The NOW, the wage cost subsidy scheme, will be extended by three times three months from 1 October 2020. With the extension of the NOW, the Dutch government is supporting companies and jobs that have been hit hard for a longer period of time.
Aid will be phased out over the three-month periods by gradually decreasing reimbursement rates. In the period from October to December, this means that the maximum reimbursement percentage will be 80%. That is 10 percentage points lower than the maximum reimbursement percentage in NOW 2.0. The government is investing this money in training and work-to-work processes. In the period from January to March the reimbursement percentage is 70% and from April to June 60%.
At the same time, companies in this extended NOW scheme will also be given more scope to adjust the wage bill, without this affecting the amount of the subsidy. This allows them to ensure that their wage costs are more in line with the turnover they expect to achieve in the coming period. This is also done step by step. In the first period companies can adjust 10% of the wage bill, in the second period 15% and in the third period 20%. Wage costs can be adjusted by attrition, by firing people or by asking employees for a voluntary wage sacrifice. The regular rules of employment law continue to apply to this. The extra discount on commercial dismissal from NOW in the second emergency package will be canceled.
The minimum revenue loss to claim the NOW in the second and third periods, from January 1, 2021, will be increased from 20% to 30%. The obligation for employers applying for NOW to encourage their employees to take part in training continues to exist. This also applies to the prohibition on paying dividends and bonus payments. The fixed surcharge for employer's contributions, such as holiday pay and pension premiums, remains 40%. The maximum wage to be paid remains twice the maximum daily wage in the first two periods. In the third period this will be reduced to a maximum of once the maximum daily wage.
Employers will probably be able to apply for the first NOW period for October through December from 16 November at UWV
NAZALI TAX & LEGAL