The Dutch government recently announced a package of emergency measures in response to the coronavirus. This information is scarcely available in English. Because many people with an international background live and work in the Netherlands, Rendement Uitgeverij has decided to provide this information free of charge to those employers and employees. Our editors will add new information on a regular basis.
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The Dutch government has decided to extend the term of the new round of ‘coronavirus support’ by one month, i.e. until 1 October 2020. In addition, it has been decided to increase the compensation given for fixed charges. Businesses can now appeal for a compensation of €50,000 for four months, whereas this used to be €20,000 for only three months.
The new round of coronavirus support measures was published last week and was originally available until 1 September 2020. However, the government has agreed to a one month extension, making the new end date 1 October 2020. In the meantime, the government will meet with trade unions and employers’ organizations to discuss what action is necessary, both for the short and long term. This should result in the creation of a consistent and feasible package of measures for the next stage.
Because of the extension, involving over €4.5 billion, the following schemes will be available for longer:
Furthermore, extra money has been made available for the ‘coronavirus bridging loan scheme’ (COL), intended for start-ups. Because start-ups usually do not have any banking relationship, they can apply for credit through so-called ROMs (regional development companies). Originally, €150 million was reserved for these loans; however, how that the term of the new round of coronavirus support measures has been extended by one month, this amount has been increased to €200 million.
Extra money has also been made available for the TVL scheme, a scheme intended to help businesses in paying their bills for fixed charges such as rent or maintenance. The compensation was originally set at a maximum of €20,000 for three months, with the amount a business would receive depending, amongst others, on the loss in revenue. According to various employers’ organizations, this amount was insufficient for bigger SMEs. In response, the government has decided to increase the maximum to €50,000 for a term of four months. According to the government, the increase now also means that any money received through the TVL scheme is regarded as revenue for the NOW scheme. The loss in revenue is directive in the NOW scheme: the higher the revenue, the lower the compensation.
An extension of the NOW scheme with new conditions has been announced: the NOW 2.0. The current NOW scheme, called NOW 1.0, will also be adjusted. The NOW 1.0 scheme will become available to more organizations, but they have to apply quickly.
The NOW scheme, created for the purpose of preserving employment, enables organizations to receive financial compensation for wage costs when the coronavirus crisis has dramatically reduced their revenue. The final application date for the scheme was originally 31 May 2020, but has now been changed to 5 June 2020. The second round of NOW support (NOW 2.0), for which additional conditions apply, is planned to be available from 6 June 2020. Through this scheme, a financial compensation can be received for four months. NOW 2.0 has not yet been published.
The final application date for NOW 1.0 has been postponed by a few days in order to allow organizations to anticipate to several adjustments to the scheme. At the start of May, NOW 1.0 was made available to concerns. Now, the scheme has also been made available to seasonal businesses or businesses which have recently experienced a transition. These businesses are able to apply for financial compensation for March, April, and May 2020.
The ground rule for NOW 1.0 is that the compensation is based on the wage bill of January 2020. This means that almost no compensation is received by organizations which see little activity during winter or organizations which have recently taken over another business. Therefore, an alternative calculation exists whereby an increase of the wage bill for March, April, and May 2020 can be included, provided that the total amount of these wage bills is higher than three times the wage bill of January 2020. Moreover, the total amount is also maximized at three times the wage bill for March. This alternative calculation makes the NOW 1.0 also available to organizations with no (or a small) wage bill for January.
The (extra) compensation based on the alternative calculation will not be paid as an advance, which means that organizations will only receive the money once the definitive amount has been determined. A definitive determination will not take place before 7 October. Earlier, it was decided that 1 June was the date from which employers should be able to request a definitive determination; however, this date has been postponed as the government wants to avoid any overlap with the term of NOW 2.0, which will last until the end of September.
The government has once again reserved billions to mitigate the effect of the coronavirus crisis on businesses. A new round of ‘coronavirus support’ has been set up, involving €13 billion and available until the end of August. Partly, this new round of support is more generous than the previous round; however, in some ways the new support is also subject to more conditions.
According to the Dutch government, the new round of ‘coronavirus support’ better suits the current circumstances in which the Dutch economy finds itself. When the first round of support was announced, there was still hope the economy would quickly recover; however, that hope has longs since disappeared.
The new round of support aims to help businesses adapt to the new circumstances. There is the possibility for a third round of support after 1 September, depending on the situation at that time. However, as stated clearly by the ministers of Economic Affairs, Finance, and Social Affairs during the publishing of the new round of support, there will be ‘that moment’ when businesses are expected to stand on their own two feet again. The most important changes in the coronavirus support are summed up below.
Extended by three months, but the income of a partner is now taken into consideration during the determination of the compensation. When the total income, including that of a partner, exceeds the social minimum, no TOZO will be received.
During the probationary period, an employer has the chance to get to know an employee and to assess whether or not (s)he fits in the organization. The coronavirus crisis has made the probationary period less useful, but there are several solutions to this.
The coronavirus epidemic has changed the situation for many organizations. Amongst others, it has forced employees to work from home. This makes it more difficult for an employer to get to know a new employee well. Therefore, an employer can propose an extension of the employee’s probationary period. When the employee agrees, the employer must document the extension to make it legal. Unilateral approval is not possible: both the employer as well as the employee must approve the extension.
The law dictates a maximum limit for the duration of the probationary period, which restricts the possibilities for an extension (although the rules in the CLA can deviate somewhat from this legal maximum). For a permanent or temporary contract of two years or longer, the probationary period may not be longer than two months. For a temporary contract of less than 2 years but longer than 6 months, the probationary period is one month. For contracts of 6 months or less, a probationary period is forbidden. An extension is thus not an option when employer and employee have agreed in the contract to the maximally permitted probationary period.
