Unemployment Benefits in Germany

Unemployment benefit is an income replacement benefit paid in accordance with Book Three of the Social Code. Unemployment benefit is an insurance benefit financed from the contributions that are paid into unemployment insurance.

Unemployment benefit is a service provided by a contingency insurance. The amount that is disbursed is not therefore calculated according to the duration or the total of contributions paid for employment promotion, but according to the contingency risk. The contingency risk is the loss of wages caused by the loss of employment. The function of unemployment benefit is to secure subsistence in place of the lost earnings.

According to existing law, the amount of the unemployment benefit is therefore 67% of the gross work earnings, reduced by standardised deductions for an unemployed individual with one child in terms of tax law or 60% for other unemployed persons.

The entitlement to unemployment benefits is, among other things, subject to the requirement that the qualifing period has been fullfilled. To comply with this requirement, the insured person must have been employed subject to compulory insurance for twelve months within the last two years prior to registration as unemployed (the so-called framework period).

The maximum duration of entitlement to unemployment benefit is generally twelve months, 15 for employees over the age of 50, up to 18 for employees over the age of 55 and up to 24 months for employees over the age of 58. The duration of entitlement to unemployment benefit depends on the duration of the compulsory insurance relationship within the framework period extended by three years and on the age reached by the unemployed person upon onset of entitlement:

Compulsory insurance contributions made in the last five years prior to registration as unemployed (months) Age Maximum duration of entitlement (months)
12 6
16 8
20 10
24 12
30 50 15
36 55 18
48 58 24

As from 1 August 2009, persons with predominantly brief temporary employment periods can, under certain conditions, receive facilitated access to the unemployment insurance benefit. Such facilitated access is particularly contingent on

the days employed within the framework period consisting predominantly of jobs subject to obligatory insurance, which are limited in time to no more than ten weeks, and

the work earnings in the last twelve months not exceeding the reference amount under section 18 subs. 1 of Book Four of the Social Code (SGB IV) (2013: EUR 2,695 per month or EUR 32,340.00 annually; If all other prerequisites are met, a shorter qualifying period  of six month applies. This regulation will expire on 31. December 2014.

If this qualifying period is fulfilled, there is an entitlement to unemployment benefit irrespective of age:

For compulsory insurance relationship with a duration of a total of at least…month month
6 3
8 4
10 5