso credited with earnings points during exempt periods, at a rate thatdepends on the income you paid contributions on at other times.Next, a pension type factor determines the insured amount of the respectivepension in comparison with the standard old-age pension.If you claim an old-age pension early or do not start claiming it upon reachingpensionable age, any loss or gain resulting from the longer or shorter pay-outperiod is compensated by an age factor.The current pension value is the monthly pension that an average earnerwould receive after paying contributions for one year. It is also part of thepension formula.
The pension formulaThree factors determine theamount of a pension:PPersonal earnings pointsInsured income (up to thecontribution assessmentlimit) for each calendaryear, divided by theaverage income of allinsured persons, thentotalled over the individual’sinsurance career, andmultiplied by the age factor.TPension type factorA factor depending on whatthe pension is intended toprovide for.VCurrent pension valueThe monthly pension thatan average earner wouldreceive after payingcontributions for onecalendar year (currently€28.07in western Germanyand€24.92in easternGermany).
Total entitlement
Exempt periods and periods of reduced contributions are also creditedtowards a pension. Exempt periods include credited, added and substituteperiods. A period of reduced contributions exists when a compulsory period(e.g. during employment) and an exempt period (e.g. during maternity leave)fall in the same calendar month. For exempt and reduced contributionMonthly pensionperiods, your entitlement is calculated as the average of all (compulsory and=PxTxVvoluntary) contribution periods. Although gaps in your contribution historyreduce your total entitlement, exempt periods or periods of reducedcontributions do not. Child-raising periods that are taken into account increase the value of exemptperiods and periods of reduced contributions.
Pension adjustmentPensions are regularly adjusted on 1 July each year in line with changes in the current pension value forwestern or eastern Germany (as applicable). The total monthly pension amount is determined bymultiplying the current pension value with the other factors in the pension formula.Pension adjustments are based on trends in the income (before deductions) of the active workingpopulation, including their expenditure on statutory and private provision for old age. Adjustments alsoinclude a sustainability factor to take account of the trend in the ratio of pensioners to contributors. If thereis a decrease in the number of contributors, pension increases tend to be lower. If the number ofcontributors rises, pension increases are generally higher as well. With the sustainability factor,pensioners share part of the extra burden resulting from greater life expectancies and the impact of birthrate and employment trends on the funding of statutory pension insurance.A safety clause ensures that the factors curbing pensions growth (personal pension expenditure, thesustainability factor, and negative wage trends) never result in the total monthly pension amount everbeing adjusted downwards.The cumulative downward adjustment not applied due to the safety clause will be offset by halving anypension increases from 2011 onwards until the postponed adjustment is made good.
Pension informationInsured persons receive an annual pension statement from age 27. Pension statements enhancetransparency regarding individual pension entitlements and provide people with a solid base on which toplan for their old age. They are generated on the basis of the pension insurance periods recorded in theindividual’s insurance account, and include projected pension entitlements at the minimum age for astandard pension, with and without pension adjustments. From age 55, people receive pensionstatements once every three years rather than annually. These statements contain more detailedinformation on the individual’s insurance history.
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Pension credits obtained abroadUnder the law on pension credits obtained abroad, individuals in certain clearly defined categories (inparticular including recognised displaced persons and repatriated individuals of German ancestry) aretreated as if they had spent their working lives in Germany.
OrganisationFrom 1 October 2005, pension insurance institutions will be classified as federal institutions and regionalinstitutions. These institutions have names beginning with Deutsche Rentenversicherung (literally,‘German pension insurance fund’). The remainder of the name reflects the institution’s area ofresponsibility. The federal institutions are Deutsche Rentenversicherung Bund (primarily for salaryearners) and Deutsche Rentenversicherung Knappschaft-Bahn-See (miners, railway and maritime). Anexample of a regional pension institution is Deutsche Rentenversicherung Westfalen, covering theWestphalia region. New entrants to the pension insurance system will be told which institution isresponsible for them when they are assigned an insurance number. The same applies in the event ofchanges in responsibility.Pension insurance institutions are supervised by the state.
FundingPension payments are mainly funded out of contributions. Employers and employees each pay half of thecurrent contribution rate (18.9% of the employee’s monthly pay before deductions as of 1 January 2013),up to a contribution assessment limit of€5,800a month in western Germany or€4,900in easternGermany. Pension payments are also partially subsidised by the state.
InformationInformation is available from the insurance offices at town, district and municipal administrations and frominsurance funds’ information and advice services. You may also approach the insurance funds’ electedrepresentatives for the insured (Versichertenältesten).Information on pensions legislation is provided by the Federal Ministry of Labour and Social Affairs,Referat Information, Publikation, Redaktion, Postfach 500, 53107 Bonn, Germany. The German FederalMinistry of Labour and Social Affairs additionally runs a citizens’ information line on pension law. Tel. 030221911011, Mondays to Thursdays, 8 am to 8 pm. Calls from the German telephone network cost€0.14per minute (mobil max. cost Euro 0,42 per minute)Self-employed artists and members of the publishing professions are subject to compulsory insuranceunder the Artists Social Insurance Act (Künstlersozialversicherungsgesetz). The income threshold forcompulsory insurance is€2,900in 2004. All artists and members of publishing professions are subject tocompulsory insurance, regardless of their income, in the first five years of their career.Since 1 January 1995, most self-employed farmers have been subject to compulsory insurance in thefarmers’ old-age pension fund. The established agricultural sector insurance system of western Germanywas introduced in eastern Germany as part of the 1995 agricultural sector welfare reform.
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Promotion of additional provision for old ageFörderung der zusätzlichen AltervorsorgeThe average age of the population continues to rise. The stateThe German FederalMinistry of Labour andpension system is confronted with fewer contributors and growingSocial Affairs runs anumbers of pensioners. To avoid overburdening youngercitizens’ information lineon pensions. Tel. 030generations, pensions can no longer be allowed to rise at past221911011, Mondays tolevels. Additional provision is therefore needed to ensure thatThursdays from 8 am to 8.pm.people can maintain their accustomed living standards into oldage. Provision will have to be more evenly spread across threepillars: statutory old age pensions, company pension plans and personal forms ofprovision for old age. The state provides tax relief and allowances to aid in theestablishment of additional fully funded pensions.
I. Company pension plansCompany pension plans have traditionally been something that employers provide on a voluntary basis.Since 2002, however, employees have a right to have part of their earnings paid into to a companypension plan. Employers must comply with this wish. How they organise company pensions foremployees is a matter for agreement, often at company level or on a collective bargaining basis. If thereis no agreement, each employee is entitled at a minimum to have part of their earnings paid into a lifeassurance policy (an arrangement known in Germany as direct insurance).Company pensions – the ‘second pillar’ of old-age provision – have a number of advantages overpersonal provision:They are often more cost-effective, as transaction and administration costs are spread across alarger group (‘bulk discount’ effect).It is easier to manage from the employee standpoint because they do not need to choose aprovider – that is up to the employer – and avoid a lot of paperwork.Employers often contribute financially to pension provision for employees (this is often laid downin collective agreements).
State incentivesThe state promotes the use of company pension plans by making earnings paidonto them exempt from tax and social security contributions. In 2013,€4,584can be paid into a plan tax-free. The portion of earnings paid into the plan, up toa maximum€2,784,are also exempt from social security contributions.As with private pension arrangements, company pension plans can also bemade subject to ‘Riester’ incentives in the form of financial subsidies and extratax relief.If you choose a bank savingsplan, private pension insur-ance or a fund savings plan,be sure the product bears thenumber of the certifyingagency and the words:“DerAltersvorsorgevertrag istzertifiziert worden und damitim Rahmen des §10a desEinkommensteuergesetzessteuerlich förderfähig”(“Certified pension plansubject to preferential taxtreatment under Section 10aof the Income Tax Act”). Thismeans that the productcomplies with statutoryrequirements. Note thatcertification does not indicatehow much the pension planwill pay out and does notconstitute a guarantee of highreturns.