When no contract has yet been signed, another option for an employer is to propose to the employee to suspend employment. The employer will then adjust the starting date in the contract. This is also a good deal for the employee: this way, the scenario in which the contract is terminated after the probationary period can perhaps be avoided. Moreover, this will increase the chances of a useful probationary period for the employee him-/herself, especially since employees will return to office soon for a few days a week. Nonetheless, employers are still free to terminate contracts after the probationary period, even when employment has been suspended.
Underlying conditions appear to have a great impact on the course of a coronavirus infection. So far, no vaccination or medicine against the virus is available. Therefore, 1,600 health professionals have made an appeal to the public to better our lifestyle.
It has now become very clear that there is a link between a serious coronavirus infection and underlying conditions such as diabetes, high blood pressure, obesity, and cardiovascular diseases – conditions which are for the large part the result of a bad lifestyle. According to Dutch broadcasting organization NOS, 43.5% of patients who died of a coronavirus infection suffered from cardiovascular diseases or a high blood pressure. Another 25% were type 2 diabetics. Because there will be no vaccine or medicine available in the near future, much can be gained by improving our lifestyle. Fit individuals have a better natural defence against the coronavirus.
A large group of 1,600 health professionals has therefore made a public appeal today. Not only the government, but also employers, employees and everyone else can play a role in the improvement of our lifestyle. And this improvement is more urgent than ever, according to this group of, amongst others, physicians and scientists. For instance, employers can see to changes in food and beverages available in the company canteen or vending machines, as well as encouraging employees to cycle to work (e.g. by offering them a ‘company bike’) or use the stairs instead of the elevator.
Employees can also do a lot themselves. The can organize ‘lunch walks’ with groups as well as take one or two breaks a day to do some exercises together with colleagues. The ‘seven minute workout’ is a good example of such exercise. Those working from home should take an active break regularly. And finally, everyone can contribute to their own health by improving their diet.
Even during the coronavirus crisis, fraudsters do not shy away from a sneaky type of fraud: a business email compromise attack. The Anti Money Laundering Centre (AMLC), the Dutch police, and the Netherlands Public Prosecution Service warn against this type of fraud. A fraudster pretends to be the CEO of an organization and asks an employee working in the financial department to quickly make a transaction.
A business email compromise attack looks like a regular email from a high-ranking member of an organization to an employee, usually one working in the financial department. However, it involves a fraudster pretending to be the CEO. The fraudster has hacked into the email account of the CEO, which makes it appear to be an email actually from the CEO. Due to the hierarchical structure within organizations, the employee is often inclined to give in to the request of the fake CEO.
The coronavirus crisis has caused most people, including those working in the financial department, to work from home. For cybercriminals, it has therefore become easier to hack into your organization, since a home network is usually less secure than a business network. Moreover, certain safety protocols, such as a separation of duties, are not always followed when working from home. When a request is send for a transaction to a account number mentioned in an email, always verify whether or not the request is real, e.g. by calling the CEO in question. The same applies to any request for private data and information. Especially Monday and Tuesday are days to be extra careful: research has shown that almost half of business email compromise attacks take place on these days.
Business email compromise attacks are currently the most dangerous type of cyber fraud, yet it is much less well-known than phishing, whereby a criminal sends the reader an email with an infected link. Most employees know to avoid clicking on a link in emails – more and more with fewer spelling errors – from an unknown sender. However, when the sender is known, they are more likely to meet the request in the email.
Dutch state secretary of Finance, Hans Vijlbrief, has published the conditions pertaining to corporate tax which a business must meet in order to create a ‘corona reserve’ for 2019. The creation of a corona reserve should quickly give these businesses a bit more financial breathing room.
Businesses paying corporate tax which are expected to suffer a loss this year are permitted to offset this loss against last year’s profit. In principle, this can only be done once the corporate tax return for 2020 has been filed, but this is only possible at the start of 2021. For this reason, the Dutch government has approved the creation of a ‘corona reserve’. The latter is the amount of expected loss for 2020 caused by the coronavirus crisis. This amount can be offset against the profit for 2019 and the overpaid corporate tax can then be reclaimed. Recently, the state secretary of Finance has published the conditions which must be met for the creation of a corona reserve.
The following conditions apply to the creation of a corona reserve in 2019:
The offset of the expected loss in 2020 against the profit in 2019 can be arranged by appealing to the Belastingdienst for a provisional assessment of corporate tax for 2019. When the 2019 corporate tax return has already been completed, the business in question must file a new corporate tax return for 2019 when it wants to create a corona reserve.
The creation of a corona reserve may have consequences for other schemes applicable to corporate tax. For example, it is possible that previous losses from before 2019 can no longer be carried over to offset a profit in future years when a corona reserve is created for 2019. Therefore, pay attention to the amount which is allocated to the corona reserve to avoid losing the possibility for a tax loss carryover!
A change to an employee’s travel pattern because of the coronavirus crisis does not affect the fixed amount of reimbursement this employee receives for his/her travel expenses. It has been decided that for the time being, the employer may continue the payment of this fixed reimbursement tax-free; also when the employee travels to the office again for a few days a week.
State secretary of Finance Vijlbrief has summed up all financial measures implemented as a result of the coronavirus crisis. Amongst these is the approval to continue the tax-free payment of fixed reimbursements for travel expenses. Even when an employee’s travel pattern has changed as a result of the coronavirus crisis, this does not affect the reimbursement. An employer may continue to pay the reimbursement tax-free, with the amount based on the travel facts from before the coronavirus crisis. Of course, the only condition is that reimbursement must meet the criteria for tax-free payments.
Image a scenario where an employee has been working from home five days week since 16 March, whereas under normal circumstances (s)he would have travelled to the office for work three days a week. Recently, the employee has gone back to office for one day a week. This entire period can be treated by the employer as if the employee still travels to the office three days a week, and thus the employer may continue the tax-free payment of the fixed amount of travel reimbursement to the employee. It is yet unknown for how long this regulation will remain in effect. For now, until the decision is revoked by government, employers may continue the tax-free payment of fixed travel reimbursements.
