A 5% redundancy penalty has been included in the NOW scheme 2.0. The NOW scheme will also now
run until the end of September.
What does NOW 2.0 entail?
Companies that have suffered a drop in turnover can obtain a contribution towards their payroll costs.
This NOW scheme reimburses up to 90% of the payroll costs of companies whose turnover drops by
at least 20%. The maximum compensation of 90% applies if a company loses all of its turnover. If the
drop in turnover is smaller, the compensation is reduced proportionately. This means that if a company
sees its turnover fall by 50%, it can receive compensation for 45% of its payroll costs.
How is the drop in turnover determined?
The drop in turnover is determined over a four-month period, for which the company can choose 1
June, 1 July or 1 August as the starting date. It is not yet known whether this period can also
commence on 1 September. In the case of applicants who are taking advantage of the NOW scheme
for a second time, no choice is available, as the turnover period must fit in with the timeframe chosen
for the first scheme period.
Accumulation of coronavirus subsidies
Under NOW 2.0 the level of the wage bill is derived from the wage bill for March. Any subsidies that
entrepreneurs receive within the context of the coronavirus crisis are counted as turnover for the
purposes of both NOW 1.0 and NOW 2.0. As a result, entrepreneurs who also receive a contribution
on the basis of the TOGS scheme or the new TVL scheme receive a lower contribution via the NOW
The government hopes that the extended NOW scheme 2.0 for June, July, August and September will
be open for applications from 6 July. It is now possible to apply for the payroll costs subsidy under
NOW 1.0 until 5 June (previously 31 May).
The fixed (flat-rate) mark-up under NOW 2.0 has been increased from 30% to 40%. In this way the
NOW scheme will also contribute towards costs other than payroll costs.
An adjustment has been made to NOW 1.0 with a view to supporting seasonal businesses that
increased their workforce between January and March. The wage bill for March will now be taken as
the frame of reference instead of the unrepresentative wage bill for January.
If the wage bill from March to May is more than three times the wage bill for January, the wage bill
from March to May is taken as the basis for calculating the final subsidy. The wage bills for April and
May will then be capped at the level of the wage bill for March, with 15 May as the reference date. This
new calculation method will automatically apply to all employers who have a higher average wage bill
over the period from March to May compared with January (including capping).
Additional conditions for bonuses
A company that takes advantage of NOW 2.0 may not distribute any dividends to shareholders, pay
any bonuses to its board and/or management or buy back any of its own shares. The condition that no
transactions of this nature may be effected in 2020 will apply up to the shareholders’ meeting in 2021,
when the financial statements are adopted. Dividends, bonuses and shares for 2019 are not subject to
this condition. ‘Bonuses’ is also understood to cover profit-sharing and other forms of bonus payment.
This ban only applies to companies that are receiving a contribution for which a declaration from an
accountant is required.
Under NOW 1.0 the ban on paying out dividends and bonuses and buying back own shares also
applies to companies that fall under the group scheme.
Declaration from an accountant
You need a declaration from an accountant if you have received an advance payment under NOW 2.0
or NOW 1.0 of € 100,000 or more. To determine this amount, you need to add together the various
applications submitted for the payroll tax numbers within your company or group. If you are paid an
advance of less than € 100,000, but receive a subsidy of € 125,000 or more when the final subsidy is
determined, you also have to submit a declaration from an accountant. You will need to estimate
yourself whether the final subsidy determined will come to € 125,000 or more.
If you receive an advance payment exceeding € 20,000, or an amount exceeding € 25,000 when the
final subsidy is determined, you must submit a declaration from a third party confirming the drop in
turnover. This third party may be a financial services provider, for example.
Redundancy penalty changed
The redundancy penalty is changing under the NOW scheme 2.0. Under NOW 2.0 the redundancy
penalty is now 5% on the total amount of the NOW subsidy. This penalty is imposed if 20 employees
or more are being made redundant and no agreement has been reached with the trade unions or
employee representation body. If the parties are unable to reach an amicable solution, a request for
mediation must be submitted to the Labour Foundation. In the absence of an agreement or mediation
request, the redundancy penalty will be imposed.
This applies to redundancy applications submitted to the Employee Insurance Agency (UWV) between
29 May and 30 September 2020.
One aspect of NOW 1.0 that has been retained under NOW 2.0 is the fact that no payroll subsidy is
received for employees who are made redundant for commercial reasons. In this case a 100%
correction is applied to the NOW subsidy. The 50% redundancy penalty applied under NOW 1.0 has
been abolished under NOW 2.0. The statutory protection in the event of redundancy remains in force,
which means the employer is still obliged to make a transition payment.
Further training and/or retraining mandatory
Employers who apply under NOW 2.0 will be subject to a best-efforts obligation to encourage their
employees to undertake further training and/or retraining. The aim is to limit the number of compulsory
redundancies as a result of the coronavirus crisis as much as possible. To this end, the government is
making a € 50 million training package available under the name ‘NL leert door’ (‘The Netherlands
keeps learning’). This package, the further details of which are yet to be worked out, will include
development advice and online training specifically geared towards career steps that are relevant to
the needs of the labour market.