II. Personal forms of provision for old ageSince 2002, the state has provided incentives for the establishment of fullyfunded private pensions. The ‘Riester’ incentives, named after the formerFederal Minister of Labour and Social Affairs, take two forms: financial subsidies(supplements) and extra tax relief on personal pension savings (as an additionaltax-deductible amount). The options are as follows:Bank savings plansPrivate pension insuranceInvestment fund savings plansHome-ownership pension (Eigenheimrente: see below)
Bank savings plans are particularly well suited to older investors with a shorter saving period and forpeople with a need for greater security. Private pension insurance is particularly well suited to security-
- 104 -conscious younger investors. Funds with a high proportion of shares in their investment portfolio are moresuited to younger people who are willing to accept the risks involved because they have sufficient time tomake up temporary market losses. A common feature of all products is an undertaking by the providerthat at least the amounts paid in (amounts saved plus supplements paid by the state) will be available atthe beginning of the disbursement phase. There is therefore no risk of loss of the nominal amount.Apart from your age and attitude towards risk, it is important to consider the following when choosing apension product:The cost factor:Products with entry costs are more cost-effective the longer the investment period.The risk factor:Think about whether you want to insure yourself against the risk of reduced earningcapacity or whether you want to make provision for your spouse and your children in theevent of your death.The disbursement phase:The supplementary pension must guarantee life-long benefits. Depending on the providerand product, 30 percent of the capital may be paid out in a lump sum at the beginning ofthe disbursement phase.Bequeathing your savings:With bank savings plans and fund savings plans, the amount saved can be bequeathed upto the residual annuity phase (from age 85). This is not the case with private pensioninsurance. You may however agree a guaranteed period in which the pension must be paidout. State incentives usually have to be paid back if a pension is inherited, although thereare exceptions for the surviving spouse: The state incentives do not need to be paid back ifthe inherited retirement savings are transferred to the surviving spouse’s own Riester plan.
State incentives for private pensions are also available to anyone compulsorily insured in the statutorypension system or in the farmers’ pension fund, tenured civil servants (Beamte), certain holders of publicoffice and recipients of reduced earning capacity pensions. Married couples are also eligible: if eitherspouse fulfils the requirements, the other automatically receives the incentives. For this purpose, theother spouse enters into his or her own retirement savings plan and pays a contribution of at least€60ayear.
The state incentivesThe main incentive for private pensions is the pension supplement, which is made up of a basicsupplement for each entitled individual and, where applicable, a child supplement. If a personal pensionagreement is signed, spouses are each entitled to the supplement as well if they pay a minimum of€60per year.Entitlement to the pension supplement is conditional upon a certain minimumown contribution (see table). If this is not paid in full, the supplement isreduced. Additionally, the amount saved towards a ‘Riester’ pension plan canbe claimed up to a maximum amount as special expenditures for which taxrelief can be granted (see table).With the switch over to taxation upon receipt in 2005, the tax concessions forpayments made into pension plans were substantially improved. This allowedself-employed people in particular the opportunity to make provision for theirold age (in the form of ‘Basis’ or ‘Rürup’ pension plans).Taxation upon receiptTaxation upon receipt meansthat income from pension istaxed only when it is paid outto the tax payer – in old age.The contributions paid intopension plans during workinglife thus remain exempt fromtax up to a maximum amountper year.
The Privately Owned Home Pension Act (Eigenheimrentengesetz) of 2008 improved the conditions forincorporating owner-occupied residential property into state-subsidised private supplementary pensionschemes. The Act introduced the following incentives for the purchase of owner-occupied housing:Subsidies and tax relief on payments of principal on certified mortgagesDuring the accumulation phase, the ability to withdraw eligible retirement savings accumulated so farprovided they are used directly for the purchase or construction of owner-occupied residential propertyAt the beginning of the disbursement phase, the ability to withdraw the accumulated retirement savings topay off a mortgage on owner-occupied residential property
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The first two incentives apply to property taken into residential occupation after 31 December 2007. Thethird incentive is also available for property purchased or completed before 2008.The eligible (withdrawn) funds are taxed in a notional disbursement phase (deferred taxation). Taxpayershave a choice as to how and when the tax is paid:1. Taxation on an annual basis for between 17 and 25 years (depending when the disbursement phasestarts; this must be between the taxpayer’s 60th and 68th birthday).2. Lump-sum taxation on 70 percent of the eligible amount invested in theproperty.Further information in German is available online:http://www.bundesfinanzministerium.de/DE/Buergerinnen__und__Buerger/Alter__und__Vorsorge/AltersvorsorgeInformationFor further information,please visit thefollowing websites:www.deutsche-renten-versicherung.dewww.bundesfinanz-ministerium.dewww.warentest.dewww.vzbv.de
Information
You should always keep sight of both company pensions and private pensions and weigh up which optionis most advantageous in your personal situation. It is possible to use both options, having part of yourearnings paid into a company pension plan exempt from tax and contributions while accumulatingpension savings with Riester incentives in the form of supplements and additional tax-deductibleamounts. Whether the Riester incentives are worthwhile in your particular case depends on variousfactors including your personal situation. Generally speaking, however, families with children andemployees in lower income brackets do particularly well out of them.Further information is available from your pension insurance institution. Information about companypensions is provided by employers, works councils and unions.Germany’s FINANZtest consumer magazine regularly compares a wide range of products andrecommends those that fare best. It is also wise to obtain independent advice from a consumer advicecentre (Verbraucherzentrale).
Riester incentivesTax-deductible amount (in addition to pension provision)Basic supplementChild supplement, per childMinimum own contribution net of supplementsMaximum1
up to€2,100€154€1852€30034% minus supplements€2,100minus supplements
Lump-sum bonus for people under 25 entering the jobs market for the firsttime2For children born since 1 January 20083No less than€60(minimum contribution)
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Compensation and assistance for war victimsSoziale Entschädigung und KriegsopferversorgungIn the German social welfare system, if you suffer damage to your health incircumstances for which the state takes responsibility, you are entitled to victim’scompensation. Victims’ surviving dependants may also claim compensation subject tocertain requirements being met.
Compensation benefits are provided for:War victims (who currently make up the largest group of people to receive benefits under theFederal War Victims Relief Act)Victims of violent crimePeople injured in the course of military or civilian servicePeople whose health has been damaged through inoculation-related complicationsPeople who were imprisoned on political grounds after 8 May 1945 in the Soviet occupationalzone, the Soviet sector of Berlin or in any area specified in Article 1, Para. 2 (3) of the FederalDisplaced Persons Act and whose health was impaired as a resultPeople who were imprisoned on the basis of an unlawful sentence under the SED regime (theregime of the Socialist Unity Party of the former German Democratic Republic) and who sufferlasting disability as a result of their imprisonment
The lawThe most important legislation regarding compensation benefits can be found in the following:Federal War Victims Relief ActSoldiers Pensions ActCivilian Service ActReleased Prisoners Assistance ActCrime Victims Compensation ActProtection against Infection ActRehabilitation (Criminal Law) ActRehabilitation (Administrative Law) ActThe two sections that follow deal with pensions and related benefits for war victims and victims of violentcrime.
Pensions and related benefits for war victimsBenefits and conditionsUpon application you will receive benefits to compensate for damage to your health and financial lossesarising from an injury suffered as a result of:Military or equivalent serviceAn accident that occurred in the performance of such serviceConditions typical of such servicePeriods of imprisonment as a prisoner of warDirect effects of war (such as when civilians are injured during an air raid) or violent acts bymembers of occupying forces (such as physical injury or rape).As an injured person covered by compensation law, you are entitled to medical treatment for recognisedconditions arising from your injury:Out-patient medical and dental treatmentHospital treatmentProvision of drugs, dressing materials and therapiesProvision of aids
- 107 -Provision of denturesBenefits to supplement the provision of aids (such as subsidies for buying and/or modifying a car)Balneological treatment at a health resortDomestic help and benefitsSpecial gymnastic exercises for people with disabilities
Important for people with severe disabilitiesIf you have a recognised 50% level of disability, you will also receive medical treatment for any furtherillnesses, provided that it is not already covered by another fund. You are not however entitled totreatment of subsequent illnesses when your earnings exceed the income limit for statutory healthinsurance (€4,125 a month throughout Germany in 2011).You are also entitled to sickness benefits if you are unfit for work as a result of injury, and medicaltreatment including rehabilitation benefits and preventive health care, unless these benefits are providedby other funds.You are entitled to these benefitsAs a severely disabled person, for your spouse, children and other dependantsAs a recipient of nursing care allowance, for people who care for you without payAs a surviving dependantYou also have an entitlement to occupational integration benefits helping you to enter, re-enter orcontinue working in a suitable occupation. You will receive a transitional allowance or maintenanceallowance for the duration of your occupational integration assistance.Pensions are paid to injured persons, widows and widowers, civil partners, orphans and parents. Theamount of the injury pension (Beschädigtenrente) you receive is scaled according to the degree by yourrecognised level of disability (LOD). Your LOD must be at least 25% for you to qualify for an injurypension. Benefits include:A basic pension scaled according to your loss in earning capacity (LOD*). The basic pension paidto severely injured persons increases at age 65A supplementary allowance for extremely severe injuries, scaled in six gradesA nursing care allowance for helpless persons, likewise scaled in six gradesAn allowance to replace clothing and underwear subject to additional wear and tearAn blind person’s allowance to help cover the cost of a guideCompensation for loss of income arising from a partial or total inability to pursue your former orintended occupation as a result of your injuryCompensatory pension and a married dependant’s supplement for severely injured persons toensure that they can cover their living expenses. The injured person’s income – minus certaindeductions – is taken into account when setting the amount of the pension and supplement.Widows and orphans of a person who has died as a result of injury receive a basic pension. Acompensatory pension is also paid to ensure that they can cover their living expenses. Anyexisting income – less certain deductions – is taken into account when setting the amount of thecompensatory pension.A widow will receive compensation for lost income if her income, including basic andcompensatory pensions and any compensatory nursing care allowances, is less than half theincome her late husband would have earned had he not been injured.In the event that the injured person’s death was not caused by his or her injury, the dependantsmay claim widow’s, widower’s or orphans’ assistance provided they fulfil certain requirements.The parents of an injured person who died as a result of his or her injury will receive a parents’pension, provided that they are in need and over 60 years of age, or are invalids. This alsoapplies to adoptive, step and foster parents and, under certain circumstances, grandparents. Anyincome the parents may have – less certain deductions – is taken into account when setting theamount of the parents’ pension.