At the moment, the state secretary still frequently adds new financial measures to the list. In addition to the approval for the continuation of fixed travel reimbursement, we have also seen an increase the annual amount of tax-free expenses for employees as well as the introduction of a new calculation for the customary salary of director/major shareholders.
In terms of Dutch national law, an employer is not legally required to continue the payment of a fixed travel reimbursement when an employee has no travel expenses. When an employee stays home, either because of illness or to work from home, it is more than reasonable for an employer to (partially) suspend the payment of a fixed travel reimbursement. Yet, when the in-house employees’ manual, the in-house working conditions agreement, an employee’s contract, or the applicable CLA dictates that an employee is entitled to a fixed travel reimbursement even when (s)he is not travelling, an employer is legally required to do so. If this is not the case, it suffices for an employer to send the employee a written notification of the suspension of travel reimbursement. Employers are recommended to include an explanation in the notification.
The coronavirus leaves its marks on the Dutch economy. Business confidence is reaching its all-time low in the second quarter of this year, consumption is decreasing, and the economy has shrunk in the first quarter of this year. And the predictions for the future aren’t any better.
The data recently published by Statistics Netherlands (CBS) is not at all positive. During the first quarter of this year, the Dutch economy has shrunk by 1.7%, despite a growth in January and February. This means that halfway through March, when the ‘intelligent lockdown’ went into effect, the economy suffered a massive blow.
This massive blow was mostly the result of customers spending a lot less money. In a way, there was less to spend given that restaurants, bars, and most shops closed. However, the data by the CBS shows that the coronavirus crisis has also left its mark on customer confidence, which dropped from ‒2 to a staggering ‒22 at the beginning of April: the largest drop ever.
Business confidence also shows a drastic decline:
According to the CBS, business confidence in the second quarter of this year was ‒37.2, the lowest figure ever and also substantially lower that during the economic crisis of 2009. Figures are in the red everywhere, but businesses are most pessimistic about revenue, production, and manpower.
All current developments are putting a halt to the economic developments in the second half of 2020. Many business prefer to hold on to their money for now, as 44% of businesses are expecting a decline in investments. Another sign of hard times to come is that at the end of the first quarter of this year, there were 60,000 fewer job offers than at the end of 2019. All these are indicators that the current crisis will have a long aftermath.
The CBS does state that the data for business confidence was collected before the announcement that the coronavirus measures were going to be relaxed; yet, business organizations MKB-Nederland and VNO-NCW state that the situation has not improved in the meantime. The organizations therefore once again argue that any new support measures should also compensate the fixed charges of businesses.
A survey amongst chief financial officers (CFOs) to identify the economic impact of the coronavirus crisis shows that 64% of CFOs intends to adjust the safety measures and requirements and to speed up the implementation of automation and other new ways of working (46%). The worldwide survey was conducted by PricewaterhouseCoopers (PwC).
The survey also shows that CFOs will look for alternative ways to purchase goods and services and intend to get a better insight into the financial and operational state of their suppliers. Most CFOs are also considering measures to reduce costs. Moreover, CFOs are working on various actions pertaining to their work locations, supply chains, and investments to improve the position of their organizations in the world after the coronavirus crisis and to be better prepared for future crises.
An essential part of the stabilization of business operations is the reopening of offices, factories, and other work locations. The two most important measures considered by CFOs in this area are changes in safety measures and requirements at the work floor (64%) and the rearrangement of work locations to improve the distance between workers (55%).
In total, 46% of the 871 questioned CFOs says they will speed up the implementation of automation and other new ways of working. For CFOs in the financial industry, working at distance plays a key role in their plans. About half of them prioritizes the development of alternative ways to purchase goods and services (52%) and gaining an insight into the financial and operational state of their suppliers (50%).
The looming danger of a recession (69%) and its financial impact on business activities (67%) are the greatest concern for CFOs. Around 49% of CFOs are of the opinion that their activities could resume in normal fashion within three months if the coronavirus epidemic would cease today. However, on average 70% is still very concerned about the possible impact the crisis has on business.
As a result of the coronavirus crisis, the Dutch government has implemented various measures. These measures have also had consequences for money laundering; consequences which have been mapped by the Anti Money Laundering Centre (AMLC) in collaboration with chain partners.
Criminals operative in petty crime often sustain themselves partly by cash money from illegal sources. Because many businesses currently do not accept cash money, these criminals are now forced to look for alternative ways make payments, for example through debit or credit cards. Therefore, criminals in possession of a lot of cash money – which they can’t use at the moment – may worry about inflation or theft of their money. The AMLC, the research institute where public and private parties, both national and international, cooperate to combat money laundering, has already detected a rise in cash-to-gold exchanges as well as safe rentals.
For criminals using a business, e.g. a fitness centre or café, as a cover for their criminal activities, several scenarios are imaginable. Part of these ‘cover businesses’ are now closed or experiencing a sizeable loss in revenue, which negatively affects the money laundering. Therefore, criminals may decide not to acknowledge the loss in revenue in their tax return, but then they are taking a huge gamble. Instead, when a criminal is not dependent on the income of the ‘cover business’, (s)he will go along with the current crisis and wait for better times to come. Part of these criminals will fictitiously transfer their current business activities to other business activities which can continue during the current crisis or they will set up an online shop. Fictitious goods such as software tools or gift vouchers can be bought with dirty money, e.g. via bitcoins, and then be sold.
The AMLC has made an overview which can help unwitting accomplices, such as banks and other financial institutions, detect unusual transactions and activities. Amongst others, these include money transfers to a foreign bank account shortly after receiving a subsidy or businesses which started in March and already see a immense increase in revenue.
From 15 May until at least 1 September, the sale of face masks will be at a 0% VAT rate, as stated by secretary Vijlbrief of the Ministry of Finance. Currently, the regular 21% VAT rate still applies.
From 1 June onwards, face masks will be mandatory for anyone using public transport. In order to make the purchase of these masks less expensive, state secretary Vijlbrief has announced that a 0% value-added tax rate will go into effect on 25 May for face masks.
