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Fake e-mails about immediate Corona aid are circulating – NBank is not the sender

E-mails are being sent in the name of NBank that demand repayment of excess subsidies paid out as part of the immediate Corona aid program from the State of Lower Saxony and Germany’s federal government. In Lower Saxony, the sender’s address is There are two documents are attached to the e-mail named: “Rechtsbelehrung_Zuschussempfänger” and “Bescheinigung_Finanzamt”.

NBank is not the sender of these e-mails. This approach is also appearing in other German federal states, such as NRW, Saxony-Anhalt, Hamburg, Baden–Württemberg, Bavaria and Thuringia.

NBank is working closely with the State Criminal Police in Lower and the Central Criminal Office in Hanover. Do not open such e-mails under any circumstances. Instead, file charges with the police immediately. In addition, do not contact or answer this e-mail address.

Safely through the corona crisis

Safely through the corona crisis: What you should definitely pay attention to as a business owner now, dated 16/03/2020 (PDF)


Dear Sir, Dear Madam, 

Following ebola virus, avian flu and SARS, the corona epidemic is now coming. Having initially infected vast numbers of people in China, the SARS-CoV-2 virus has now reached Germany, too.  

Most of the borders have already been closed, movie theaters, discos and bars have had to close; public life has been shut down. The economic repercussions are already being felt clearly. But the area of labor and tax law is also massively affected. As an employer, how should you deal with infected employees? How can you respond to frightened employees and how far do your managerial prerogatives go with respect to business trips and home office rules? What do you have to observe if you resort to short-time working or order overtime and what tax assistance can you expect from the German government?  

This client information provides you with important answers to these and other questions. It does not just have “corona-specific” information. You can draw upon this information if similar crises occur in future, too. 


1. Rights and duties of the employee 

The rights of the employee that are important for you here largely pertain to the matter of the continued receipt of pay. In this context, it depends crucially on the individual case.

1.1 Own illness 

If an employee falls ill to COVID-19, this is a case of unfitness for work. The employee has an entitlement to the continued receipt of pay for a period of six weeks (Section 3 Para. 1 of the German Continuation of Remuneration Act).

Note: In accordance with R 3.11 Para. 2 of the income tax guidelines, subsidies are tax free in cases of illness or death or assistance in special emergencies to employees of corporations, institutions or public foundations due to state aid regulations (principles governing state aid) or assistance regulations (principles governing assistance) from the federal or state governments or due to corresponding rules.


1.2 Illness of a relative 

If the child of an employee is ill or requires care, Section 616 of the German Civil Code (BGB) envisages a continued receipt of pay in the event of a temporary incapacity.  

Note: Section 616 of the German Civil Code (BGB) does not define a specific period as a temporary incapacity. In a ruling by the Federal Labor Court, up to five working days can be regarded as reasonable. 

However, if you have excluded application of this standard in the contract of employment, this entitlement does not exist. If employees have a suspected Covid-19 infection or there is an illness in their immediate environment, you must observe your duty of care and tell these colleagues to get tested in order to prevent a further spread of the virus.


1.3 No childcare facilities 

If kindergartens and schools are closed due to cases of infection or to prevent a spread of pathogens, employees may not have childcare alternatives available and may be forced to remain at home.  

In these cases too, there is an entitlement to continued receipt of pay in accordance with Section 616 of Germany’s Civil Code (BGB) for a reasonably short period of time until a childcare alternative can be found. The specific number of days has to be decided on a case-by-case basis. If it a longer period of time, the employees affected must either take vacation or make use of existing time credits.


1.4 Quarantine ordered 

Quarantine measures ordered by the authorities can affect the residential location of your employees or even the site of your business. In these cases, you must continue to pay the employee’s remuneration for six weeks - even if your employee is not ill. However, you have an entitlement to reimbursement from the authorities that ordered the quarantine which is equivalent to the level of continued remuneration. You can assert this claim in accordance with Section 56 of the German Law on the Prevention of Infection (IfSG).  

The corresponding application, however, must be submitted within three months of the employee stopping work or after the isolation ends. Once employees no longer continue to receive pay, they can apply for regular sick pay.


1.5 Home office 

Due to fears of infection, there may be increased requests from employees for permission to work from home. In Germany, however, there is no right to demand employers to set up a home office workplace. For this reason, you can refuse these requests from your employees to set up such workplaces.  If employees refuse to come to work because of fears that they may become infected in the business, this is regarded as a refusal to work. This would give you grounds for a labor law suit and which can ultimately end in dismissal.


1.6 Getting to work 

If your employees are reliant upon public transport and there are interruptions in this service, they are not excused from their duty to work as a result. They bear the so-called travel risk and they must endeavor to arrive for work on time. If this is impossible for them, they can lose their entitlement to remuneration for the time they are missing.


