ELENA is here and is intended to deliver substantial savings. Clearly a topic for Impulse, the entrepreneurs' magazine, in December 2010. The facts: "Employers must transmit their employees' earnings data to a central storage location in Würzburg every month, including details on salary and the amount of social security contributions. If a citizen applies for housing benefit, unemployment benefit or parental allowance, the responsible authority should in future be able to retrieve the required data directly from there. Employers no longer have to issue paper certificates and face less bureaucratic effort. So much for the theory. In practice, following protests from data protection authorities, the agencies may only use the collected information from 2014 onwards, instead of from 2012 as originally planned. 'Employers must nevertheless continue to report,' says Pablo Mentzinis, Head of the Public Sector division at the information and telecommunications association Bitkom. For employers, this means: for another three years they must both complete paper certificates and transmit ELENA data every month."
On the topic of transmission effort, Katharina Kolhep, head of our accounting and financial bookkeeping department, warns in the article: "If the employer transmits incorrect information, sickness benefit or unemployment benefit may under certain circumstances be paid out to the employee incorrectly," because the article states: "As long as the number of employees remains manageable, it is not necessarily required to commission a Steuerberater specifically for payroll accounting. Manual data entry online is very time-consuming and typing errors can easily occur. The data is not stored in the form but must be re-entered every month."
It also remains unresolved who is liable for errors: "Who is liable for incorrect information has not yet been conclusively clarified. In any case, it is unpleasant for the employee concerned."
We are happy to discuss ELENA with you and to ensure that the liability question is, ideally, one without relevance to you. As a starting point, we recommend the attached article, which you can also find here on Impulse online. [wpfilebase tag=file id=18 /]
Frequently asked questions
Frequently asked questions
What was ELENA (electronic income statement)?
ELENA was a procedure under which employers were required to transmit their employees' wage data monthly to a central data storage office in Würzburg. Authorities were to retrieve this data directly when processing applications for housing benefits, unemployment benefits, or parental allowance, eliminating the need for paper certificates. The aim was to reduce the bureaucratic burden on companies.
Which data did employers have to report under the ELENA procedure?
Employers were required to submit monthly earnings data for their employees, including details on salary and the amount of social security contributions. The data was transmitted electronically to a central storage authority. In parallel, paper forms still had to be completed as long as the authorities were not yet permitted to retrieve the data.
What risks arise from incorrect ELENA reports submitted by the employer?
If the employer submits incorrect information, employees may receive sickness or unemployment benefits in the wrong amount. Typing errors are particularly likely with manual online data entry, as the data is not stored in the form but must be re-entered each month. In addition, the question of liability for incorrect submissions had not been conclusively resolved.
Why did ELENA initially mean additional work rather than relief for employers?
Following protests from data protection advocates, the use of the data by public authorities was postponed from 2012 to 2014. Employers, however, still had to transmit ELENA data on a monthly basis. This created duplicate work for several years: both paper certificates and electronic notifications had to be prepared.
When does it make sense to outsource ELENA payroll accounting to a Steuerberater?
With a larger number of employees, outsourcing to a Steuerberater (German Certified Tax Advisor) is worthwhile, as manual data entry is very time-consuming and error-prone. Since data was not stored in the form and had to be re-entered every month, the risk of errors grows with the size of the workforce. A professional service provider minimizes both the workload and the liability risk associated with faulty submissions.