- 108 -Supplementary benefits provided under the war victims’ welfare scheme include the following:Nursing care assistanceDomestic helpHelp for the elderlyConvalescence assistanceAssistance granted under special circumstances, such as integration assistance for people withdisabilitiesOccupational integration assistance for injured personsSupplementary assistance towards living expenses
Certain benefits are provided under war victims’ welfare schemes and are secondary to benefits fallingunder the Federal War Victims Relief Act. They constitute special assistance and are provided on anindividual basis to supplement primary benefits. The amount is calculated taking existing income andassets into account, except in cases where the applicant’s need is due exclusively to his or her injury.
The lawThe law on compensation and welfare for war victims is set out in the Federal War Victims Relief Act.
InformationCompensation for war victims is the responsibility of war pensions offices. Claims can be submitted tothese, to local authorities, social insurance providers and diplomatic missions of the Federal Republic ofGermany abroad. You may also appeal against a decision at no cost in the social court (Sozialgericht).War victims’ welfare is the responsibility of local and regional welfare providers.Decisions relating to war victims’ welfare may be appealed against at administrative court level.
- 109 -Financial benefits for war victims (from 1 July 2009)Former WestGermany(per month)€1473040506070809010050, 6070, 8090, 100Level ILevel IILevel IIILevel IVLevel VLevel VI50, 6070, 8090100Married dependants’ supplementCare allowanceLevel ILevel IILevel IIILevel IVLevel VLevel VI12316822628639647957664625313874154229306382460396479576646712724666618491.1041.35738742911020419226652536696712972151.5607811,843Former EastGermany(per month)€13010914920025435142551167322283466137203271339408351425511573632414135867539791.2043433819818117023646632585632631911.3846931,635
RecipientsBlind (travel supplement)Basic pension for injured persons**
LOD* (%)
Age supplement on basic pension
Severe disability supplement
Compensatory pension for injuredpersons
Basic pension for widowsCompensatory pension for widowsBasic pension for orphans- having lost one parent- having lost both parentsCompensatory pension for- having lost one parent- having lost both parentsParental pension for- 2 parents- 1 parentSupplement under BVG 51(2) for- 2 parents- 1 parentSupplement under BVG 51(3) for- 2 parents- 1 parentFuneral allowance: fullFuneral allowance: halfClothing grant
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Victims of violent crimeBenefits and conditionsIf your health has been damaged as a result of a violent crime that was committed in the FederalRepublic of Germany or aboard a German ship or aircraft, you are entitled to the same benefits as avictim of war. This also applies to nationals of any other country that provides similar compensation toGermans who fall victim to violence within its borders. This reciprocal treatment does not, however, applyto citizens from other European Union member states.The Second Act Amending the Crime Victims Compensation Act (1993) has extended these benefits toprovide adequate coverage of other foreigners who have been legally resident in the Federal Republic fora longer period. Compensation is determined in part by how long the applicant has lived here – in otherwords, by the level of his or her integration into German society. Compensation is also granted toforeigners whose presence in the Federal Republic is deemed lawful on humanitarian or significant publicinterest grounds. There is a hardship clause for tourists and visitors. Under the Third Act Amending theCrime Victims Compensation Act (2009), Germans and legal aliens living in Germany may also receivecompensation if they fall victim to a violent crime after 1 July 2009 while abroad for a period of less thansix months. As the emphasis here is on looking after the victim rather than any specific responsibility ofthe German state, victims in such circumstances are only paid compensation if none is paid in the countrywhere the crime is committed and if no other welfare system applies. Victims receive medical treatmentfor any injury or health impairment suffered as a result of the crime, and victims or their survivingdependants receive lump-sum compensation. The Federal Ministry of Labour and Social Affairs providessupport in applications for compensation for crimes committed in countries which are member states ofthe European Union (see p. 6).
The lawThe Crime Victims Compensation Act came into force on 16 May 1976. In most cases, it applies only toinjuries arising from acts of violent crime committed after that date. If you suffered an injury throughviolent crime between 23 May 1949 and 15 May 1976, compensation is granted in the form of a hardshipallowance only under certain conditions.Foreigners, who have been protected under the Act since the Second Act Amending the Crime VictimsCompensation Act came into force, receive compensation for crimes committed after 30 June 1990.Compensation can also be paid on compassionate grounds for injuries suffered by foreigners as a resultof crimes committed before this date.
InformationYou may apply for the above benefits at your local war pensions office (Versorgungsamt, any socialsecurity agency or, if you live abroad, a diplomatic mission of the Federal Republic of Germany in anothercountry.Important: Decisions taken by administrative authorities may be appealed against free of charge in asocial court (responsible for social security and related matters). In the event that the benefits correspondto those granted under the war victims welfare scheme, appeals must be made to an administrative court.Note: Compensation for thalidomide victims is not governed by compensation benefit law. Such cases fallunder the Act on the Establishment of an ‘Assistance for the Disabled’ Foundation. Further information isavailable from the Federal Ministry for Family Affairs and Senior Citizens, Rochusstr. 8-10, 53123 Bonn,Germany.
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Social assistanceSozialhilfeSocial assistance (Sozialhilfe) provides a last safety net to protect people from poverty,social exclusion and hardship; it helps individuals and households who are unable andlack the resources to meet their own needs and have insufficient entitlement underother insurance and welfare systems that come before it.The legislation on social assistance was comprehensively reformed in 2003 and nowmakes up Book Twelve of the Social Code (SGB XII). This came into force (with limitedexceptions) on 1 January 2005. The main points and new features are described in thefollowing.
Aims of the new legislation and principles underlying socialassistanceSocial assistance is provided so that everyone entitled to it can live in human dignity. This objective isenshrined in the opening words of SGB XII. Where income and savings fall short, social assistancecovers the human minimum needed to maintain a socially acceptable living standard. It also aims tocompensate as necessary for other impediments such as disabilities, need of nursing care or otherexceptional social difficulties so that people can take part in community life as fully as possible. Reflectingits two main forms, social assistance used to be divided into assistance towards living expenses andassistance in special circumstances. This two-way division has now been replaced by a division intoseven chapters covering assistance in specific sets of circumstances.A further key thrust of social assistance is helping people to help themselves. According to the secondsentence of SGB XII, the assistance aims to empower people to be non-dependent on it as far aspossible, and claimants must contribute towards achieving this to the extent of their abilities. Claimantsand social assistance agencies are also expected to cooperate in attaining this goal.The general principles governing the provision of assistance are as follows:Assistance is tailored to individual needs, taking into account claimants’ circumstances, wishesand abilities (SGB XII, Section 9).As a subordinate benefit, social assistance is not usually granted until all other resources havebeen exhausted – such as use of the income and assets of claimants and where applicableanyone required to support them, claimants’ own earning capacity, and entitlements under otherinsurance and welfare systems that take precedence (SGB XII, Section 2).Social assistance does not have to be applied for. It is granted automatically as soon as itbecomes known to a social assistance agency that the criteria for assistance have been met. Theonly exception is needs-based pension supplement in old age and in the event of reducedearning capacity under Chapter 4 (SGB XII, Section 18).Assistance is provided in the form of services, benefit payments and benefits in kind (other thanservices), with benefit payments generally taking priority over benefits in kind (SGB XII, Section10). Provision of assistance is not restricted to benefits, however, and always includes advice,help in being an active member of the community, and other forms of support towards achievingnon-dependence on social assistance (SGB XII, Section 11).Various provisions give increased priority to non-institutional over institutional assistance. Forexample, institutional forms of assistance are granted subject to an assessment of needs,available alternatives (including non-institutional support) and cost. Similarly, pregnant womenand people with disabilities or in need of nursing care are excepted from a rebuttablepresumption under Section 36 of SGB XII that a claimant’s needs are met by others in a sharedhousehold.The provision of additional services in the form of comprehensive advice, education and support(establishing contacts, accompanying claimants on visits to social services, generatingopportunities for more in-depth consultation) helps people to help themselves and take an activepart in the community.
