When a German company temporarily runs out of work, it can put employees on Kurzarbeit (short-time work). The Federal Employment Agency then pays Kurzarbeitergeld (KUG) — Germany's short-time work benefit — to replace part of the lost income. Our short-time work calculator shows your exact KUG amount, net income loss, and the effect of any employer top-up.
What is Kurzarbeitergeld?
Kurzarbeitergeld is a wage replacement benefit under §§ 95–111 SGB III (Social Security Code). It applies when employees work reduced hours — or not at all (Kurzarbeit Null) — due to economic reasons or unavoidable events. The goal is to avoid redundancies and protect jobs.
For an employer to claim KUG, at least 10 % of the workforce must be affected by a loss of earnings exceeding 10 %, and the short-time work must be registered with the local employment agency.
How is Kurzarbeitergeld calculated?
The benefit is based on the net pay difference under §133 SGB III:
Net pay difference = Target net pay (full-time) − Actual net pay (short-time)
The benefit rates applied to this difference are:
- 60 % of the net pay difference — no children (standard rate)
- 67 % of the net pay difference — at least one child (enhanced rate, §32 EStG)
Example: €3,500 gross, tax class I, 50 % reduction
Assumptions: tax class I, no children, 50 % working time reduction.
| Category | Amount |
|---|---|
| Full-time gross | €3,500 |
| Full-time net (target pay) | approx. €2,290 |
| Short-time gross (50 %) | €1,750 |
| Short-time net (actual pay) | approx. €1,360 |
| Net pay difference | approx. €930 |
| KUG (60 %) | approx. €558 |
| Total net with KUG | approx. €1,918 |
| Net income loss | approx. €372 (−16 %) |
Calculate your exact figures with the short-time work calculator.
Effect of tax class
The tax class affects the net salary on both sides of the equation — full-time and short-time — and therefore changes the net pay difference and the resulting KUG. Employees in tax class III (e.g. sole earners) have a higher net income, which shifts both the difference and the benefit amount.
KUG itself is tax-free (§3 No. 2 EStG), but subject to progression clause (Progressionsvorbehalt): it raises the applicable tax rate on other income. This can lead to a tax bill when filing your annual return.
Employer top-up (Aufstockung)
Many employers voluntarily top up KUG — typically to 80 % or 90 % of the employee's normal net salary. Top-ups are free of social security contributions up to 80 % of the lost pay and are taxable income for the employer.
Use our short-time work calculator to model the top-up and see exactly how much you would receive in total.
Duration of benefits
The standard maximum duration is 12 months. In exceptional circumstances — such as an economic crisis or pandemic — this can be extended by regulation to up to 24 months, as happened during the COVID-19 pandemic.
Kurzarbeit Null (zero-hours short-time work)
When employees work zero hours, the entire full-time net pay becomes the net pay difference. KUG then equals 60 % (or 67 %) of the full-time net — the maximum possible benefit.
Social security during short-time work
Employers must continue paying social security contributions on 80 % of the lost pay — at least the employer share. Under certain conditions (e.g. when employees attend training), these contributions may be reimbursed by the employment agency.
Don't forget your tax return
Anyone who received KUG is required to file an income tax return (§46 para. 2 no. 1 EStG). The progression clause increases the tax rate on remaining income. The gross-net calculator helps you estimate net pay under different conditions.
Related calculators
- Short-Time Work Calculator — KUG, net loss and employer top-up
- Gross-Net Calculator — net salary across tax classes
- Emergency Fund Calculator — safety net for income shortfalls
- Citizens Income Calculator — benefit after long-term unemployment