Both medical and non-medical face masks may be worn in public transport. The 0% VAT rate will apply to both types of face mask. Because face masks will not be exempt from VAT but instead a 0% rate will apply to the sale of face masks, input tax must still be paid to suppliers. Retailers of face masks will then be allowed to deduct the input tax they pay to their supplier(s) in their tax return.
Any further details on the implementation of this 0% VAT rate on face masks will follow as soon as possible.
Currently, organizations are contemplating ways to have their employees return to office whilst observing the coronavirus measures. However, vulnerable employees should receive special attention here. The Netherlands National Institute for Public Health and the Environment (RIVM) has published definitions of who should be regarded ‘vulnerable’ in the current circumstances.
Organizations are busy implementing all coronavirus protocols in order to make offices safe again for employees to return. It is important that vulnerable employees receive special attention here, since their higher risk of getting infected means the standard protocols are not sufficient for them. Instead, employers should take extra action to protect this vulnerable group of employees. For example, someone with COPD should not be placed behind a counter giving service to clients or customers.
The RIVM has published a list of who should be regarded a vulnerable individual. These are, for example, individuals between 18 and 70 years of age with:
The RIVM is more nuanced in its description of vulnerable individuals. Sometimes, the institute requires someone to go through treatment with a specialist. It is recommended the employer consults the occupational physician for advice: some of the conditions mentioned in the list above fall under medical information, which is not available to the employer. The occupational physician can therefore provide more insight and advise on the course of action.
Now most employees working from home, it has become easier for cybercriminals to break into organizations. After all, a household network are easier to break into than a business network. Be much more alert to possible dangers!
Phishing, ransomware, false billing, business email compromise, and so forth: cybercriminals can strike in various ways. With half of the Netherlands working from home at the moment, there is an higher risk for organizations to become a victim of cybercrime. Employees can no longer walk over to a colleague to blow off steam, they experience more stress, and are under a lot of pressure: all factors which cause them to be less alert to possible dangers. Instances of phishing for passwords and personal details have increased substantially since working from home has been made mandatory. Therefore, the Netherlands Fiscal Information and Investigation Service (FIOD), the Anti Money Laundering Centre (AMLC), the Netherlands Association of Banks (NVB), and advice & accountancy organization PwC call for an increased alertness.
What can employees do to help combat cybercrime? First, any update should always be installed, also on private laptops when used for work. Second, make sure your computer has proper antivirus software. Any suspicious emails, like emails demanding a short-term payment or emails from an unknown sender address, must always be fact-checked, which can be done by forwarding them to your supervisor and/or IT department. Also report the emails to Fraudehelpdesk (the Fraud Helpdesk, the Dutch anti-fraud hotline).
Has your organization fallen victim to cybercrime? The FIOD emphasizes the importance of reporting the incident and informing the bank. This way, appropriate steps can be taken and more knowledge is obtained about the ways in which cybercriminals operate.
There is hope again for Dutch businesses which have had to close their doors because of the coronavirus measures. When the current control over the virus is maintained, more and more business branches will be able to open again in the upcoming months. Meanwhile, the Dutch cabinet is busy creating a second pack of emergency measures, which are expected to be more tailored to the needs of different industries.
This week saw the restart of the economy out of the intelligent lockdown. Since 11 May, a large part of primary schools have opened their doors again and also e.g. barber are once again permitted to resume business – after two months, many of us really need a haircut. For other businesses, the government has announced a timetable (see below) for when they are allowed to open their doors again – at least, if the number of infections is kept under control.
Meanwhile, the Dutch cabinet is busy creating a new pack of coronavirus measures. Important current measures, such as the NOW and the TOZO schemes, will expire on 31 May 2020. Therefore, it is crucial the details of the new measures are worked out soon. It is already clear that the new measures will include various adjustments of the current measures. For example, minister Koolmees from the Ministry of Social Affairs wants to revoke the penalty for dismissals part of the current NOW scheme. Earlier this month, a rule had already been implemented that businesses making use of emergency measures are not permitted to pay dividends. And finally, the government has unanimously approved a resolution to have all fixed charges covered by the new emergency measures.
Government watchers have also told the media that the new measures will be more tailor-made. This means that different support will be provided to different industries, depending on their needs. Furthermore, the organization MKB-Nederland has proposed the creation of a fund for entrepreneurs who intend to quit their business.
The tailor-made support would fit the timetable published by the government for gradually opening up the economy again. After all, some industries are dependent on government support for longer than others:
Minister Van Rijn of the Ministry of Health is looking into additional measures to allow fitness centres to open at an earlier date. Fitness chain BigGym has already announced it plans on challenging the mandatory closure in court. It remains to be seen how many businesses will truly open their doors again on the set date, because a maximum of 30 people (including staff) is often not at all lucrative for a business.
The coronavirus has made working from home the new norm. Of course, there are still affairs which are best done in person, such as a performance appraisal. How can the appraisal be a success when it must be conducted at distance?
It is a possibility to postpone all performance appraisals until employees are permitted to go back to office. A performance appraisal is an important moment; therefore, it is preferable to conduct the appraisal in person, to be able to look each other in the eye, and to avoid having to deal with poor display quality or Wi-Fi. Yet, when the circumstances leave no other option than to conduct the performance appraisals via video conference, avoid planning too many of them in succession: video conferencing is exhausting.
The question remains how representative the performance of an employee at the moment actually is? Many employees are experiencing stress, suffer from a lack of supervision, or are being distracted by domestic obligations, such as caretaking. It is therefore important to look not just at the current performance, but also at the performance of the employee before the coronavirus crisis. Proper preparation is essential. A questionnaire can be a useful tool here, which can be filled out by you and the employee before the start of the appraisal. Fill out two questionnaires: one for the performance before the crisis and one for the performance during the crisis.
