News in times of Corona
AFTER THE CRISIS IS BEFORE THE CRISIS
Are you "Corona-damaged"?
The corona crisis presents us with enormous and unprecedented challenges in almost all areas of daily life.
Here you can not only feel the burden of fear of infection, but also the political measures weigh heavily on German households and companies.
Labor law in the corona crisis:
Have you lost your job due to Corona about rules of conduct during quarantine, or is your employer on short-time work or even bankruptcy for the same reason?
In principle, the following applies: If a company in the form of a GmbH, UG or AG is in financial difficulties or is overindebted, the managing director is obliged to file for insolvency within 3 weeks. In times of Corona and the resulting lockdowns, this puts companies under enormous financial pressure. Many insolvency administrators are therefore of the opinion that a real wave of bankruptcies could threaten.
The federal government has therefore reacted and introduced some changes to insolvency law through the COVInsAG, which came into force on March 27, 2020:
Prerequisites for the suspension of the obligation to file for insolvency according to § 15a InsO are now according to § 1 COVInsAG:
Consequences of the suspension of the obligation to file for insolvency:
Further state aid in the Corona crisis is:
Despite Corona, we are there for you by phone or email!
In urgent cases, we also offer personal meetings - of course subject to strict hygiene measures!
Are you "Corona-damaged"?
The corona crisis presents us with enormous and unprecedented challenges in almost all areas of daily life.
Here you can not only feel the burden of fear of infection, but also the political measures weigh heavily on German households and companies.
Employers register short-time work, the net income of families falls and the house blessing hangs wrong at home because the children are not allowed to go to school / daycare and are not allowed to meet their friends. In addition, parents are currently suffering from severe financial pressure or even existential fears.
Here are some tips in special areas:
Have you lost your job due to Corona about rules of conduct during quarantine, or is your employer on short-time work or even bankruptcy for the same reason?
As a lawyer well versed in both insolvency and labor law, I will be happy to advise you comprehensively, both in and out of court!
Here I give you a brief overview of the most important questions as an employee:
- Stay at home if you are afraid of Corona: If an employee stays away from work because he is afraid of being infected with the corona virus, this can result in a warning or even termination. Because this constitutes a refusal to work. The employee is only entitled to refuse performance if the exercise of his activity is associated with an objectively significant risk to health and life. A mere risk of infection is not enough.
- Continued payment of wages in quarantine: If an official quarantine or observation has been ordered for an employee and he is able to work in the home office due to his health condition and the available work equipment, then he is even obliged to do so due to his contractual fiduciary duty. If, on the other hand, the employee is unable to do so, or if the authority has even imposed a ban on professional activity, the employer is usually obliged to continue paying wages for up to 6 weeks in the amount of the earnings. The employer has the opportunity to apply for a reimbursement from the health authorities. From the seventh week onwards, the employee is entitled to loss of earnings under the Infection Protection Act against the health authorities in the amount of sick pay.
- Order of home work by the employer: Whether the employer provides the employee with a home office and thus permits home work depends on the respective company. If the company has not made any statements on this, in case of doubt the place of work agreed in the employment contract applies, i.e. usually the company. If the employee stays in the home office without authorization, this can result in a warning or even termination of the employment relationship. Within the scope of his right to issue instructions, the employer can order home work, provided that the prerequisites for this are in place. If necessary, he is even obliged to do so due to his duty of care towards the employee.
- Temporary closure: If the employer is unable to employ his employees due to failing supply chains or official measures, they are released from their duty to work, while the employer remains obliged to continue to pay the wages due to his operational risk according to § 615 sentence 3 BGB to pay.
- Short-time work allowance: Under the conditions of § 96 SGB III, namely that there is a significant temporary loss of work for economic reasons or due to an unavoidable event and this is unavoidable, the Federal Employment Agency pays short-time work allowance. In the short term, the legislature made it easier for companies to access short-time work benefits. NEW is that it is currently sufficient when 10% of employees are affected by a gross monthly salary drop of at least 10% (otherwise a third). In that case, any social security contributions for lost working hours will be covered by the employment agency. Another new feature is that temporary workers can also take short-time work and receive short-time allowance. The loss of working hours must be unavoidable and temporary for the company in accordance with Sections 95 to 99 of SGB II and must be reported to the Employment Agency in writing. You can find the corresponding form under the following link: https://www.arbeitsagentur.de/daten/beispiel-kug101_ba013134.pdf. The short-time work allowance is 60% of the lump-sum net loss of earnings in the relevant calendar month, 67% for at least 1 child in the household. The maximum subscription period is now from 12 to 24 months. >>> NEWS <<<: On April 23rd, 2020 the grand coalition agreed to gradually increase the short-time allowance. The increase in short-time allowance is made dependent on the length of the compulsory break and on the fact that at least 50 percent of the regular working hours are absent. From the 4th month, 70 or 77 percent (parents), from the 7th month 80 or 87 percent of the loss of wages would be paid.