1.7 Business trips and field work 

Many firms are reliant upon field work. This refers to employees visiting client sites rather than working on the company’s own premises, for instance. Since contact with other persons represents a risk of infection, there have now been cases in which employees have refused to perform field work. 

Note: If employees’ employment contracts also include an agreement to perform field work, you can demand this service from them. Refusal to do so by employees can have labor law consequences, for example, a warning can be issued.

Refusal to take a business trip somewhere is justified if the German Foreign Office has issued a corresponding travel warning. Employees’ fear of infection alone does not represent sufficient reason for a refusal. 

Note: If you or one of your employees has to take a business trip abroad, you should keep up to date with the travel warnings published on the website of the German Foreign Office: <br/>


2 Quarantine of the business 

The responsible health care authorities can also place your business under quarantine as a precautionary measure if this appears necessary. This can be the case if a corresponding hazard emanates from your business. 

Example: You have a hotel business where there have been an increasing number of Corona cases. The responsible health care authorities can place the business under quarantine and close the hotel. 

Should this occur, consult with the authorities to clarify your obligations. 

Note: Violations of quarantine regulations can even be sanctioned with up to five years’ imprisonment or fines in accordance with Section 74 of the German Law on the Prevention of Infection (IfSG). 

The quarantine measures can also be imposed forcibly. For instance, if you refuse to close your business, the health care authorities can alternatively enforce its closure - if necessary with the assistance of the police. If property is destroyed, damaged, or its value impaired in some other way by the authorities in connection with this action, you can claim for compensation (Section 65 Para. 1 of the German Law on the Prevention of Infection (IfSG). Exceptions to this are such items that were with infected with pathogens or that were suspected of being so.


Remuneration entitlements of your employees 

If your business is placed under quarantine by order of the public authorities, the employees are still entitled to remuneration. This risk therefore lies within your area of responsibility. 

Note: If it makes sense operationally, you can reach an agreement with your staff for them to continue to work from home, as long as the conditions allow for this. 

It is therefore advisable to check now which areas are suitable for home office arrangements. You should also take account of the technical requirements, especially with regard to IT security and data protection.


3 Precautionary measures 

Within the remit of your duty of care as the employer, you are responsible for taking suitable precautionary measures in your business to prevent the spread of pathogens, such as the corona virus SARS-CoV-2. For example, you can issue general hygiene instructions at the workplace, provide disinfectant, and prohibit bodily contact (e.g. shaking hands). 

You can take further precautionary measures within the framework of organizational proceedings, for instance, by substituting business trips with phone or video conferences, in as far as this is possible. This also includes the setting up of home office workplaces referred to above.  

In order to avoid large gatherings, for example in the works canteen, you can also set guidelines that specify when social amenities can be used.  

Note: When it comes to preventative measures, allow yourself to be guided by the recommendations of the health care authorities and those of the Robert Koch Institute

If your company has a works council, these measures will also require its approval.  Consult with the works council to agree a common approach to prevent a further spread of the disease. Often the works council has a closer relationship with the workforce. 

Whether you can impose the above measures unilaterally within the scope of your managerial prerogatives is debatable. For example, unless they themselves are infected, employees are not obliged to wear a face mask.  

Note: In principle, there is no right to information as to whether your employees are infected with corona virus or indeed as to where they spent their vacation. 

In general, it is advisable to act with moderation and mutual consideration. If your employees would like to wear a face mask, you should not prohibit this.


4 Eemployment opportunities for employees 

Pathogens, such as SARS-CoV-2, can have massive repercussions for the work opportunities of employees. Either they lack work or there is too much - meaning that working times of employees either have to be shortened or extended. 

Note: In principle, the operational risk lies within your area of responsibility. This means that wages still have to be paid even if there is no work. And then again, you have to hire enough staff if there is a great deal of work to do.


4.1 Ordering short-time working arrangements 

Due to SARS-CoV-2, order volumes are down in many sectors of industry, not just in exhibition stand construction. If you no longer have enough work, you may be forced to register for short-time working. Short-time working means that the employer is not forced to dismiss the employees affected immediately. 

Note: Even the shortening of working hours is subject to co-determination and you will have to consult the works council. 

If your company does not have a works council, you are still not permitted to order short-time working unilaterally. In this case, you must reach agreements with the employees affected. 

Note: It can also be that you have to order short-time working for a particular unit of the company because this area is especially affected by the corona crisis. 

The option of short-time working is sometimes already provided for in the employment contract. It should be ensured that this clause envisages a notice period, as an introduction of short-time working without prior notice can disadvantage employees unreasonably. If your firm is party to an industry collective agreement, this collective agreement can also provide for corresponding options. 

