Emergency measure Bridging for Work Retention (NOW)
The regulation Reduction of Working Time has been discontinued and the cabinet has introduced the temporary Emergency Measure Bridging for Retention of Work (NOW). Consultations are currently being held with the UWV about the exact implementation of this emergency measure.
What does the new emergency measure entail?
- Employers can apply for a substantial contribution to wage costs and receive an advance from UWV for this;
- With this deposit, employers can continue to pay employees with a permanent and a flexible contract;
- The allowance can at least be applied for three months, with the possibility of extension by another 3 months.
Conditions for NOW
- In the application, the employer commits to the obligation not to apply for dismissal on grounds of economic reasons for employees during the period for which the allowance is received;
- The employer expects at least a 20% loss of revenue (for revenue drops from 1 March 2020);
- An audit report is required for applications above the amount of the allowance that is yet to be determined.
For how long can an allowance be obtained?
The application is valid for a period of 3 months, which can be extended once for a further three months (further conditions may be imposed on the extension).
The amount of the wage costs allowance depends on the drop in turnover, with a maximum of 90% of the wage bill. For instance:
- 10% of the turnover is lost: the allowance amounts to 90% of the employer's salary;
- 50% of the turnover is lost: the allowance amounts to 45% of the employer's wage bill;
- 25% of the turnover is lost: the allowance amounts to 22.5% of the employer's salary.
First a deposit
On the basis of the application, the UWV will first issue a deposit in the amount of 80% of the expected contribution. It will be determined afterwards what the actual drop in revenue has been. When the allowance is finally determined, an adjustment will still be made if there has been a decrease in the wage bill.
It is not yet possible to submit a NOW application. As soon as more is known about this, Dutch Legal Experts will provide further information.
Dutch Legal Experts is ready to advise you. If you would like to discuss the new measure or other work-related issues, please do not hesitate to contact us.
March 20, 2020
Less work due to the Corona virus?
Shortening working hours and a temporary unemployment benefit for employees may offer relief. In special situations, companies can have their staff work shorter hours. For example in case of an epidemic such as the Corona virus.
Conditions for short-time working
The following conditions can be applied for for a permit to reduce working hours from the Ministry of Social Affairs and Employment (SZW):
- The company has been affected by a situation that does not fall under normal business risk.
- The company expects at least 20% less work for a period of 20 to a maximum of 24 calendar weeks.
For which employees can working hours reduction be applied for?
The scheme applies to employees for whom the employer has an obligation to continue to pay wages. This arrangement does not apply to temporary workers and on-call workers with a zero-hour contract.
The permit is valid for a maximum of six weeks. If there is no improvement in the company after this period, an extension of the permit can be requested. The maximum term for short-time working is 24 weeks.
Procedure after receiving a permit
- Immediately report the reduction in working hours to the UWV;
- Apply for temporary unemployment benefit for employees no later than one week after the end of the permit period;
- If the employees concerned meet the requirements of the Unemployment Insurance Act, they will receive this temporary benefit;
- UWV reimburses afterwards the number of hours they did not work during the permit period;
- This only applies to the hours for which the permit was granted;
- The temporary benefit is paid to the employer. As a result, the employer has less labor costs, while the employee simply remains employed.
Dutch Legal Experts is ready to advise you. If you need help with applying for a permit or unemployment benefits, this is of course also possible.
March 16, 2020
Leap day: what about holiday pay and benefits?
2020 is a leap year. The year lasts 366 days instead of 365 days. So we have an extra day on Saturday, February 29, 2020.
Are employees (with a monthly wage) entitled to extra salary if they work on 29 February? The answer to this question is no. The leap day for these employees is included in the monthly wage. After all, the wage does not depend on the number of days the month lasts. The monthly wage is always the same regardless of whether month 28, 29, 30 or 31 days lasts.
The foregoing is of course not the case for on-call employes, temporary workers or other employees who work per day or per hour. They have an advantage with this extra day. If an on-call employee is called up for work on 29 February, the employer will simply have to pay the wages for that day.