- No short-time allowance for mini-jobs: Since short-time work benefits are benefits from unemployment insurance and these are not used by mini-jobbers, they cannot receive short-time work benefits.
- Effects on company pension schemes: If a company is on short-time work, this initially has no influence on the agreement on deferred compensation, it remains in effect. As before, the employer pays the converted remuneration components to the insurance company and pays the corresponding legally binding subsidy. Only when the work is reduced to zero as part of short-time work is no longer paid by the employer to the insurance company, since the short-time work benefit is a wage replacement benefit from unemployment insurance. In the case of a purely employer-financed company pension, the further payment depends on whether the benefit is linked to the amount of the remuneration. If necessary, only a correspondingly reduced employer contribution is paid. If the employer's contribution is independent of the amount of the wage, the employer is usually obliged to continue paying even if the workload is reduced to zero. If there is no such obligation, the employer can make the insurance contribution-free. In addition to the employer, the employee can also exempt the insurance himself, but this usually results in a reduction in the later pension benefit. Another option would be deferment of contributions. In this case, there is no reduction in benefits, as the contributions must be paid in one amount at the end of the deferral period.
- Business trips to risk areas: Provided that the employer carefully weighs up the operational issues and the interests of the employee, he may in principle, on the basis of his right to issue instructions, order business trips to risk areas, whereby it must be said that the employee's health is very important. In general, however, the employee cannot refuse the business trip. If he refuses despite justified instructions, he can receive a warning or even notice. The only exception applies to official travel warnings from the Federal Foreign Office: in this case, the employee is entitled to oppose the business trip. Then he does not have to fear sanctions under labor law. If the employee is already on a business trip in a risk area, the employer must observe the situation in the affected area, in particular possible travel warnings, due to his contractual duty of care. This applies all the more if the employee is generally active in the risk area. If necessary, cooperation with the Federal Foreign Office and home work may be required. If this is not possible, the employee must be fetched back from the affected area. Overall, the individual case assessment is based on the extent to which the area is affected and any previous illnesses of the employee.
- Ordering overtime and interruption of vacation due to the corona crisis:
If some colleagues have already contracted the virus or if there are staff shortages for other reasons, the employer may order overtime (within the legal working hours). However, the employee only has to break off a vacation if there is work that cannot be postponed and which can only be carried out by him. Here, too, the employer must carefully consider the decision and may only bring the employee back from vacation if it is absolutely necessary and unavoidable.
Family law in the corona crisis:
It's sad, but families in particular have to suffer from the spatial and sometimes also financial pressure of the Corona crisis!
If you have any problems within the family, please do not hesitate to contact us! We advise you on domestic violence, maintenance and handling during the Corona crisis. In the event of domestic violence, our victim protection page is also of interest to you.
All problems that arise in connection with separation and divorce can be discussed by telephone first, even without personal contact.
If applications to the court are necessary, you can fill out the necessary forms etc. at home. After consultation, we will send you the relevant forms and then forward them to the responsible family court.
Should you not be able to afford the costs, we are also happy to act on the basis of advice or legal aid. Please contact us if necessary!
Insolvency law in the corona crisis:
In principle, the following applies: If a company in the form of a GmbH, UG or AG is in financial difficulties or is overindebted, the managing director is obliged to file for insolvency within 3 weeks. In times of Corona and the resulting lockdowns, this puts companies under enormous financial pressure. Many insolvency administrators are therefore of the opinion that a real wave of bankruptcies could threaten.
The federal government has therefore reacted and introduced some changes to insolvency law through the COVInsAG, which came into force on March 27, 2020:
- The regulation on the registration obligation of the managing director was modified and the application obligation for GmbH and UG was suspended until 30.09.2020.
- The manager's liability for payments despite the bankruptcy has been relaxed.
- The insolvency administrator's rights of contestation have been adjusted and extensive financial aid has been made available for corona-damaged companies.
Prerequisites for the suspension of the obligation to file for insolvency according to § 15a InsO are now according to § 1 COVInsAG:
- Insolvency or over-indebtedness is the result of the corona pandemic. Here, a presumption in favor of the company applies that this is assumed if the company was not insolvent on December 31, 2019.
- There must be a prospect that an existing insolvency will be eliminated. Important note: If the debtor is a natural person, the delay in opening insolvency proceedings in the period between March 1, 2020 and September 30, 2020 cannot be based on a refusal to discharge the remaining debt!
Consequences of the suspension of the obligation to file for insolvency:
- Relaxation of the manager's liability: Payments made by a bankrupt company within the suspension period in the ordinary course of business, in particular those that serve to maintain or resume business operations or implement a reorganization concept, are deemed to be payments made with the care of a prudent and conscientious manager, i.e. such payments may not have to be made be repaid by the managing director to the company.
