COVID-19: Coronavirus - Emergency Fund NOW replaces Working Time Reduction [werktijdverkorting]

Information for Employers and HR Professionals on the Emergency Fund NOW

COVID-19 is now a top priority for any business in The Netherlands. Please make sure to stay up to date with daily updates published here: COVID-19 Coronavirus Netherlands – Employers Guide.

Under special circumstances, companies can claim a reduction in working hours for employees. A “special circumstance” includes events such as a fire, flood or epidemic, when this leads to (significant) loss of work. These are circumstances that do not fall under the normal entrepreneurial risk. COVID-19, (Coronavirus), now qualifies as a epidemic. In many cases it could lead for companies in stagnation or shortage of work. In that case, applying for a working time reduction of employees could be a solution.

 

Employment Bridging Emergency Fund – NOW [Noodfonds Overbrugging Werkgelegenheid].

Companies experiencing financial problems due to the Coronavirus could prior to March 17,  apply for a working time reduction. As per March 17, 2020, the current regulation for working time reduction, the unemployment benefit during short-time working [werktijdverkorting (WTV] has been cancelled. The scheme has been replaced with a temporary plan Employment Bridging Emergency Fund – NOW [Noodfonds Overbrugging Werkgelegenheid].

Due to an extraordinary event such as the Coronavirus, the Employer who has less or no work for employees can receive a substantial contribution towards labor costs. It is important to carefully substantiate in the application the direct relationship between the Coronavirus and available work, as the Ministry of Social Affairs and Employment has a strict measurements.

Please note, since March 17, 2020, it is also allowed to request a compensation less work or no work for on-call workers with a zero-hour contract – retrospective as of March 1, 2020.

 

Requirements 

The requirements for receiving the compensation are:

  • company is expected / or is losing 20% turnover from March 1 2020 onwards.
  • company is prohibited to dismiss employees on economic grounds during the period for which the compensation is received.
  • company is obliged continue to pay the wages of employees.
  • company to submit a statement from an accountant for claims that exceed a certain amount (the height of which is yet to be established).

 

  • The government prior to March 17, 2020 would pay 75 % (percent) of the last earned wages for the employer. The NOW ruling is for companies experiencing problems to pay the wages since March 1, 2020.
  • The government announced to pay, depending on the decrease in turnover a maximum of 90 % (percent).
  • The Employer has to pay the final 10% (percent).
  • The compensation for wages companies can claim depends on the turnover loss.

 

UWV will provide in advance 80% of the requested contribution. This allows companies to continue to pay their staff. The actual turnover loss will be determined afterwards. When determining the definitive compensation, a correction can be made, if there has been a decrease in wages.

 

How to apply after March 17?

Update March 25: This will be announced as soon as the information is available.

The application need to be submitted to the UWV. The Dutch government is currently working on the rollout of the ruling and the applicable processes. Our company Human In Progress can support you with submitting the application, once more details will be available.

 

Did you applied before March 17?

For applications send in prior to March 17, it is not required for companies to apply again for the replaced ruling. Applications will be transferred to the new plan. If additional information is needed, your company will be contacted.

 

Duration of the allowance

The allowance can in any case be applied for for 3 months, with the possibility of an extension by 3 months (extra conditions may apply to an extension application). 

Update March 25: Further details and ways of working to be announced as soon as the information is available.

 

Note: In case employee is ill, it is not possible to claim for those employees an unemployment benefit. The Employer is obliged to pay the wages in the event of illness according to the Sick Leave Protocol of the company or in case that is not in place, refer to the mandatory law on Sick pay.

Stay up to date – Manage the impact on the workforce

Ensure that the team leading the taskforce/communication is up to date with the Coronavirus situation. It’s hard for employers and employees to know what to do or what they are expected to do as the situation changes daily. There are also many other questions to be considered, such as what are an employer’s compliance obligations, and how leave, benefit and sick policies apply. Read COVID-19 Coronavirus Netherlands – Employers Guide.  Comply with current legal obligations and government guidance in The Netherlands.

 

For more questions, speak to our HR Specialists.

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