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The social assistance reform: New challenges and legislativereorganisationWhen the Federal Social Assistance Act came into force in 1962, its aim was to provide temporaryemergency support for specific groups such as senior citizens on low pensions. Poverty among seniorcitizens did decline over subsequent years, but other problems took on increased urgency:Mass unemployment: Long-term unemployed, low-skilled foreign workers and unemployed youngpeople without benefit entitlements increasingly needed assistance towards living expensesThe decreasing stability of family units: For many single parents, assistance towards livingexpenses makes up for insufficient maintenance paymentsImmigrants making up new groups of claimants: Asylum-seekers, civil war refugees, ‘resettlers’from Eastern European countries and unemployed foreign workersDemographic change: Increased numbers of people in need of dependent on assistance towardsnursing careIncreasing numbers of people with disabilitiesThis shifting pattern of circumstances necessitating social assistanceprompted a two-fold legislative response, comprising amendments to bringthe Federal Social Assistance Act into line with the changed social situationand various new pieces of legislation taking specific groups andcircumstances outside the scope of social assistance. An act governingbenefits for asylum-seekers thus came into force in 1993, and anotherintroducing long-term care insurance in 1995. In 2001, Book IX of the SocialCode expressly reclassified social assistance agencies as rehabilitationagencies, but did not aim to establish separate assistance legislation or toreduce the burden on social assistance. Needs-based pension supplementfrom age 65 and in the event of reduced earning capacity between ages 18and 64 was introduced as a separate primary benefit from January 2003and now forms Chapter 4 of SGB XII governing social assistance.In parallel with the incorporation of social assistance as SGB XII, a separateBook II of the Social Code (SGB II) was created for job-seekers able to workand aged between 15 and 64. Members of this group now receive the newbasic security benefits for job-seekers and (under SGB XII, Section 21)cannot claim assistance towards living expenses under Chapter 3 of SGBXII.Separate laws have been passedover the years for specific groups(asylum-seekers in 1993 andrecipients of old-age and reducedearning capacity pensions in2003) and specific circumstances(need of nursing care in 1995),taking them outside the scope ofsocial assistance. Claimants(within the meaning of Section 8,SGB II) capable of earning andaged 15 to 64, together with theirdependants, now cease to comeunder social assistance andinstead can claim benefits underSGB II (basic security benefits forjob-seekers). Needs-basedpension supplement in old ageand in the event of reducedearning capacity now formsChapter IV of SGB XII.
Like social assistance, the basic security benefits for job-seekers encompass services, cash benefits andnon-cash benefits other than services. Their provision likewise takes claimants’ individual circumstancesinto account. Precedence is given to overcoming the situation by integration into the labour market (usingemployment promotion policy instruments) or job-creation schemes with reimbursement of additionalexpenses. If they are not otherwise covered, individuals capable of earning who are between ages 15 and64 and in need of assistance receive Unemployment Benefit II to meet their costs of living (SGB II,Section 19); any individuals in the household who are not capable of earning are entitled to social benefit(Sozialgeld) (SGB II, Section 28). Both types of benefit correspond in amount and structure to assistancetowards living expenses under SGB XII but have to be applied for (SGB II, Section 37). Stipulations madein a Federal Constitutional Court decision of 9 February 2010 have been complied with in legislation onthe determination of standard rates of benefit and amending Book II and Book XII of the Social Code(cited as BGBl. 2011 Teil I Nr. 12 and dated 29 March 2011).In response to the decision, the standard rates for children and adolescents – which determine thestandardised subsistence-level benefit rates – are set directly at different levels according to age group.The rates are no longer defined as a percentage of the former reference rate (now standard rate 1).
Types of social assistanceIn its new form, social assistance covers:Assistance towards living expenses (SGB II, Sections 27-40)Needs-based pension supplement in old age and in the event of reduced earning capacity(Sections 41-46)
- 113 -Assistance towards healthcare (Sections 47-52)Integration assistance for disabled persons (Sections 53-60)Assistance towards nursing care (Sections 61-66),Assistance in overcoming special social difficulties (Sections 67-69)Assistance in other circumstances (Sections 70-74)
Each of these is provided together with advice and support as necessary.
Outline of the sectoral chapters in SGB XII and of the changescompared with the Federal Social Assistance ActChapter 3: Assistance towards living expenses (SGB XII, Sections 27-40)Assistance towards living expenses (Hilfe zum Lebensunterhalt) is mostlyThe former two-way division ofsocial assistance into assistancepaid out to individuals living at home; a cohabiting spouse or civil partnertowards living expenses andand any under-age children living in the same household are deemed part ofassistance in special circum-the recipient’s joint household. Under Section 27 of SGB XII, necessarystances has been replaced by aliving expenses include food, accommodation, clothing, bodycare,division into seven chapters,each covering assistance inhousehold effects, heating, and everyday personal necessities. The latterspecific sets of circumstances.include reasonable expenditure on maintaining contacts with the outsideworld and on taking part in cultural life. This definition shows that over andabove securing a physical subsistence level, social assistance also provides for a minimum humanstandard of living to enable participation in the community.Assistance towards living expenses is paid where possible as a cash benefit. The potential recipient’sneeds are assessed first, and then their income and assets are brought into account (as stipulated inChapter 11 of SGB XII). The needs assessment for assistance towards living expenses is made up asfollows:New standard rates apply from 1 January 2011. The euro amounts as of 1 January 2013 are asfollows:– Standard rate 1:€382:For an adult entitled to assistance running his or her own household as a single person or asingle parent, including if the household is shared with one or more additional adults whocome under standard rate 3.– Standard rate 2:€345:For each of two adults entitled to assistance running a shared household as a marriedcouple, as civil partners or in an equivalent relationship.– Standard rate 3:€306:For an adult entitled to assistance who neither runs his or her own household nor runs ashared household as a spouse, civil partner or in an equivalent relationship.– Standard rate 4:€289:For an adolescent entitled to assistance from 15 to 18 years of age.– Standard rate 5:€255:For a child entitled to assistance from 7 to 14 years of age.– Standard rate 6:€224:For a child entitled to assistance up to six years of age.New education and participation rates for children and adolescents secure them a humanminimum standard of living and participation in the community for school pupils. These rates arerecognised independently of the standard rate so that targeted assistance can be provided forbetter integration of children and adolescents in need into the community.Accommodation in the amount of reasonable rent; if this is found to be ‘unreasonably high’ it ispaid while a move to less expensive accommodation remains impossible or unreasonable(usually up to a maximum of six months) (SGB XII, Section 35).Heating costs in the amount of actual expenses incurred, provided they are reasonable. Costs ofcentrally supplied hot water are paid in the actual amount incurred; a lump sum for hot water is nolonger deducted from the standard rate. If water is heated in the living unit (e.g. by a boiler), theadditional cost is recognised (SGB XII, Section 30 (7).Supplementary assistance is recognised for additional costs not covered by the standard rate incertain situations and special circumstances provided that the individual requirements are met(see box on next page).
- 114 -Certain groups are deemed to needsupplementary assistance (SGB XII, Section 30);these groups are essentially as defined in theFederal Social Assistance Act, except thatadditional assistance is now provided for singleparents. The supplementary assistance isprovided by adding a percentage to the standardrate.Non-recurring assistance is provided for settingup a household, initial outfitting with clothes(including maternity needs) and school outings oftwo days or longer. Assistance is granted as aloan in the case of undeniably necessary specialitems normally covered by the standard rate(SGB XII, Section 37).Health and long-term care insurance can be paid,as can pension contributions (SGB XII, Sections32 and 33).Rent arrears are paid to prevent eviction (SGBXII, Section 34).
Non-recurring assistance is provided for only threepurposes: Setting up a household, initial outfitting withclothes, initial outfitting with maternity and nursing needs,for the purchase and repair of orthopaedic footwear, andrepair and rental of therapy equipment.The flat-rate supplementary assistance is now limited to36% but is based on an increased standard rate thatlargely includes non-recurring assistance. A slightly morefavourable supplementary rate applies for single parents.The end amount for other groups is the same as before.Single parents with a child aged 7 or older now receive asupplement (of 12%).Payment of unreasonably high rent in cases where amove is impossible or unreasonable is limited to sixmonths.Social assistance agencies are allowed to pay a flat ratefor accommodation and heating costs in certaincircumstances.Non-recurring assistance is no longer available for otherundeniably necessary special items normally covered bythe standard rate; such items are now paid for with aloan, repayment of which begins while still in receipt ofassistance towards living expenses.The pocket money for individuals in institutionalaccommodation is currently the minimum permitted rate.The availability of assistance for German citizens livingabroad has been further restricted and is reduced to asmall range of emergency circumstances.