The performance from before the coronavirus crisis should be as expected. However, chances are that since the start of the crisis certain agreements are no longer in effect. This means that goals and expectations must be adjusted. The advantage of the crisis is that people have had the time to reflect more on what they actually want, also with respect to work. Chances are employees now know better what they consider important at work and what path they like their careers to take. Take the time to discuss this during the performance appraisal and set new goals together. Make these twofold:
Unless the employee really messed up, positive feedback is required. A positive approach has been proven to increase motivation by four times! Especially now, with the crisis wreaking havoc, employers shouldn’t underestimate a positive approach: the current situation requires employees to have a high degree of adaptability. Of course, the performance appraisal is not the only moment to voice your appreciation; better still, you should voice your appreciation of an employee whenever (s)he is doing a good job. In contrast, there are also employees who actually thrive at the moment. For them, their hidden talents now become apparent. Don’t leave these employees in the background and praise their performance.
Employers’ association AWVN expects chances are little that the wages in collective labour agreements (CLAs) will see an increase this year. The coronavirus crisis has suspended most CLA talks for quite some time now and employers are not looking forward to strict rules on wages during these troubled times. Despite the fact the works council has no say on the CLA, it does have a say in a business’s reward system.
CLA talks have reached a record low this year: never before were so few CLAs closed on as this year. April, May, and June usually see dozens of new CLAs, but April this year saw only six. In the meantime, over three hundred CLAs have expired and over one million employees in the Netherlands are now subject to the old CLA rules. Because of the coronavirus crisis, there are only few CLA talks planned for the coming time; and when those talks are planned, the AWVN warns against any high expectations.
Trade union FNV wants to adhere to a increase in wages of 5% in its CLA talks: the same percentage the as at the start of this year. In order to keep the economy from crashing, the FNV states that employees require purchasing power. Yet, the AWVN regards this view unrealistic. At the start of this year, wages in the CLAs increased by an average of 3%. In April, this figure was 2.4%. The AWVN does not expect wages to increase any further in the remainder of the year. According to the employers’ association, an improvement in working conditions is better found in more days off work as well as training/education.
According to article 27, clause 1c of the Works Council Act (WOR), the works council has the right to consent to changes in job evaluation and reward systems. This means an employer can only implement, adjust, or abolish such systems with consent of the works council. For organizations under no legal obligations from a CLA, the works council has all freedom to make decisions on the reward system. And even when a CLA does apply, the agreement leaves a lot of room for employers to negotiate, so the works council still exerts a lot of influence here.
The works council must be well acquainted with the CLA. The council can only represent employees when it knows all the ins and outs of the collective labour agreements and understands how much room it has for negotiations. After all, a CLA can both increase as well as restrict the power of the works council.
The confidence donors have in charities and non-profit organizations (so-called donateursvertrouwen in Dutch) has increased from -11 to -6 in the first three months of 2020. The coronavirus crisis therefore appears to have no affect in the first quarter of 2020, as shown by a rapport by the Nederlandse Donateurspanel (NDP).
Every three months, the NDP examines donor confidence in the Netherlands. The height of the index depends on the attitude towards charities and non-profit organizations, the willingness of donors to make donations, and the image of charities and non-profit organizations. In the first quarter of 2020, the index has increase substantially. Most likely, this is because it is an average of three months: the expectation is that the coronavirus crisis will have an effect on donor confidence in the second quarter.
Besides donor confidence, the rapport by the NDP also looked at how donors spent their holiday allowance and whether or not they like to have a say in a charity’s decisions. The rapport shows that for 9% of people the payment of holiday allowance is a reason to give more money to charity and 11% indicates they always give part of their allowance to charity. 36% never give anything to charity. When it comes to having a say in a charity’s decisions, 36% tells the NDP they do not feel the need to do so. Especially older people have no need to get involved in a charity’s business. Of those who want to have a say, 59% wants more involvement in the selection of projects or research by a charity.
The final issue addressed by the rapport is the choice of charity. There are many charities around and this makes choosing difficult. The following criteria are found to play a pivotal role in the choice of a charity (respondents could select multiple criteria): intended goal(s) money is spent on (67%), overhead expenses (35%), impact (29%), brand (26%), and reliability (22%). In other words, donors find it important to know what their money is spent on and that not too much money disappears in the pockets of bureaucrats.
Organizations are wondering whether or not they are permitted to take the temperature of their employees in order to combat the coronavirus. The Dutch Authority on Personal Data (AP) has published new information on this theme.
Some organizations have started to measure the temperature of employees and visitors upon entering the building. Anyone with a deviating temperature is denied access. However, the AP has emphasized that organizations cannot take anyone’s temperature without taking the rules into consideration. Often, measuring someone’s temperature involves the processing of medical data, which is prohibited by the General Data Protection Regulation (GDPR). An organization is said to process medical data when it does something with the temperature measurements, such as registering them or passing the information on in order to open a door or gate.
The GDPR does not apply when an employee takes his/her own temperature or when the measurement is not registered or entered into an automated system. In such instances, the AP cannot act against the measurement. Still, it is possible that in these instances a person’s legal rights are violated in a different way. For example, when an employee is denied access after the measurement, colleagues waiting in line behind the employee may draw conclusions about his/her health. Although this is not in violation of the GDPR, it may constitute an infringement of fundamental rights, such as ‘protection of personal privacy’ and ‘integrity of one’s body’.
In addition to privacy regulation, the Working Conditions Act (arbowetgeving) plays a major role. An employer can decide to continue temperature measurements on the grounds of safety; of course after approval by the works council. When an employer then processes medical data, (s)he risks a high penalty. Whether or not employees gave their permission for the measurements is not relevant due to the dependency relationship with the employer. Furthermore, organizations must realize that temperature measurements can give a false sense of security. Not everyone infected by the coronavirus will experience an increase in body temperature; and an increase in body temperature does not automatically mean the person in question has an infection. Nonetheless, temperature measurements are a way for employers to reduce the risk of coronavirus infections.