Surcharges that depend on whether or not they work on a leap day (such as overtime bonus) must be paid.
If an employee has a day off on February 29, this simply counts as a day off. This day can be deducted from the holiday balance.
Deadline for low unemployment benefit extended to July 1, 2020
Probably you may already be aware that with the introduction of the Labor Market Balance Act from 1 January 2020, the amount of the unemployment insurance premium is linked to the nature of the employment contract.
All flexible contracts (on-call contracts and fixed-term contracts) will have to deal with a high premium. This premium percentage is 7.94%.
To be eligible for the low premium, the following cumulative requirements must be met:
- there must be a written employment contract or addendum to the original employment contract;
- employed indefinitely no later than December 31, 2019;
- there may be no on-call agreement. The premium percentage (low rate) is 2.94%.
Why this change?
With this change, the government wants to encourage employers to offer an employment contract for an indefinite period.
Courtesy arrangement: deadline extended to July 1, 2020
The premium rates apply from 1 January 2020. Minister Koolmees previously announced that employers had to provide a written employment contract signed by both parties by April 1st 2020 at the latest. A unilateral confirmation of the provision of the employment contract for an indefinite period is therefore insufficient.
In concrete terms, this means that as an employer you can pay the low premium from 1 January 2020, even if the indefinite employment contract has not yet been laid down in writing or if the indefinite contract or addendum has not yet been laid down in writing or signed by both parties.
Because it is not practically possible for all employers to meet this requirement due to the coronavirus, this period has been extended to 1 July 2020.
What happens if the conditions are not met in time?
If the conditions are not met before 1 July 2020, but the employment contract continues after 30 June 2020, the high unemployment premium will still be payable retroactively from 1 January 2020.
Therefore, write down June 30, 2020 in your agenda and make sure that all conditions are met in time!
Do you need help with drawing up a permanent employment contract? Dutch Legal Experts will be happy to assist you!
March 20, 2020
Compensation for transition compensation Act for long-term incapacitated employees, effective from April 1, 2020.
Since April 1, 2020, employers can submit the long-awaited application for compensation for the transition fee (compensation) paid to employees in connection with long-term disability at the UWV. The scheme compensates the transition fees paid by employers in the aforementioned situation from 1 July 2015.
Conditions for the application
The following conditions apply to the application for compensation:
- The employment contract has been (partially) terminated due to long-term disability, and
- The employee was still ill at the end of the employment, and
- A transition fee (compensation) has been paid to the employee.
For new cases from April 1, 2020, the compensation must be requested within 6 months after payment of the full transition payment. The date on which the reimbursement is debited from the employer's account is decisive. If payment has been paid in terms, the application period starts from the date of the last payment.
The application for compensation in old cases (these are cases where the employment contract has been terminated and the transition payment has been paid between 1 July 2015 and 1 April 2020) must be submitted to the UWV by 30 September 2020 at the latest. If you do not do this on time, the UWV will reject the request for compensation.
For new cases from 1 April 2020, a decision period of 8 weeks applies after UVW has received the (full) application. That period can be extended, but the UWV must decide within a reasonable period.
For old cases, a decision period of 6 months applies after UWV has received the (full) application. This period is longer because there must be made a catch-up. More time must devoted to assessing old cases for that reason.
How much compensation will be received?
Usually, the compensation to be received will be less than the transition compensation paid to the employee. The following conditions apply:
- The compensation will not exceed the transition compensation agreed by the employee and the employer.
- A statutory maximum amount is set for the transition payment each year. The compensation cannot exceed this maximum amount. Unless the employee's annual salary was higher than this amount.
- Accrued transition compensation over the period of insufficient reintegration efforts (salary penalty) is not reimbursed.
- Statutory interest is not compensated, not even for payments in installments.
- Employer's premiums are not reimbursed.
Dutch Legal Experts can assist you in applying for compensation at the UWV. If you need help, please contact us by e-mail at email@example.com or by phone on +0031 (0) 6 414 56 113.
April 1, 2020