- Privilege of lenders: Repayments of new loans granted during the suspension period and the provision of collateral for such a loan are not deemed to be disadvantageous to creditors due to Section 2 COVInsAG until September 30, 2023 and are not to be seen as an immoral contribution to the delay in bankruptcy. Potential lenders should be encouraged to grant loans despite the Corona crisis. Until 09/30/2023 you do not have to fear that a corresponding repayment may be contested by other creditors due to creditors' disadvantage or immoral procrastination of bankruptcy.
- Limitation of avoidance of creditors: Payments during the suspension period, which have made it possible for a creditor of the company to secure or satisfy, or the granting of payment facilities, the shortening of payment terms, etc., cannot be challenged in later insolvency proceedings. In accordance with Section 2 (1) No. 4 COVInsAG, this does not apply if the creditor is in bad faith with regard to the company's inability to reorganize.
- Restriction of creditor insolvency applications, § 3 COVInsAG:
In the case of creditor insolvency applications between March 28th, 2020 and June 28th, 2020, the opening of the procedure requires that the reason for the opening already existed on March 1st, 2020.
Further state aid in the Corona crisis is:
- Financial assistance from Kfw Bank: A company or start-up that threatens to become insolvent due to the Corona crisis can apply for financial assistance from Kfw-Bank (Kreditanstant für Wiederaufbau) in the form of loans or guarantees. The application is made via the company's main bank or via the federal state development banks. Especially for startups (companies that have not been on the market for more than 5 years) Kfw provides an ERP loan for start-ups. You can find the corresponding link here: https://www.kfw.de/inlandsfoerderung/Unternehmen/Gr%C3%BCnden-Nachhaben/F%C3%B6rderprodukte/ERP-Gr%C3%BCnderkredit-Universell-(073_074_075_076)/
- Tax and social security relief: You can apply to the responsible tax office for income and corporate tax prepayments to be adjusted to any income in 2020. For this, however, the company must be able to prove that sales losses have occurred due to Corona or are imminent. There is also the option of applying for an interest-free technical deferral. An application is made that the sales tax liability is deferred without interest until the expected income tax refund has been assessed. This also applies to deferral of social security contributions. The application must be submitted to the relevant health insurance company. >>> NEWS <<<: Furthermore, on April 23, 2020, the grand coalition agreed on tax relief for small and medium-sized companies in the form of allowing them to offset foreseeable losses this year with advance tax payments from 2019. They receive reimbursements from tax offices, which creates liquidity. According to current law, losses can only be claimed in the next year.
- Short-time work allowance: In the short term, the legislature made it easier for companies to access short-time work benefits. It is currently sufficient if 10% of the employees are affected by a monthly wage drop of at least 10% gross. In that case, any social security contributions for lost working hours will be covered by the employment agency. Another new feature is that temporary workers can also take short-time work and receive short-time allowance. The loss of working hours must be unavoidable and temporary for the company in accordance with Sections 95 to 99 of SGB II and must be reported to the Employment Agency in writing. You can find the corresponding form under the following link: https://www.arbeitsagentur.de/daten/beispiel-kug101_ba013134.pdf. The short-time work allowance is 60% of the lump-sum net loss of earnings in the relevant calendar month, 67% for at least 1 child in the household. The maximum subscription period is now from 12 to 24 months. >>> NEWS <<<: On April 23rd, 2020 the grand coalition agreed to gradually increase the short-time allowance. The increase in short-time allowance is made dependent on the length of the compulsory break and on the fact that at least 50 percent of the regular working hours are absent. From the 4th month, 70 or 77 percent (parents), from the 7th month 80 or 87 percent of the loss of wages would be paid.
- Direct grants for solo self-employed and small businesses:
Even self-employed individuals and small businesses, which suffer severe losses in sales due to the Corona crisis, should be given immediate help to bridge € 9,000.00 (self-employed individuals and companies with up to 5 employees) or € 15,000.00 for small businesses be equipped with up to 10 employees. These grants do not have to be repaid. The prerequisite, however, is that the self-employed person works full-time, that the company was not in financial difficulties before March 2020, the damage occurred after March 11, 2020 and that the loss of sales occurred due to the Corona crisis. The subsidies also apply to farmers and farms with agricultural production. In addition, the direct help can be applied for in an extremely uncomplicated and unbureaucratic manner. Applications can still be submitted until May 31, 2020. You can find more about direct assistance here: https://www.bundesregierung.de/breg-de/themen/coronavirus/info-unternehmen-selbstaendige-1735010 >>> NEWS <<<: Tax assistance for the gastronomy: Another new feature from April 23rd. 2020 is the agreement of the grand coalition to lower the VAT for food in the catering trade from 19 to 7% from 07/01/2020 to 06/30/2021.