On 1 June, the Dutch government will extend the Temporary Emergency Scheme for the Preservation of Employment (NOW) for organizations which face severe problems as a result of the coronavirus crisis. It is very likely the new scheme will be different from the current, although the precise details are still under discussion.
The first pack of emergency measures, which includes the NOW scheme, is in effect for 3 months and will expire on 31 May 2020. Yet, because many organizations still face severe problems as a result of the coronavirus crisis, the NOW scheme will be extended on 1 June. The exact details of the new scheme are still under discussion, although minister Koolmees of the Ministry of Social Affairs and Employment has mentioned during the television programme Op1 that he wants to revoke the current rule that dismissals for business-related reasons are subject to penalties. There is no certainty this revocation will actually happen, as the opposition as well as trade unions oppose the decision.
Most likely, new conditions will be attached to the new scheme. Amongst others, businesses may not share their profit with shareholders, pay dividends, or buy back their own shares. Furthermore, the minister stated that the government finds it important that businesses invest in their staff, e.g. by re-skilling employees. Perhaps re-skilling will be one of the conditions attached to the new NOW scheme.
The current NOW was already adjusted recently. The scheme is now also available to individual operating companies part of a concern with a loss in revenue of less than 20%. In order to receive a compensation for wage costs, the operating company must meet several extra conditions. Amongst others, the operating company cannot apply for the NOW scheme when it is an intra-concern employment agency and must sign an agreement on the preservation of employment with employee representatives. Moreover, before applying for the scheme, the concern must declare it will not pay any dividends or bonuses in 2020, nor that it will buy back own shares until the date in 2021 on which the shareholders’ meeting takes place to determine the financial statements.
At the moment, it is very difficult for small businesses to obtain financial support. In order to help these businesses out, the Kleine Krediet Corona (KKC) scheme has been set up, in which the government stands surety for 95% of €750 million on bridging credit for small businesses with relatively small financing requirements (€10,000 to €50,000).
Soon, businesses with a revenue starting at €50,000 are able to appeal for the KKC-scheme. In addition to this minimum in revenue, the businesses must also prove they were profitable before the start of the coronavirus crisis and must have been registered with the Netherlands Chamber of Commerce (Kamer van Koophandel) before 1 January 2019. When a business meets these conditions, it can take out a loan of €10,000 at minimum to €50,000 at maximum for 5 years at an interest rate of 4%.
For this financing scheme, the government has reserved €750 million and will stand surety for 95%. When the scheme goes into effect, businesses will be able to appeal to Rabobank, ABN AMRO, ING, de Volksbank, and Triodos for a loan. Financers who already provide loans through the BKMB scheme will also be allowed to offer the loans through the KKC scheme. The scheme must still be approved by the European Commission; but once this approval has been given, it goes into effect immediately. The banks have stated that once the European Commission has approved the scheme, they will be ready and set to provide loans halfway through May.
Director/major shareholders (dga’s in Dutch) affected by the coronavirus crisis may adapt their customary salary to the loss in revenue. The Ministry of Finance has now published the calculation for this salary. Director/major shareholders may adapt the salary without discussion with the inspector.
The ‘customary salary’ (gebruikelijk loon in Dutch) applies to all shareholders with substantial interest in a company who also work for that company. During the payroll tax return, they must declare a salary which is customary for their employment. Under normal circumstances, this salary must be based on the salary of an employee in ‘the most similar type of employment’.
This would mean that despite a sizeable loss in revenue, a director/major shareholder would still have to declare a high customary salary. Because of the current crisis, this was a point of contestation. As part of financial support to director/major shareholders, the state secretary of Finance has therefore published a calculation for the determination of the customary salary for 2020. The calculation is as follows:
Customary salary for 2020 = customary salary for 2019 x (revenue in the first 4 calendar months of 2020 / revenue in the first 4 calendar months of 2019)
To illustrate, let’s consider the following example: the revenue in the first 4 calendar months of 2020 is €1,000 and during the same period in 2019 (the first 4 calendar months) the revenue was €100,000. The customary salary for 2019 was €45,000. According to the calculation, the customary salary for the payroll tax return of 2020 is equal to €450 (i.e. €45,000 x 0.01).
The state secretary therefore approves that the customary salary as a result of this calculation is lower than according to the regular rules. Director/major shareholders may lower their salary using the calculation without any prior discussion with the inspector; yet, discussing the salary is of course not prohibited. Moreover, the official decision also states that appropriate changes can be made to the customary salary for companies where the calculation does not provide any relief.
Of course, conditions apply. When the director/major shareholder has received a higher salary than determined by the calculation, (s)he must declare the higher salary during the payroll tax return. Furthermore, the dividend or current account debt may not increase as a result of the lower customary salary. The third conditions is that the director/major shareholder must use the ‘pure’ revenue in the calculation: the effects of e.g. establishments, strikes, mergers, scissions or other special occurrences must not be included.
Many employers have no clue how they must carry their organization through the coronavirus crisis. How far can employers go in their actions? And how ‘untouchable’ are annual leave and salaries? The works council should at all times observe the interests of employees when an employer decides to take action.
Financial giant AON demanded its employees to hand in 20% of their wages, Talpa wrote off four days from the total annual leave without consulting its employees, KLM threatened with a large-scale layoff if it wouldn’t receive any more financial support from the government, and trade association Koninklijke Horeca Nederland proposed to spread the payment of holiday allowance or suspend the accruement of it. And because the government now intends to revoke the rule that dismissals during use of the NOW scheme are subject to penalties, employees of troubled organizations will probably lose out even more. Works councils therefore have to be more alert to changes now that the coronavirus crisis is pressuring more and more organizations.
An employer cannot compel employees to give something up, but (s)he is free to ask them. This puts the individual employee on the spot. Because (s)he is dependent on the employer, the employee will most likely not feel free to refuse the employer’s request. To a certain extent, an employer may adjust, implement, or abolish regulations on working conditions, but (s)he must always first consult the works council before doing so. According to article 27 of the Works Council Act (WOR), the council has the right of consent to these action. The works council may also use its right of initiative (article 23, clause 3) to give the employer unsolicited advice and e.g. present an alternative plan. In other words, an employer does not have one-sided authority to change working conditions.