The standard rates and non-recurring assistance are paidon a flat-rate basis. Other assistance towards livingexpenses is generally paid in the amount of the actualcost incurred.
Assistance towards living expenses is also paid in institutional accommodation. Besides furnishings, itthen generally includes clothing and pocket money for personal use; for adults, this is 27% of standardrate 1 (SGB XII, Section 27b).German citizens living abroad cannot receive assistance towards living expenses unless they are in an‘exceptional emergency’ and there are specific reasons preventing their return (SGB XII, Section 24).
Chapter 4: Needs-based pension supplement in old age and in the event ofreduced earning capacity (SGB XII, Sections 41-46a)The new education package (assistance for educationand participation) for pupils attending general educationor vocational schools includes:Costs of one-day school/daycare centre outingsAssistance for multiple-day school tripsAssistance for personal school supplies (€70 for thefirst and€30for the second half of the school year)Costs of pupils’ transportation to/from school, wherenecessary and if not already met from other sourcesAssistance for learning support in specificcircumstancesAdditional costs of communal school mealsMonthly budget of€10for participation in social lifeThe assistance for participation in the social and culturallife of the community naturally also applies on asupplementary basis for people with disabilities, as partof integration assistance.
Under Chapter 4 of SGB XII, all individuals from age 65and individuals from age 18 who have sufferedcomplete loss of earning capacity solely throughmedical causes are entitled to pension supplement ifthey are in need and their normal place of residence isin Germany. The pension supplement is equal inamount to non-institutional assistance towards livingexpenses (Chapter 3); unlike assistance towards livingexpenses, it has to be applied for. The supplement isgenerally granted for a year at a time. Income such as apension and assets belonging to the claimant, to theclaimant’s spouse or civil partner (provided they do notlive separately) or to the claimant’s partner in amarriage-like relationship are taken into account as forsocial assistance, but no recourse is made to childrenor parents who would otherwise be legally required tosupport the claimant if their annual income is under€100,000.
InformationInformation about needs-based pension supplement in old age and in the event of reduced earningcapacity is provided by the social assistance agencies and statutory pension agencies – both for peoplewith pension insurance and on request for all potentially entitled uninsured individuals.
- 115 -Needs-based pension supplement in old age and in the event of reduced earning capacity was introducedas a primary benefit in January 2003 and now forms Chapter 4 of SGB XII. A concession under which norecourse is made to relatives who would otherwise be legally required to support the claimant remains inplace, as does a similar provision in respect of the claimant’s heirs. Also, claimants are not automaticallypresumed to receive help towards living costs from relatives or in-laws living with them in a jointhousehold. Any such help actually received is taken into account as with assistance towards livingexpenses. All other arrangements are as for assistance towards living expenses.
Chapter 5: Assistance towards healthcare (SGB XII, Sections 47-52)Assistance towards healthcare covers the same entitlements as those for statutory health insurance. Thismeans that social assistance recipients without health insurance receive the same health care provisionas those who pay into the statutory health insurance fund. The statutory health insurance funds assumethe costs of medical treatment for non-insured recipients of social assistance and are then reimbursed.Social assistance recipients lacking health insurance choose one of the health insurance fundsauthorised by the assistance provider. The health insurance fund provides social assistance recipientswith health insurance cards to allow them to claim medical treatment as needed. Although they are notstrictly members of the health insurance fund, doctors and other health care providers recognise and treatthem as insured patients.The competent social assistance office reimburses the health insurance fund for the costs of the healthcare services provided under the assistance towards healthcare rules. Equal treatment of non-insuredsocial assistance recipients and insured patients means that social assistance recipients must also paypatients’ contributions towards treatment within their assessed means.
Chapter 6: Integration assistance for disabled persons (SGB XII, Sections 53-60)Integration assistance for people with disabilities is provided for the purposes of prevention, rehabilitationand integration. It aims to avert disabilities or to eliminate or relieve their consequences, and to integratepeople with disabilities into the community (SGB XII, Section 53 (3). Anyone who has or is at risk of alasting physical, mental or psychological disability is entitled to assistance.Essentially the same forms of integration assistance are providedunder SGB XII as were previously available under the FederalSocial Assistance Act and SGB IX. Section 92 of SGB XII limits theextent to which the income and assets of people with disabilities canbe taken into account. In addition to the forms of assistancepreviously available, integration assistance can now also beprovided as part of a cross-agency personal budget.All social assistance recipients withouthealth insurance cover have the sameentitlements as those covered bystatutory health insurance and aretreated accordingly. The costs of theirtreatment are generally assumed by thehealth insurance fund and arereimbursed to the fund by the socialassistance provider.Further progress has been made withthe option of providing integrationassistance for disabled persons as partof a ‘cross-agency personal budget’(SGB XII, Section 57). A personalbudget allows people with disabilities orwho need nursing care to decide forthemselves what assistance to claim,and in what form and from what agencyto claim it.The provisions on assistance towardsnursing care are essentially the sameas they were under the Federal SocialAssistance Act. This is another areawhere assistance can be provided aspart of a cross-agency personal budget.Chapter 8, comprising Sections 67-69of SGB XII, is identical in substance toSection 72 of the Federal SocialAssistance Act, but is differentlystructured.Chapter 9 is identical in substance toSections 15, 27 (2), 67, 70, 71 and 75of the Federal Social Assistance Act.
Chapter 7: Assistance towards nursing care (SGBXII, Sections 61-66)Social assistance also supports people in need of nursing care bypaying part or all of the costs of care.The introduction of long-term care insurance (SGB XI) significantlyreduced the burden of social assistance for nursing care. The newprimary, insurance-based system has provided home care, part-time institutional care and short-term care benefits since April 1995and institutional care benefits since July 1996.Since the introduction of long-term care insurance, social assistancehas mainly been responsible for people who do not meet thecriterion of having ‘considerable’ need of care (Level I care underSection 15 of SGB XI), for cases of cost-intensive (extreme) carewhere long-term care insurance benefits are insufficient due to theirupper limit, for meeting accommodation, food and investment costsfor people in institutional care, and for people not covered by long-term care insurance.
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Chapter 8: Assistance in overcoming special social difficulties (SGB XII, Sections67-69)Assistance in overcoming special social difficulties is intended for people in exceptionally adversecircumstances with attendant social difficulties. This primarily includes people affected by homelessnessand associated problems.
Chapter 9: Assistance in other circumstances (SGB XII, Sections 70-74)Chapter 9 covers various forms of assistance: assistance with household upkeep (SGB XII, Section 70),assistance for the elderly (Section 71), assistance for the blind (Section 72), funeral expenses (Section74) and, as a catch-all provision, assistance in circumstances not otherwise provided for (Section 73).
Other provisionsThe remaining parts of SGB XII contain:Chapter 10: Facilities and services (SGB XII, Sections 75-81)Chapter 11: Accounting for income and assets; assignment of maintenance claims (SGB XII,Sections 82-96)Chapter 12: Responsibilities (SGB XII, Sections 97-101)Chapter 13: Repayment of costs of assistance; transfer charging between agencies (SGB XII,Sections 102-115)Chapter 14: Rules of procedure (SGB XII, Sections 116-120)Chapter 15: Statistics (SGB XII, Sections 121-129)Chapter 16: Transitional and final provisions
Information on the income deduction rulesEntitled individuals can retain 30% of their earnings from employment, where any employment isassumed under SGB XII to be for less than three hours a day since individuals capable of working morethan this would come under SGB II, basic security benefits for job-seekers (although people withdisabilities working in sheltered workshops are, as before, allowed to keep earnings equalling 12.5% ofstandard rate 1 plus 25% of their pay in excess of this amount).Employment promotion benefit under SGB IX, Section 43, sentence 4 is now exempt from deduction fromany form of social assistance and not solely from institutional integration assistance.With regard to assistance under Chapters 5-9, SGB XII stipulates an income limit equal to 200% ofstandard rate 1 plus 70% of standard rate 1 for additional family members and accommodation costs.If adults with disabilities or in need of nursing care have a claim to maintenance, the claim is automaticallyassigned (with limited exceptions) to the social assistance agency at a flat rate of up to€31.07a monthfor integration assistance for people with disabilities and assistance towards nursing care, and up to€23.90a month for assistance towards living expenses. As a rule, no recourse is made to relatives whowould otherwise be legally required to provide maintenance in respect of needs-based pensionsupplement in old age and in the event of reduced earning capacity.Some 23,408,512 people in pilot regions around the country can now use the 115 hotline to contact theirlocal authorities and welfare services. Depending on the reason for their call, they may be transferred toanother office, be it at local, regional or national level.Reasons to dial 115Find out what social assistance is available in your areaWho your point of contact isIf other types of help and support are available
The 115 hotline is open Monday to Friday from 8 am to 6pm.More and more regions will join the system as the program develops. A list of all 115 regions is availableat www.d115.de (updated daily).
