Unemployment benefit 2 (ALG II) - Working-in-Germany
 
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Unemployment > Unemployment Benefit II



Unemployment Benefit 2 (ALG II)

Definition, Explanation

The unemployment benefit 2 (ALG / Arbeitslosengeld 2 / II), which is sometimes referred to by the term “Hartz IV” imprecisely, is one benefit among those in the “basic security for jobseekers”. Unlike the unemployment benefit 1 which is financed by money from the unemployment insurance, the unemployment benefit 2 as well as the social money are financed by money from tax deductions. This is regulated in the social code, precisely SGB II.

The unemployment benefit 2 amount granted depends on the need of the recipient, unlike the unemployment benefit 1 which depends on the net wage. The unemployment benefit 2 is meant to enable receivers to maintain a living. In most of the cases, the institution from which all the money comes is the ARGE or the municipality, in some cases an applicant has to turn to both the federal labour agency and the municipality to apply for the different components of the benefit.

Component benefits paid by the labour agency, respectively the ARGE:

  • regular benefits for daily needs, that is food, garment, body care, household furniture and fixtures, household energy, participation in cultural life
  • additional demands, e.g. for pregnancy and birth or additional costs in case of special nutrition required
  • compulsory contributions to pension-, health- and nursing insurance
  • temporary additional benefits bridging from unemployment benefit 1 to 2
  • employment promotion measurements, e.g. counselling, placement services, further education, assigning of personal contact person / case manager

Component benefits paid by the municipality:

  • accommodation (rent) and heating expenses
  • child care benefits
  • debt counselling and addiction counselling
  • psychosocial assistance
  • one-time demands such as first equipment with garment and furniture, benefits for school trips of several days

Entitled receiver of unemployment benefit 2 is who fulfils the following requirements:

  • at least at age 15, and below age 65
  • capable of being employed (“employment-capable”), meaning that your state of health allows for working at least 3 hours per day
  • in need of support, meaning that you cannot maintain a living for you and your family by your own income and assets
  • you are residing within Germany

Foreigners receive unemployment benefit 2 after a 3-months stay in Germany, if the above requirements are fulfilled and they are entitled to be employed in Germany which is formally documented by the “Aufenthaltstitel” (residence title for specific purposes). Also a person who is counted a member a household-unit in need can receive unemployment benefit 2.

Not entitled are

  • persons who receive an old-age pension
  • persons living “in-patient” in a care institution e.g. penitentiary
  • sick persons having to stay in a hospital for longer than 6 months
  • apprentices
  • students

Amounts of monthly regular benefit (2012):

  • for singles, lone parents / lone custody takers, persons with a partner aged below 18: 100 % of the standard amount, that is € 374
  • for couples and married couples: €337 each partner
  • for children before their 6 birthday: € 215 per child
  • for children from their 6th until their 14th birthday: € 251
  • for children from their 14th until their 18th birthdy: € 287

The above amounts are further adjusted depending on the household-unit in need and depending on income and assets. There are pro-rata cuts on the unemployment benefit 2 amount if the receiver is

  • receiving child allowance
  • paid side-line job remuneration
  • in possession of assets above the threshold amount

The benefits from unemployment benefit 2 is normally transferred to the receiver's bank giro account. After 6 months a check is done on whether the conditions for entitlement are still fulfilled.

There are no taxes deducted from received unemployment benefit 2 and other benefits out of the basic security for jobseekers. Furthermore, those benefits cannot legally be distrained.

Vacation:

As a receiver of unemployment benefit 2 you are not entitled to take vacation as are employees. Nevertheless, you are allowed to reside for 3 weeks per year in another place than you main residence, with the consent of your contact person, while your absence must not hinder your occupational re-integration in any way.

Tips, Checklist

  • File the application for unemployment benefit 2 as early as possible and hand it in to the responsible authority, that is ARGE or municipality. Payments will not be made for any time before the application has been filed. If the authority office has been closed before, those days will be taken into account for the payments
  • The application can be done by post, telephone or in a personal talk
  • When a member of a household-unit in need applies, then the application counts as a valid application on behalf of every member of the household-unit in need. However, members of a shared-living-space community must file their application each on their own
  • In order to receive unemployment benefit 2, you are required to have some bank account. There is no transfer fee
  • If you do not have an account, you will be given clearing payment instructions which you can cash at the Deutsche Post, subtractive a fee of € 2.10 each
  • Be sure to comply with your obligation to spend defined efforts to end or diminish your need of support status. Participate in the measures ordered by the labour agency / ARGE. If you do not, you risk your unemployment benefit to be cut
  • Be available for your contact person at the ARGE
  • Cuts on unemployment benefit 2 are possible, see regulations of basic security for jobseekers
  • Accept reasonably imposable jobs you are offered
  • Report changes in your personal situation to your contact person, e.g. side-line job remuneration, changes in your household-unit in need, pension you receive, and the like
  • Inform your contact person in the ARGE or the municipality in time, when you are intending to go on vacation, report back after the vacation. Both is necessary in order to avoid the ceasing or reclamation of unemployment benefit 2 payments

Information Sources



Last update: 01/31/2012
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