The concept of the compensation for short-time work (Kurzarbeit) works, in its core, like this:
If the workload is reduced in a way, that at least 10 % of the personnel is affected, the employer is able to apply for the short-time work compensation.
The implication of short-time work has to be discussed and agreed upon by every affected employee.
After the consent of the employee, the employer will send the application to the federal employment agency.
The employer then pays out the pro-rata salary and the federal employment agency pays 60 % of the difference to the normal salary. However, the amount that the agency pays has to be pre financed.
First, the employer will pay the full amount to its employees and afterwards the federal employment agency will refund its share of the salary to the employer.
Also, it has to be noted that the amount of 60 % might differ, depending of the family status of the employee.