Introduction

Following the resurgence of the coronavirus in early November 2021, contact restriction measures were again introduced as of 12 November 2021. In December 2021, the Dutch government announced that an additional support package would be made available in the first quarter of 2022. Part of this package is the Sixth temporary aid scheme to maintain employment (NOW-6). The NOW-6 was published in the Staatscourant on 11 February 2022.1 The NOW-6 provides for a three-month wage subsidy scheme (from 1 January 2022 up to and including 31 March 2022). The NOW-6 can be applied for since 14 February 2022. Even if an employer did not make use of the previous NOW schemes, an application for NOW-6 can be made.

This Q&A outlines the most important aspects of the NOW-6. It also discusses the main changes to the NOW-2, NOW-3, NOW-4 and NOW-5 that have been incorporated into Article 23 NOW-6.

1. What is the purpose of the NOW-6?

Article 3 NOW-6 sets out the purpose of the subsidy. The purpose of the NOW-6 is to help employers with the payment for wage costs if there is a sudden drop in turnover by a minimum percentage (of at least 20%) during the turnover period. The aim is, on the one hand, to prevent unemployment as much as possible and, on the other hand, to enable employers, together with their employees, to prepare for and adapt to the new economic situation. It is explicitly noted that no profits or bonuses may be distributed, or own shares may be purchased (for the year 2022, according to the Explanatory Notes to the scheme). Pursuant to Article 13 NOW-6, this obligation is limited to the board and the management of certain companies (see question 12).

We would like to point out that in practice we have noted that it may be the case that the payment of a bonus under the text of the bonus ban as laid down in the NOW should be possible, but that the bonus payment would, according to the Minister of Social Affairs and Employment and/or the accountant of the relevant company, be in conflict with the purpose of the regulation. This is also stated in the FAQ published on the NBA website.2

In addition, Article 19 NOW-6 states that the aid may be withdrawn or amended to the employer's detriment if at any time it appears that the employer has not acted or failed to act during or after the period for which he received aid in line with the purpose of the NOW-6.

2. In respect of which employees may aid be requested?

Employers may request aid to compensate the wage costs for those employees (i) that are employed by the employer and (ii) that are compulsory insured under employee insurance policies (insured wages for national insurance contributions purposes, hereinafter referred to as SV wages). Thus, aid may also be requested in respect of employees on flexible contracts, provided they continue to be employed by the employer during the period in which aid is granted and continue to receive wages from the employer. Temporary work agencies and payroll employers may also request aid.

Foreign employers who employ employees that are insured under the Dutch national insurance system may also submit a request under the NOW-6. The NOW-6 does not apply in respect of employees that are seconded to the Netherlands but are insured under foreign national insurance systems.

Because the overall wage bill is determined on the basis of all employees who receive SV wages, the NOW-6 also applies in respect of employees that are - what is called - 'fictitiously employed', but not in respect of uninsured Directors-Owners (DGA's) or voluntarily insured persons.

3. How is the amount of aid calculated (percentage)?

To qualify for the NOW-6, there must be a loss of turnover of at least 20% (Article 14 NOW-6). In the NOW-6, as in the NOW-5, the maximum percentage of loss of turnover that can be declared is limited to 90%. The employer can therefore report a maximum loss of turnover of 90%, even if the employer has suffered a loss of turnover of 100%.

The aid is related to the percentage of loss of turnover of the employer or, if applicable, the group (see question 5). The subsidy is 85% of the percentage of the loss of turnover.

If the loss of turnover is less, the aid will also be proportionally less. Below is an example, noting that 100% loss of turnover is thus capped at 90% loss of turnover:

100 to 90% loss of turnover: aid equivalent to (90% of 85% =) 76,5%3 of the overall wage bill;
50% loss of turnover: aid equivalent to (50% of 85% =) 42,5% of the overall wage bill;
< 20% loss of turnover: aid equivalent to (20% of 85% =) 17% of the overall wage bill; and
20% loss of turnover: no aid.

The maximum reimbursement rate under the NOW is therefore 76,5%.

The answer to question 8 explains how the wage bill should be calculated.

4. How is the loss of turnover calculated?

Article 1(2) NOW-6 defines the term 'turnover'. For the definition of turnover, as in the previous NOW schemes, the definition of turnover in accounting law has been followed. The net turnover is taken as basis, i.e. the income from the supply of goods and services by the relevant legal entity's business after deducting discounts and the like from the tax charged on the turnover. Paragraph 4 explicitly states that the subsidy the employer receives under the NOW schemes does not count as turnover. Also, the Reimbursement Fixed Costs (Tegemoetkoming Vaste Kosten, TVL) is excluded from the concept of turnover under the NOW-6 (and under the NOW-3, 4 and 5). Paragraph 5 provides that unemployment benefits that the employer receives on behalf of employees under the Working Time Reduction Scheme (Werktijdsverkortingsregeling, WTV), which has been reopened since 1 October 2021 for non-corona related applications, count as turnover for the purposes of NOW-6

Footnotes

1 In Dutch: 'Regeling van de Minister van Sociale Zaken en Werkgelegenheid van 8 februari 2022, 2022-0000005023, tot vaststelling van de achtste tranche van een tijdelijke subsidieregeling tot tegemoetkoming in de loonkosten teneinde de werkgelegenheid onder buitengewone omstandigheden te behouden en voorbereidingen op de nieuwe economische situatie te laten plaatsvinden (Zesde tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid)'.

2 See FAQ's bonussen, dividenduitkeringen en inkoop eigen aandelen (art 6a NOW 1.0 en/of a) (nba.nl) – in Dutch only.

3 90% of 85% is 76.5%. However, the Explanatory Notes to the NOW-6 (p. 18) state that in this situation the employer receives subsidy for 77% of his wage costs (90% times 85%). In the Explanatory Notes on p. 18, the percentage for 50% loss of turnover is not rounded up. For safety's sake, in this Q&A we use 76.5%.

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