For many employers, lowering salaries temporarily or postponing the payment of holiday allowances are a last resort. However, this is not the case for all organizations planning to use government support or demanding sacrifices from their employees. The employer must therefore provide good support for his/her intentions. The works council may ask for additional information when the proposal isn’t entirely clear. Furthermore, the works council must consider whether or not the employer has looked into any alternative options with less drastic consequences for employees before giving its consent.
The works council of AON acted successfully against the intended reduction on employees’ wages. According to the council, AON is a financially strong business and it is unfair any entrepreneurial risk is passed on to the employees. The actions by Talpa, who wrote off several days of the total annual leave of employees, were approved by the works council. The latter argued it was a reasonable decision, because employees would not lose these days but simply had to use them within two months.
According to Statistics Netherlands (CBS), the first quarter of this year saw absenteeism reach its highest rate in 17 years. How should organizations deal with absenteeism and the privacy rules regarding ill employees during the coronavirus crisis?
Absenteeism amongst employees has increased to an average of 5.2% in the first quarter of this year. This makes it the highest rate since the first quarter of 2003, as stated by Statistics Netherlands (CBS) based on provisional figures. Virtually all sectors saw an increase in absenteeism, but in the health care sector and the industry saw the highest increase, at 6.7%. Because the data published by the CBS does not distinguish between months and weeks, the figures do not show the impact of the coronavirus on the increase in absenteeism. The end of February saw the first confirmed case of a COVID-19 infection in the Netherlands.
The coronavirus impacts the method of working in organizations as well as the rate of absenteeism, but in principle the rules regarding absenteeism do not change. In most instances, the employer continues the payment of wages to the ill employee, including instances where the employee only shows mild complaints (such as coughing or a cold) which prevent him/her from working, either at the office or from home. However, the coronavirus could make it more difficult for an organization to meet the re-integration requirements for employees who have been ill for a long time. The UWV already announced they will take this into consideration during their assessment of the re-integration report.
During the coronavirus crisis, the privacy rules regarding ill employees remain the same, though the Netherlands Authority on Personal Data (AP) has indicated that fighting the coronavirus currently has priority. An employer is not allowed to ask an employee whether (s)he is infected by the coronavirus nor to take an employee’s temperature, however the employer is allowed to instruct employees to keep an eye on their own health. The employer is of course allowed to take his/her own temperature. And due to the exceptional circumstances, an employer is allowed to send employees home showing (mild) symptoms, such as a cold or fever. And when an employer does decide to check employees, (s)he must realized the AP will impose high fines for such actions.
Because of the coronavirus crisis, there is the genuine possibility that some clients of your organization will not be able to pay their bills for the time to come. Bankruptcy is an ever-present threat. Given these circumstances, your organization must avoid being the next in line to topple. Of course, there is no danger when the amount owed is only little, but when one or two major debtors can suddenly no longer pay their bills, the bankruptcy of one can have a huge impact on your organization. In such a situation, your organization should appeal to a liquidator or take out an insurance on the risk.
When a client is unable to pay for provided goods or services, for example because of a bankruptcy due to the coronavirus crisis, your organizations can reclaim the provided goods through a liquidator. Furthermore, your organization can notify the liquidator of any accounts receivable so that this debt can be included in the settlement of the bankruptcy. These are the first short-term step your organization can take.
In the long term, it may be a wise idea to check whether or not a credit insurance, also known as a trade (credit) insurance, is an option for your organization. This insurance covers goods and services provided to business clients. For this, the organization must pay a premium over its revenue. When a client is unable to pay an invoice, the money owed will be paid to the organization by the insurance company. In return, the insurance company demands your organizations to stand out in its policy regarding debtors.
It is only possible to take out a credit insurance when you provide goods and services to business clients. The precise rules regarding the insurances as well as what is covered by the insurance and what not depends on the insurance company and the conditions attached to the insurance.
When you have taken out a credit insurance, you are insured against money owed by business clients when they cannot pay their bills. Sometimes, such an insurance is only valid for the Netherlands; however, it is also possible to insure yourself against debt by foreign clients who cannot pay as a result of bankruptcy or a shortage of money, or even political unrest, wars, or natural disasters. An export insurance will insure your organizations against foreign debtors.
Credit insurance companies may be able to help your organization in another way. Most insurance companies collect data on defaulters. When you plan on providing goods or services, it is recommended to ask the insurance company for the behaviour of the client(s). Sometimes, credit insurance companies give ratings on solvency. Another way an insurance company can help you is by setting up a collection procedure for clients known to pay their bills late.
Despite relaxation of the coronavirus measures, it is still unclear when exactly offices in the Netherlands can be (fully) re-opened again and the recommendation to work from home will end. For this reason, we will give some reminders to those who plan on going to office from time to time to check if everything is still okay there.
Are incoming phone calls still transferred to the right person? Is there a voicemail message which inform callers? Is the website still up-to-date? Does it state that the establishment is closed or abides by the RIVM guidelines? Make sure your website contains a short explanation on what these guidelines entail for your organization.
Most mail is sent digitally, especially now that half of the Netherlands is working from home. Still, it is advised to check regularly if your mailbox is not brimming. When your organization does not have a mailbox and mail is delivered through a slot in the door, make sure you collect the letters off the ground so that the door can still be opened. And by ordering the mail immediately, you will save yourself and your employees a lot of work when the office re-opens.
Many office workers have a plant on their desk. When the office building has a garden, this is usually maintained by one or more gardeners, but any plants inside the office must be watered by employees themselves. But who is looking after these plants now that almost all employees work from home? It is therefore up to you to water the plants regularly and remove any dead leaves.