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Housing benefitWohngeldGood housing is expensive – too expensive for some people. This is why there ishousing benefit (Wohngeld), an allowance that the state grants to help cover the cost ofhousing.Tenants as well as homeowners can receive housing benefit if their rent or mortgagepayments exceed their financial means. It does not matter whether your home is old ornew, or whether it was built with the help of government subsidies or tax concessions orwas entirely privately financed.Housing benefit is called rent support (Mietzuschuss) when it is granted to tenants, andmortgage and home upkeep support (Lastenzuschuss) when granted to homeowners.
Housing benefit increase on 1 January 2009A housing benefit reform entered into force on 1 January 2009 and brought significant benefit-relatedimprovements. One new provision takes account of rising energy prices and makes heating costs anintegral component of housing benefit. The heating portion of the benefit is calculated based on a fixedincremental amount relative to the size of the household and is added to the gross rent excluding utilitycosts.Housing benefit has also been increased: the maximum amount of rent support and of mortgage andhome upkeep support has been increased to match that for newly built homes and then increased againby 10 percent. The tabular values increased by 8 percent, and a non-recurring supplement was paid tohouseholds which received housing benefit for at least one month during the period October 2008 toMarch 2009.
Benefits and conditionsRent support is available to people who:Rent a flat or a roomSub-rent a flat or a roomOwn a flat in a co-operative or a housing trustHave been granted a right of use or a permanent dwelling right equivalent to a tenancyOwn a multi-unit dwelling (with three or more flats), provided they also live in itLive in a home they ownMortgage and home upkeep support is available to people who own:A one or two-family house which they live in but is used primarily as a place of business or is partof a full-time farming operationAn owner-occupied house or flatA heritable right to build,A permanent dwelling right equivalent to ownershipA claim to be transferred title in a building or dwelling, or a claim to be transferred or granted aheritable right to build provided they live in the accommodation in question
Non-entitlement to housing benefitHousing benefit is not granted to recipients of:Unemployment Benefit II and social benefit (Sozialgeld) under Book Two of the Social Code(SGB II)Assistance provided under Section 22 (7) of SGB IITransitional allowance equal in amount to unemployment benefit II under the first sentence ofSection 21 (4) of SGB XI
- 118 -Injury benefit equal in amount to unemployment benefit II under Section 47 (2) of SGB VIINeeds-based pension supplement in old age and in the event of reduced earning capacity underSGB XIIAssistance towards living expenses under SGB XIISupplementary assistance towards living expenses and other assistance in a facility under theFederal War Victims Relief Act (Bundesversorgungsgesetz) or other legislation under which thatact appliesAssistance in special cases and basic assistance under the Asylum Seekers Assistance Act(Asylbewerberleistungsgesetz)Assistance under SGB VIII in households consisting solely of recipients of such assistanceand their dependants taken into consideration in its assessment where the costs of accommodation areincludedApplications for housing benefit may not be refused in cases where its provision would prevent or removethe need for social assistance and one of the above-mentioned benefits has either not been or will not beprovided but ranks below the provision of housing benefit.
Legal entitlementHousing benefit is not a form of government charity. Anyone who is able to claim housing benefit is alsolegally entitled.
Eligibility criteriaSeveral factors determine whether you receive housing benefit and the amount you receive. Theyinclude:The number of family members in your household (these include the person entitled to housingbenefit, spouse, civil partner, partner in another relationship of shared responsibility, parents,children – including adopted and foster children – brothers and sisters, uncles, aunts, brother-in-law and sister-in-law)The amount of rent or mortgage payment that qualifies for support. However, a ceiling applies tothe amount of rent or mortgage payments that can be taken into account depending on thenumber of members of your household eligible for consideration and the official table of maximumrents.Total family income
Calculation of total incomeHousing benefit is based on annual income as defined under taxation law. This means taxable incomewithin the meaning of Section 2 (1) and (2) of the German Income Tax Act (Einkommensteuergesetz). Acatalogue of tax-exempted incomes is also used in the calculation.The total income figure is the sum total annual income of all family members belonging to the household,minus certain deductions and exempt amounts. Applicants must provide proof of the income figures theystate.The annual income stated in an application is the amount that applicants expect to earn while receivingbenefit.
Housing Benefit and Income CeilingsNumber of members ofthe household12345Monthly total income limits in euros in accordance with the housing benefitformula in communities covered by the official table of maximum rentsIIIIIIIVVVI780790800820840860105010701100112011401170131013401350138014101430171017501780181018501880198020102040208021102150
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What you have to doMake an applicationTo receive housing benefit, you have to submit an application to the competent local authority housingbenefit office and produce proof of eligibility.
The entitlement periodHousing benefit is usually granted for 12 months at a time. It may however run for a shorter or longerperiod. When you decide to apply, please remember that, at the earliest, housing benefit is paidbeginning with the month your application is received.Should you continue to need housing benefit after your entitlement period has ended, you will have toreapply. If possible, you should submit your application two months in advance to avoid a possibleinterruption in payments.
The lawThe underlying legislation can be found in the Housing Benefits Act as supplemented by the HousingBenefits Ordinance.
InformationStaff at the local housing benefit office have a legal duty to advise you on your rightsand obligations under the Housing Benefit Act.More detailed information about housing benefit law is available online on the FederalMinistry of Transport, Building and Urban Affairs website(http://www.bmvbs.de/en/dokumente/-,1872.962035/Artikel/dokument.htm).
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International social securityInternationale SozialversicherungAccording to German social security law, benefits are to be provided in many cases onlyin Germany. But our lives are becoming increasingly international. Today, millions ofpeople work in other countries or visit them as tourists. And this trend makes itimportant for social benefits to be paid across borders or provided in other countries.Which is why the European Union (Austria, Belgium, Bulgaria, Cyprus, the CzechRepublic, Denmark, Estonia, Germany, Greece, Finland, France, Hungary, Ireland,Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal,Romania, Slovakia, Slovenia, Spain, Sweden, and the UK) has a legal framework thatenables payment of benefits to entitled persons across borders and ensures that theyand their families have, for example, necessary health care in all EU member states.The agreement on the European Economic Area (EEA) extended this legal frameworkto include Norway, Iceland and Liechtenstein. It also applies in Switzerland.Similar agreements have been concluded with a number of countries with which Germany has signedsocial security agreements. These include:AustraliaBosnia-HerzegovinaBrazil (pensions only)Canada (pensions only)Chile (pensions only)China (secondment)CroatiaIndia (secondment)IsraelJapan (pensions only)MacedoniaMontenegroMoroccoSerbiaSouth Korea (pensions only)TunisiaTurkeyUSA (pensions only)
The social insurance agreements with China and India cover the avoidance of double contributionpayments when an employee from one country works in the other.None of these agreements is concerned with harmonising security systems. Their emphasis is oncoordination.
GeneralThe European Union provisions and some of the social security agreements are very comprehensive.The most important provisions involve benefits provided in the event of illness, invalidity and old age, andthose granted to surviving dependants and to people who have suffered an industrial accident oroccupational illness.
- 121 -The international agreements are based on two assumptions:1. That all persons covered by them enjoy the same status regarding their rights in social welfare matters.2. That residence in one EU country or contracting state can generally be accorded equal status withresidence in another EU member country or contracting state.Important: The international agreements cover not only compulsory insurance but voluntary insuranceunder the applicable terms as well. The EU provisions apply to you for example if you are or have beeninsured in accordance with the regulations of one or more EU member states. You must also be a citizenof an EU member state, a third-country national, a stateless person or a refugee, and you must live in anEU member state.Bilateral agreements (those with non-EU states) apply primarily to:German nationalsNationals of the other contracting stateRefugeesStateless persons
The lawRegulation (EC) No 883/2004 provides the basis for social security coverage within the European Union,the European Economic Area (EEC) and Switzerland. The above listed social security agreements applyelsewhere.