If the economic situation in your firm is so dramatic that you have to order short-time working, you must tell the German Federal Employment Agency in writing. As part of this announcement, you must report the reasons why short-time working is necessary. If you have a works council, it too must be involved in the application. 

I in the course of short-time working, employees no longer have to offer their services and, as the employer, you are exempted from the payment of remuneration. In return, the employees affected then have an entitlement to short-time working benefit. 

Note: As the employer, you have statutory obligations of co-operation in this regard. Providing incorrect information can lead to fines.


4.2 Latest news about short-time working 

In response to the spread of SARS-CoV-2, the German government has decided to make changes to short-time working benefit, which should be passed by the German parliament (Bundestag) by early April and they will initially apply until the end of 2020.  

Specifically, the new law provides for the following measures: 

Should orders fail to materialize due to adverse economic developments, a business can register for short-time working in future if at least ten percent of the workforce are affected by the loss of work. Up to now, this threshold stood at 30 percent of the workforce. 

The build-up of negative flextime hours before the payment of short-time working benefit should be dispensed with either in full or in part. The applicable law demands that for businesses in which flextime agreements are used, these arrangements should also be employed to avoid short-time working by accruing negative hours. Temporary staff will also still be able to draw short-time working benefit in future. 

Social insurance contributions, which you as the employer normally have to pay on the behalf of your employees, shall be completely refunded by the German Federal Employment Agency in future. This is intended to create an incentive to utilize the period of short-time working to improve the training of the employees. 

The level of short-time working benefit is geared towards the previous level of remuneration. The employment authorities distinguish between employees that have a child allowance of at least 0.5 noted on their income tax card and other employees. 

Employees with a child allowance receive 67 % of the difference in net pay. All others receive a rate of 60 %. 

Example: An employee (1 child) in full-time employment receives gross remuneration of € 3,000,<br/> which corresponds to about € 1,900 net. The working hours are cut by 50 %, which means that the gross income is € 1,500  (roughly € 1,100 net). The net remuneration difference is therefore € 800. The employee receives 67 % of this € 800 (= € 536).

In this example, the employee therefore only receives € 264 less in net terms.


4.3 Ordering overtime arrangements 

As a result of the likely higher rates of sickness and absence due to quarantine, it may be necessary for employees in the business to work longer hours. In this case, you can order overtime arrangements to the extent that these are provided for in employment contracts.  

Note: If corresponding provisions are missing, overtime can only be ordered if there is the threat of serious economic harm. 

If your firm has a works council, the ordering of overtime is subject to co-determination. This means that you cannot order overtime arrangements without the agreement of the works council. If you cannot come to an agreement with the works council, you can apply for the establishment of a conciliation committee, which can serve as a substitute for the missing agreement.


4.4 Redundancies 

If the ordering of short-time working alone is no longer sufficient, in the worst case redundancies can be pronounced. This is then a case of redundancies for operational reasons and means that the selection of the employees to be made redundant must take account of social-welfare aspects. 

In accordance with Germany’s Employment Protection Act, these social-welfare aspects are: Period of employment, age, maintenance obligations and severe disability. If your firm has a works council, you have to inform it in the event of pending redundancies.


5 Tax law outlook 

Pandemics not only present major challenges in terms of health care, but also in a legal context. The severity of the economic and therefore fiscal repercussions resulting from the SARS-CoV-2 pandemic will only become clear in the coming weeks and months.  

The German government responded on 13 March 2020 with a package of measures for affected companies and employees. Besides the adjustment of the short-time working rules, there are to be liquidity assistance tax breaks for corporations in place by early April. In detail, these are as follows: 

  • Deferment of tax payments 
  • Reduction of advance payments 
  • Waiving of enforcement action (e.g. account garnishment) or late payment fines until 31 December 2020 

In addition, for duties that are administered by the customs authorities (e.g. energy tax and aviation tax), the General Directorate of Customs was instructed to accommodate taxable persons in corresponding ways. The same applies to the Federal Central Tax Office (BZSt), which is to adopt a similar procedure for insurance tax and VAT. 

Moreover, firms and employees are to be supported via the expansion of existing programs for liquidity assistance should they through no fault of their own register declines in revenue due to the corona crisis.  

Note: The measures adopted by the German government are unlimited in volume and also include the KfW’s Corporate Loan, the ERP’s Universal Start-up Loan and the KfW’s Loan for Growth. 

In addition, KfW is to set up further special programs. These are registered with the EU Commission for approval. We will keep you up to date with future tax law developments. 

If the (financial) situation of your firm changes as a result of the SARS-CoV-2 pandemic or other acute epidemics, please contact us at anytime. In the event of questions pertaining to labor law, always also contact your legal advisor if you have any doubts.  


*All information provided to the best of our knowledge, but no liability assumed. This information is no substitute for individual advice! Legal status: 16 March 2020  

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