17 March 2020
The Dutch government announced on March 12, 2020 that companies affected by the consequences of coronavirus (Covid-19) are entitled to apply for a permit for reduced staff working times.
This measure is intended to support businesses during economic disruption from the pandemic.
Companies affected by the coronavirus can now appeal for shorter working time (in Dutch: werktijdverkorting, hereafter WTV). If this permit is granted, the WTV allows employers to reduce the working time of their employees unilaterally, and through a simplified process.
An employer is eligible for WTV when an incident of force majeure, such as the coronavirus pandemic, leads to reduced business activity. On the basis that at least 20% less work will be performed over the following 2 to 24 weeks, and that this is the direct result of an exceptional circumstance, the working hours of the employees may be shortened.
Note that WTV only applies to employees to whom you as an employer have an existing obligation to pay wages.
No WTV permit will be granted:
Employers must apply to reduce their staff’s working hours using the online form “Application reduction in working hours” from the Ministry of Social Affairs and Employment’s website. As part of the application, you must submit a list of employees. You may also be asked to substantiate that you meet the requirements of the WTV permit.
Each WTV permit is issued for up to 6 weeks, and for a maximum of 24 weeks in total. After the initial 6 weeks, if business is not improved, then you may request an extension to the permit. The extension must be submitted before the end of the initial 6 week period.
Throughout the period of shorter working hours, you as an employer should continue to pay staff salaries as usual.
If the WTV is granted, then the employer must notify the Employee Insurance Agency (UVW) directly. Within the following week, the employer may then apply for unemployment benefits for the employees. If the conditions are met, then the UVW will transfer the unemployment benefits to the employer.
Note that sick employees may not claim unemployment therefore you as employer must continue to pay sick employee’s wages as normal.
This measure has been implemented to assist companies in surviving the current unforeseen challenges. The WTV enables companies to retain their staff, so that business can be more easily resumed once the pandemic has passed. It also facilitates the employer’s legal obligation to continue paying staff wages. The impact on employees is also minimised as, while their working hours are reduced, they continue to receive their salary as usual.
As such, the WTV lessens the need for hasty redundancies and helps companies with the cash flow needed to continue paying salaries, while setting the foundation for the best possible business recovery.
If you are uncertain if your staff qualifies for WTV, or if you need assistance with the application, or you’re seeking advice about a related employment law topic, please contact us.
The above advice is based on current employment law of the Netherlands, and excludes employees working in essential services professions.
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