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Note that this article is only relevant for you if your company is located in Germany.

Short time allowance in Personio Payroll

Short time work is aTemporary reduction of working hours in the company, combined with a corresponding reduction in remuneration. The goal is to cushion temporary economic difficulties – for example due to declines in orders or production – with the help of short-time work allowance.

Requirements for short time allowance (§ 95 SGB III):

  • Significant loss of work with loss of earnings
  • Personal eligibility requirements are met
  • Company eligibility requirements are met
  • The loss of work is reported to the Employment Agency

Further general information on short time work can be foundin our article on theme.

Company Settings

Before you begin

If your organization short time allowance (KUG) has been applied for, please first contact our Payroll Support. This will first set up the necessary attributes in the employee profile for you.

You can then take the following steps to file short-time allowance for your organization at both company and permanent establishment level.

Store KUG in the company settings

Learn about settings 

To store short time work for your organization, you need the following information, which you must insert as fields in the settings:

Field in settings Description and notes
KUG approval period – start date The effective date for KUG is stored in this field. As a rule, this is the 1st of the month from the approval period.
KUG approval period – end date In this field, the end date for KUG is stored. KUG is granted for a maximum of 12. Exceptions can be made by the Federal Government.
Affected part of the company

In this case, the affected part of the company is stored as free text.

Example: Production, Administration

If you do not make these settings, no short-time equivalents are stored in the payroll account. Please note that it is no longer possible to create a new payroll account retroactively after the payslip has been released. 

Note:
The Federal Government can extend the period of entitlement to up to 24 months by ordinance. This extension is currently in effect until 31 December 2025.

 

Store information

To activate the settings for short time work for your organization, proceed as follows: 

  1. Go to the section payroll.
  2. Choose the correct one legal entityfor which short time work is to apply.
  3. Switch to the tab Managing > Social Security.
  4. Activate the switch Short time work registeredat the company and business premises level.
  5. Enter the necessary information as described in the section above.
  6. Set an effective date and save the changes.

Employee attributes 

One-time information 

About KUG attributes

You must store the following attributes for each employee once per short-time reference period:

Attribute Input Description and notes
Receives Kurzarbeitergeld Yes / No If "Yes" is made as the selection, further information must be provided for the short-time limit calculation. If the field is empty or the selection "No" is selected, no short-time allowance will be billed for the employee. 
Application for benefits: KUG number

For instance:

K12345678 or TK-1234567

 The number is assigned by the Federal Employment Agency.
Application for benefits: Loss of work number

For instance:

AA-1234

 The loss of work number is a unique identifier issued by the Employment Agency for each specific loss of work in the context of short time work.
start date short time allowance TT. MM.YYYY As a rule, this is the 1st of the month from the approval period.
End date of short time allowance TT. MM.YYYY In this field, the end date for KUG is stored. KUG is granted for a maximum of 12. Exceptions can be made by the Federal Government.

 

Store information

To enter the general information on short-time equivalents for the employee concerned, proceed as follows:

  1. Go to the relevant employee profile.
  2. Switch to the tab Information. 
  3. Go to the section short time work (KUG) and click Edit.
  4. Enter the necessary information once per short-time reference period, as described in the section above.
  5. Set an effective date and save the changes.

For more information about editing attributes, see in our article on theme.

Monthly data 

You must customize the following attributes monthly. Read in the section above, how to do this:

Attribute Input Description and Note
Target hours XXX.XX

The monthly target hours that the employee would have worked without short time work. 

 

Calculation of salary earners:

Weekly working hours * 13 weeks / 3 months
Lost hours XX.XX

The total monthly hours in which working hours were lost due to short-time work. 

All hours are listed here, including:

  • KUG + Krank
  • KUG + illness without continued payment of wages
  • KUG + Holiday
Sick without continued payment of wages (in hours) XX.XX

The monthly hours in which the employee is ill during short time work. 

 

Requirement: 

  • The disease has before receiving KUG begun.
  • The employee includes sickness benefit, paid by the employer in the amount of KUG for the period of illness.
Sick (in hours) XX.XX

The monthly hours in which the employee is ill during short time work. 

 

Prerequisite: 

  • The disease has during the receipt of KUG begun.
  • The employee receives KUG for the period of illness.
Holidays (in hours) XX.XX The monthly hours on which KUG and a public holiday took place at the same time. 
Actual hours worked XX.XX The hours actually worked each month (excluding, for example, unpaid leave).
Employer subsidy KUG (€) XX.XX

If an employer's contribution to KUG is paid, the full amount must be entered here. 

Personio automatically calculates the SV-free and compulsory share. 
Performance Rate Group 1 or 2

Performance rate 1 = 67 %

Performance rate 2 = 60 %


The benefit rate 1 is calculated automatically on the basis of the entered child allowance. 

The attribute only needs to be filled if a different service rate is to be used. 

 

Example:
 

  • Employees with a child within the meaning of tax law
  • Tax class 5 and zero child allowance 

→ In this case, benefit rate 1 must be deposited. 
Additional income from other employers during short-time work (€) XXXX.XX

With this attribute, a distinction must be made between two scenarios:

  1. Has already been before the start of short time workcarried out a secondary activity, this attribute must be not can be filled.
  2. Became during the receipt of KUG is an increase in the remuneration actually earned. In this case, the gross remuneration from the secondary activity must be entered. 
Contribution reduction during short-time saving time limit - start date DD/MM/YYYY

Voluntarily insured persons can apply for a reduction in contributions while receiving short-time allowances. 