Health insuranceBenefits and conditionsIf you have moved to another EU country or a contracting state to work, you will have health insurancecoverage there as well and receive any necessary benefits from the appropriate funds.You are also entitled as a tourist in any EU member state to medical treatment that cannot be postponeduntil your planned return. If you go to an EU member state to obtain medical treatment, your Germanhealth insurance is required to refund your expenses up to the amount you would have incurred for thesame treatment in Germany. In the case of hospital treatment, the prior consent of your health insuranceis required. This does not apply in Australia, Canada, Chile, China, India, Israel, Japan, Morocco, SouthKorea or the USA.If you are a foreign national and work in Germany while your family is living in, say, Turkey, your familywill enjoy full health insurance coverage in Turkey as well, just as if you were employed there.
What you have to doIf you plan to travel abroad as a tourist, you should take a European Health Insurance Card (EHIC) fromyour health insurance fund with you. If you are going to Bosnia-Herzegovina, Montenegro, Serbia, Turkeyor Tunisia, you should obtain a special claim certificate (Anspruchsbescheinigung). This is also acceptedoutside the EU in Croatia and Macedonia.This certificate also lists whom you must contact where you are travelling should you require healthinsurance benefits.If your employer sends you to work in another country, you will continue to be insured in your own countryand pay your contributions there. In such cases, you should take a relocation certificate(Entsendebescheinigung) with you. It entitles you to claim benefits in the other country and protects youagainst having to pay insurance there as well.Under a decision of the European Court of Justice, long-term care insurance must be paid out to Germanpolicyholders and their co-insured family members in all EU and European Economic Area states andSwitzerland.
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InformationAdvice and information is provided by your health insurance fund and by GVK-Spitzenverband, DeutscheVerbindungsstelle, Krankenversicherung-Ausland (DVKA) (the German liaison office for health insuranceabroad), Postfach 200 464, 53134 Bonn.
Occupational accident insuranceBenefits and conditionsTake the following example: You are a German national and have been working in France for a Frenchcompany and are now returning to Germany after having suffered an accident at work. Your Frenchinsurance fund will pay a disability pension to you in Germany. You will also be entitled to receive themedical treatment you need in either country.If you were to have a fatal accident while working abroad, the insurance fund in that country would pay apension to your surviving dependants, even if they live in Germany.
What you have to doIf you want to apply for benefits, you should contact your insurance fund in Germany or, if you are abroad,the foreign insurance fund in the country you are in.
InformationInformation and advice is provided by the Deutsche Gesetzliche Unfallversicherung (DGUV) (GermanStatutory Accident Insurance), Alte Heerstrasse 111, 53757 Sankt Augustin, Germany.
Pension insuranceBenefits and conditionsIf you have worked in various EU member states or contracting states duringthe course of your working life, the respective periods during which you werecovered by pension insurance will be added together and applied toward yourqualifying period. If you qualify for a pension, it will be paid to you even if youlive in another EU member state or contracting state. As a rule, each insurancefund will pay a part of the pension proportionate to the periods during whichyou were insured with it. Survivors’ pensions are paid on the same basis.
What you have to doIf you live abroad and are amember of a Germaninsurance fund, you willcontinue to pay yourcontributions as usual.Should you require benefits,you should apply to theinsurance fund in the countrywhere you live. You can alsoreceive benefits from abroadby applying to the fund in therespective country or to theGerman fund.
InformationInformation and advice regarding EU and EEA member states are provided by the following:Deutsche Rentenversicherung Bund (www.deutsche-rentenversicherung-bund.de)Deutsche Rentenversicherung Knappschaft-Bahn-See, (www.deutsche-rentenversicherung-knappschaft-bahn-see.de)And by Deutsche Rentenversicherung's regional agencies:For Greece, Cyprus, Liechtenstein and Switzerland; Baden-Württemberg (www.deutsche-rentenversicherung-bw.de)For Poland; Berlin Brandenburg (www.deutsche-rentenversicherung-berlin-brandenburg.de)For Japan and South Korea; Braunschweig-Hannover (www.deutsche-rentenversicherung-braunschweig-hannover.de)For Hungary and Bulgaria; Mitteldeutschland (www.deutsche-rentenversicherung-mitteldeutschland.de)For Slovakia, Slovenia, the Czech Republic, Bosnia-Herzegovina, Croatia, Macedonia, Serbia,Montenegro, Kosovo; Bayern-Süd (www.deutsche-rentenversicherung-bayernsued.de)
- 123 -For Denmark, Estonia, Finland, Great Britain, Ireland, Latvia, Lithuania, Norway, Sweden, China,Canada and the USA; Nord (www.deutsche-rentenversicherung-nord.de)For Austria; Bayern-Süd (www.deutsche-rentenversicherung-bayernsued.de)For Portugal, Romania and Turkey; Nordbayern (www.deutsche-rentenversicherung-nordbayern.de)For Australia; Oldenburg-Bremen (www.deutsche-rentenversicherung-oldenburg-bremen.de)For Belgium, Spain, Chile and Israel; Rheinland (www.deutsche-rentenversicherung-rheinland.de)For France and Luxembourg; Rheinland-Pfalz (www.deutsche-rentenversicherung-rheinland-pfalz.de)For Italy, Malta, Morocco and Tunisia; Schwaben (www.deutsche-rentenversicherung-schwaben.de)For the Netherlands and Iceland; Westfalen (www.deutsche-rentenversicherung-westfalen.de)
Child benefitBenefits and conditionsIf you are unconditionally required to pay tax or are gainfully employed in Germany, you can receive childbenefit (Kindergeld) for children living in certain other countries. Child benefit is paid in full for childrenliving in other EU states, in Liechtenstein, Switzerland, Norway and Iceland. Agreed rates are paid forchildren living in other countries, such as Turkey.If you work in one of these countries but weren’t sent there by your German employer, you will normallyreceive family allowance (child benefit) according to the provisions that apply in the country where youwork.
What you have to doSubmit an application for benefits to your local family benefits department (Familienkasse) or to youremployer if it is a public body. If you have a foreign claim, you should contact the competent foreignagency. Further information is available in special leaflets.
InformationInformation and advice are provided by the local family benefits department (Familienkasse).
Unemployment insuranceBenefits and conditionsIf you are unemployed and move to another EU country or to Norway, Iceland, Liechtenstein orSwitzerland in order to seek employment there, you may continue to receive German unemploymentbenefits under certain circumstances for a maximum period of three or at the outside six months. Yourpayments continue in Germany if you return there within this period. If you are unemployed, werepreviously employed in Germany and are now in Bosnia-Herzegovina, Croatia, Serbia, Montenegro orMacedonia, in certain circumstances you can receive benefits from that country’s insurance fund.
What you have to doInformationYou must fulfil the following requirements in order to continue receivingGerman unemployment benefits after moving to another EU state: Beforeyour departure, you must have been registered with the German employmentservices as an unemployed person and have been available for work for atleast four weeks after becoming unemployed. You are also required toregister as a job seeker with the employment services in the EU memberstate you have moved to within seven days of your arrival.Information and advice areprovided by your localemployment office(Arbeitsamt)and byFederal EmploymentServices(Bundesanstalt fürArbeit)in Nuremberg.
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The social courtsSozialgerichtsbarkeitSocial security and legal protection by the social courts go hand in hand. The socialcourts ensure that anyone can have their rights under social welfare law reviewed andenforced through the courts.
Jurisdiction of the social courtsThe social courts mostly judge disputes involving social insurance matters. These include healthinsurance, occupational accident insurance and pension insurance, and also unemployment insurance,social compensation law with the exception of compensation and assistance for war victims, and the lawrelating to severe disabilities. Since 1 January 2005, the social courts have also been the courts ofresponsible jurisdiction for disputes about basic security benefits for job-seekers (‘Hartz IV’ benefits) andsocial assistance.
Organisation of the social courtsThe social courts are organised in three levels. The social courts of first instance are known asSozialgerichte. Länder social courts (Landessozialgerichte) – one for each of the sixteen German states –adjudicate in the second instance. The final instance is the Federal Social Court (Bundessozialgericht).Each first-instance social court has a number of chambers, each dealing with specific areas of law withinthe social court jurisdiction. A chamber comprises a professional presiding judge and two lay assistantjudges. The Länder social courts take appeals against decisions of the first-instance social courts. Theirsenates – corresponding to the chambers at the first-instance courts – comprise a presiding judge, twoadditional professional judges and two lay judges. The senates of the Federal Social Court, whichdecides appeals on points of law, likewise consist of a presiding judge, two additional professional judgesand two lay judges.The lay judges have the same rights and duties as the professional judges. Lay judges appointed tosocial court chambers and senates are selected for their particular experience as practitioners in theapplicable area of law.
Filing a complaintComplaints must be filed with the court in writing or dictated into the record. ‘Dictated into the record’means that complainant files a complaint by describing the matter at dispute to the clerk of the court, whoputs the complaint in writing. The complaint must name the complainant and the respondent. It must alsostate the remedy sought. The complaint should state the social assistance agency or public authoritydecision notice, if any, that it is directed against; the notice should be filed with the complaint. Facts andevidence supporting the complaint must also be given.Complaints must be filed with the first-instance social court of local jurisdiction for the complainant’s placeof domicile at the time.Before filing for reversal of an administrative decision or for the granting of a refused administrativedecision, complainants must generally first lodge an administrative appeal against the decision or refusalwith the competent authority or social assistance agency. Such appeals must be lodged in writing with ornotified for documentation to the office that issued the decision or refusal, within one month of its issue.The authority or social assistance agency then reviews the lawfulness and expediency of the decision orrefusal in an administrative appeal procedure. If an authority or agency finds an administrative appeal tobe justified, it reverses the disputed decision and if applicable grants the decision sought. If not, theauthority or agency responsible for taking the administrative appeal issues a notice rejecting it andaffirming the decision or rejection. In this event, a complaint can be filed with a social court.There is a time limit for bringing complaints: A complaint must be filed with the competent social courtwithin one month of the notice rejecting the administrative appeal.
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Court proceedingsSocial court proceedings generally include one oral hearing. In advance of the oral hearing, the presidingjudge can request papers, electronic documents and health records. The presiding judge can alsorequest information, hear witnesses, including expert witnesses, commission written opinions from expertwitnesses, summons others to appear at the hearing, and discuss the matter in person at a meeting withthe parties so that the dispute can be dealt with if possible in a single hearing. The oral hearing is publicand is chaired by the presiding judge. The latter first announces the case, after which instructions aregiven to any witnesses who have been summonsed. The witnesses then leave the courtroom until theyare heard. The presiding judge next presents the facts and the dispute as they stand. Any evidence isthen taken and heard as necessary, and the complainant and respondent state their case. Once thedispute has been heard, the presiding judge declares the oral hearing closed.Taking and hearing evidence is a very important part of social court proceedings. It consists of hearingwitnesses, including expert witnesses such as doctors, and review of documents submitted in support ofspecific factual claims. The court is not restricted to evidence submitted by the parties to a case, becausesocial court proceedings are governed by the principle that the court must investigate the matter on itsown initiative. It must determine all facts material to deciding a case. The parties can be called in to assistin this process.Parties to social court proceedings can be represented by someone who has their power of attorney. Thisis only absolutely necessary before the Federal Social Court, however, and is not a requirement for first-instance and Länder social courts. Such representation might be provided by a lawyer, or a member oremployee of a union or employer’s association.Court proceedings normally end with a decision. This is usually announced at the session in which theoral hearing is held and brought to conclusion.
Judicial review of social court decisionsTwo types of appeal are possible: an appeal on the merits of the case (Berufung) and an appeal on apoint of law (Revision). An appeal on the merits can in principle be lodged against any decision of a first-instance social court; an exception is where the amount at dispute is less than€750,for which an appealon the merits can only be lodged if the first-instance court expressly gives leave to appeal. The amount atdispute is the difference between what the appellant received in the proceedings before the first-instancesocial court and what he or she seeks on appeal. In an appeal on the merits, the competent Länder socialcourt reviews all factual and legal aspects of the case.A decision handed down by a Länder social court can be contested by an appeal to the Federal SocialCourt on a point of law. Unlike an appeal on the merits, an appeal can only be taken to the Federal SocialCourt if the Länder social court expressly gives leave to appeal. Leave must be granted first and foremostif the issue is of fundamental significance – for example because it is one on which the Federal SocialCourt has not yet handed down a decision or it affects the public interest – or if the Länder court decisionis at variance with a decision of the federal court. If a Länder social court denies leave to appeal, acomplaint can be filed against the denial. In an appeal on a point of law, the Federal Social Court doesnot review the factual aspects of a case, focusing instead on the legal point at issue.An appeal on the merits of the case or an appeal on a point of law must be filed within one month of thedecision being served.
Cost of social court proceedingsProceedings before the social courts are free of charge to insured persons in the statutory insurancesystem, except in cases involving exceptionally long court proceedings. Complainants not in any of thesegroups – for example social assistance agencies – must pay a flat-rate fee. If neither the claimant nor therespondent is in any of the three exempt groups, court fees are levied according to the amount at disputeas with other types of court.
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Social security data protectionSozialdatenschutz
Principles of social security data protectionGuaranteeing social welfare rights through social security systems unavoidably entails thehandling ofpersonal data (social security data)on the citizens concerned. However, the collection, processing anduse of often highly sensitive personal data, for example on people’s health conditions, must generally beregarded as aninfringement of the individual’s constitutional right of informational self-determination.In view of this, particularly strict rules apply.The constitutional requirement for laws safeguarding social security data as a class of personal data inparticular need of protectionhas been met with the provisions onsocial security confidentiality inSection 35 of Book I of the Social Code (‘SGB I’), social security data protection (SGB X, Chapter2, Sections 67-85a) and supplementary data protection provisionsin other parts of the social code.Under these provisions, it iseveryone’s right that social security data pertaining to them are notcollected, processed or used by social welfare agencies without authorisation (social securityconfidentiality).The rules on social security confidentiality and social security data protection applywhether the Social Code is implemented by federal or by Länder authorities.Social security dataare individual items of information about the person oreffects of a specific or identifiable individual that are collected, processed or usedby, for example, a social welfare provider in the performance of its duties underthe Social Code.Business and trade secretsare equivalent to social securitydata before the law. Special rules apply in some cases for particularly sensitivepersonal data such as health data.Collection, processing and use of social security data is only lawful if there isstatutory authorisation allowing it or if the individual concerned gives their consent(prohibitedsubject to consent).The law must, therefore, define the type ofpersonal data that may be collated, stored and transferred by social securityproviders. Also, in the collation of personal data, the principle applies whereby thedata may only be collected, processed and used if the responsible agencyneedsthem to fulfil its duties. These are usually a social assistance provider, such as apension insurance fund or a health insurance fund. For example, health insurancefunds many only collect personal data if they are needed to determine anindividual’s insurance status and membership of the fund. Key data include theperson’s name, address, family status and employment status. The data may onlybe processed and used for the purpose for which it is collected (the principle ofpurpose).The provisions regarding social security secrecy and data protection and privacyapply independent of the prevailing national or Länder (state) Social Code.
Examples(1) An employers’ liabilityfund provides a pensionfund with information on aninjury pension so that thepension fund can assesswhether, and if applicablein what amount, it isallowed to deduct pensionbenefits under SGB VI,Section 93.(2) If a benefits agency isplanning to prosecutesomeone for benefit fraudor for withholding andembezzling wages, it isallowed to pass on socialsecurity data to the lawenforcement authorities.The same would apply, forexample, for a healthinsurance fund takingaction to collect unpaidcontributions, becausesuch measures aredeemed appropriate forupholding paymentdiscipline.
Communication of dataCommunication of social security datais a particular form of data use and is only lawful with theconsentof the individual concerned or if there isstatutory authorisationto communicate the data underthe Social Code. In the statutory definition, communication means making social security data stored oracquired by data processing known to a third party by way of the data being passed on to the third partyor the third party viewing or retrieving data made available for viewing or retrieval.Common circumstances in which data are communicated:Communication of specific enumerated data such as name or address for the work of the police,public prosecutors, etc.Communication for the performance of social welfare responsibilitiesCommunication for occupational health and safety purposesCommunication for the performance of special statutory responsibilities and notification powersCommunication of social security data for research and planning
- 127 -Communication to supranational and international agencies abroad
Communication for the performance of social welfare responsibilitiesis particularly important inpractice.Rights of the affected individualProtection of social security data provides for a range of individual rights. If an individual believes thattheir rights have been breached in the collection, processing and use of their social security data, theymay appeal to the Federal Commissioner for Data Protection (Bundesbeauftragten für den Datenschutz)or the responsible agency as defined by Länder (state) law (usually the regional commissioner for dataprotection). Also, Book X of the Social Code provides information-related opportunities for affectedindividuals: for example, they are entitled to have erroneous social security data corrected.
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Publisher’s informationPublished by:Federal Ministry of Labour and Social AffairsReferat Information, Publikation, Redaktion53107 BonnGermanyInformation as of January 2013
Ordering service:Order no.:Phone:Fax:Postaladdress:A 998+ 49 (0) 30 18 272 272 1+ 49 (0) 30 18 10 272 272 1Publikationsversand der BundesregierungPostfach 48100918132 RostockGermany[email protected]http://www.bmas.de
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