As soon as a confirmation from the health insurance company is available, the start date of the exemption must be entered in the attribute. 

 

Example:
A organization is registering short time work with the Employment Agency on August 1. Working hours are to be reduced by 50% per day for the affected employees.  The following information is available for the employee:
 

  • The employee who works in Berlin has no children within the meaning of tax law (= benefit rate 2).
  • His monthly earnings amount to € 3,500.00 for 40 hours per week.
  • His daily working hours are reduced from 8 to 4 hours.
  • The month of August has a total of 21 working days.
  • In August, he was unable to work for 3 working days and was ill with a entitlement to continued payment of wages.

The following values must be stored in the employee profile

Attribute Wert
Receives short time work  yes
Application for benefits: KUG number  K12345678
Application for benefits: Loss of work number AA-1234
start date short time allowance 01.08.2025
End date of short time allowance 31.07.2026
Target hours

173,33

(= 40 weekly working hours * 13 weeks / 3 months)
Lost hours

84

(= 21 working days * 4 hours)
Sick (in hours) 12,00
Actual hours worked

89,33

(= 173.33 target hours - 84 lost hours)

 

Special features for hourly workers

In the case of hourly wage-earners, in the Salary tabthe hours that would actually have been worked without the loss of short time work are deposited for the full month. This involves the following steps:

  1. Go to the relevant employee profile.
  2. Switch to the tab Salary. 
  3. In the column base salary to the current month.
  4. Enter the hours and confirm your entry.

Please note:
This entry overwrites all entries in the Attendance tab for that period, including holidays. 

Alternatively, you can also enter the target hours in the Attendance tab for the individual days.  Then enter the data on short-time work in the Information tab,as described above. 

Special features in the event of incapacity for work due to illness

In the event of incapacity for work due to illness during short time work, further information must be provided under Additional information during the time off. In order for these fields to be visible, the attribute Receives short time work on Yes . This involves the following steps:

  1. Go to the relevant employee profile.
  2. Switch to the tab time off. 
  3. Open the time off you want to edit and click on the pencils icon in the top right.
  4. Under Additional informationyou can now enter further information on time off and short time work. 
  5. Save your changes.

Inability to work due to illness and short time work full-time

Requirement: The employee would have had100% short time allowance (KUG) receive.

Procedure:

  • The time off is entered in the tab time off for the entire day of illness.
  • Subsequently, under Additional information in the field "In the case of short time work: On which days during the illness would the employee have received the full short time allowance?", the days on which short time work and illness coincide.
  • The data is displayed in the format YYYY-MM-DD Deposited. Example: 2025-08-31,2025-09-01
  • You will then need to enter the sick hours in the employee profile under Information, depending on the case in the following attributesdeposit:
    • Sick without continued payment of wages (in hours) or
    • Sick (in hours)

 

Incapacity for work due to illness and short time work prorated per day

Prerequisite: On the day of illness, the employee would only haveprorated short time allowance (KUG) oriented.

Procedure:

  • The time off is entered in the tab time off for the entire day of illness.
  • Subsequently, under Additional information in the field "On which days and for how many hours is the employee prorated in short time work during the time off?", the days on which short time work and illness coincide must be entered.
  • The data is displayed in the format YYYY-MM-DD:HR Deposited. Example: 2025-08-31:4,2025-09-01:4
  • You must then enter the sick hours in the employee profile under Information, depending on the case in the following attributes:
    • Sick without continued payment of wages (in hours) or
    • Sick (in hours)

Documents in Personio Payroll 

Remuneration certificate

On the Remuneration certificate the KUG remuneration is all shown in gross. Personio uses the following types of wages: 

Salary type Description
57540 short time allowance

With this type of wage, the hours and the short-time allowance amount are shown on the remuneration certificate. The certificate only contains values that refer to the short time allowance (KUG). Excluded from this are the following information from the attributes of the employee profile:

  • Sick (in hours)
  • Public holiday (in hours)
57550 short time allowance sick This wage type includes the values from the "Sick (in hours)" attribute in the employee profile. Both the number of hours and the corresponding amount are shown on the salary statement.
57577 short time allowance public holiday Here, the hours and amount are taken from the employee profile based on the "Holiday (in hours)" attribute.

57565 Employer's subsidy KUG, subject to social security

57560 Employer Subsidy KUG

 If an employer subsidy is paid, it is taken from the attribute employer subsidy KUG (€) from the employee profile and broken down accordingly in accordance with the legal requirements as a sv-free or sv-obligatory remuneration.

Payroll account

In payroll account, the relevant payroll data for short time allowance (KUG) is presented in a separate section. This information can be used to complete the evaluation for the application for the KUG reimbursement.

health insurance accounting report

In the document Social health insurance accounting report the current amounts and the KUG fictitious salary are shown separately. The notional wage is calculated as 80% of the difference between the unrounded gross target and actual remuneration. The entire contributions from the fictitious salary are borne by the employer.

contribution statement to the Employment Agency

KUG Settlement Lists

After you have successfully approved the payroll run, the next step is toKUG Settlement List for the Employment Agency. You will need the following documents:

  • Employee's payroll account
  • Employee's salary certificate 
  • KUG and default number for your organization
  • Company number of your company

When filling out the payroll list, do the following:

Please note that the content of our website (including any legal information) is intended solely for the purpose of providing non-binding information and does not constitute legal advice in the true sense of the term. The content of this information cannot and should not replace individual and binding legal advice that addresses your specific situation. In this respect, all information is provided without guarantee of correctness, completeness or of being up to date.

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