When colleagues are still working on a wooden kitchen stool or plastic garden chair, arrange for their office chair to be delivered to their house. The same applies to computer screens, computer mice, and keyboards. Working from a non-ergonomic workplace for too long will result in physical complaints, which could eventually result in the employee having to cease work for some time.
Furthermore, regularly check the expiry date on food in the office refrigerator and throw out any expired items before they grow moldy and develop a life on their own. And while you’re at it, send employees a card or flower bouquet for in their home office: this serves as a kind gesture from their employer and causes employees to feel appreciated and connected to the organization.
The Netherlands is looking for ways to resume work life whilst observing all the coronavirus measures. To avoid a situation in which everyone must come up with solutions individually, the Netherlands Institute for Standardization (NEN) will coordinate the resumption. They are charged with devising several ‘quick norms’ which can be used by every single industry.
On the one hand, working from home will still be the norm for the time to come; on the other hand, organizations are busy to come up with ways to permit employees to return to work at the office whilst observing the coronavirus measures in effect. In most cases, this means an adjustment in the existing working conditions; but sometimes, the existing conditions must be revised completely. For organizations working according to established norms, this will be quite a challenge. The Netherlands Institute for Standardization (NEN) has acknowledged this and will assist organizations by means of an accelerated procedure.
Branches can submit their solutions and adjusted methods to the NEN. The latter will collect all initiatives and thereby establish broad-based agreements, which can lead to the adjustment of existing norms or the creation of completely new norms. In the short term, this means that norms can be developed to create coronavirus-responsible workplaces or protocols can be designed for new, responsible working methods. Every branch can contribute to this.
This accelerated procedure, the so-called ‘NEN-spec’, strives for broad-based support and should result in:
The NEN hopes that through its coordination, uniform agreements and guidelines can soon be realised whilst preserving quality and reliability. The new protocols and adjustments will be temporary.
The temporary emergency scheme for the preservation of employment (NOW) has been adjusted on several point. When they meet the conditions, individual operating companies of concerns are now also able to appeal for the subsidy scheme.
Minister Koolmees of the Ministry of Social Affairs and Employment had already announced he planned on adjusting the NOW scheme on several point. A decision by the government has now made the adjustments officially in effect. From now on, the NOW scheme is also available to individual operating companies part of a concern suffering a loss in revenue of less than 20%. The operating company itself – being a separate legal entity – must then suffer a loss in revenue of at least 20%, which can be proven through an auditor’s report. This special rule for individual companies does not apply to concerns with a loss in revenue of at least 20%. Here, the loss in revenue and the compensation are determined at the level of the concern.
In order to receive a compensation for wage costs, the operating company must meet extra conditions. Amongst others, it has been determined that the operating company cannot apply for the NOW scheme when it is an intra-concern employment agency and must sign an agreement on the preservation of employment with employee representatives. Moreover, before applying for the scheme, the concern must declare it will not pay any dividends or bonuses in 2020, nor that it will buy back own shares until the date in 2021 on which the shareholders’ meeting takes place to determine the financial statements. The accountant is in charge of enforcing such rules. How exactly the accountant must check if the company abides by the rules is still under discussion.
The following points have also been adjusted in the NOW:
An online survey of 123 branch organizations has revealed that virtually every business in the Netherlands has been affected by the coronavirus crisis. The survey was conducted amongst members of MKB-Nederland and VNO-NCW.
The survey has revealed that 93% of businesses have already been somewhat to severely affected. In March, less than half of the branches in question reported a loss in revenue of over 20%. In April, two-thirds reported such a loss. Only 1% of businesses is expecting an increase in revenue in the next three months. These are mostly businesses operating in online shopping or the food industry.
Many branches regard the possibility to defer tax payments and the NOW scheme good measures in the government’s aid package. As a result of these measures, the percentage of businesses reporting not being able to meet all requirements has dropped from 65% to 33% compared to March. However, there is uncertainty amongst the branches as to whether or not the aid package suffices for businesses. Almost 60% of branches foresee that businesses will not survive more than 3 months with the current aid package.
45% of respondents to the survey predict a large decline in investments in their branch and around 43% expects a mild decline. Unfortunately, this will not be beneficial to a fast and structural recovery of the economy and employment.
Over 70% of branch directors see possibilities in the so-called ‘1.5 meter economy’. Still, 29% state that the possibilities do depend on the availability of protective equipment. Moreover, 24% of branches is dependent on financial support in order to arrive at a viable business case. The ‘1.5 meter economy’ will still cause many businesses to lose money, because there will be a large decline in clientele as compared to before the coronavirus crisis.
A month after the unsolicited advice by the works council, the management of the Dutch National Opera & Ballet (NOB) in Amsterdam has decided to continue wage payments to freelancers already under contract until the end of June, with a maximum of €3,000 per month per contract. Because of this decision, over 200 artists, designers, extras, and makeup artists in the Netherlands alone will be guaranteed an income for three months.
The works council already pushed for similar arrangements on 27 March, but initially failed to convince the management who considered it a matter for the government. On 15 April, minister Van Engelshoven of the Ministry of Education, Culture and Science managed to reserve €300 million for cultural institutions in need, but this money wasn’t intended for the wage payments of freelancers.
The existing coronavirus schemes only ensured the preservation of jobs for around 600 employees working for NOB under a permanent contract. The schemes did provide freelancers registered with the Chamber of Commerce (Kamer van Koophandel) a social benefit; however, the works council was worried about these freelancers, and in particular those who work solely on a provision of services agreement, as the latter are not eligible to any coronavirus scheme.
After the advice by the works council, both the minister and the trade union made a similar appeal to the cultural institution. During the week of 27 March, all freelancers under contract with the NOB were informed by their supervisor that – despite performances having been cancelled – they would receive payments up to a maximum of €3,000 per month. The arrangements and the result of the NOB’s works council serves as a prime example of what unsolicited advice by a works council can achieve.
Two thirds of employees report that mutual solidarity has increased because of the coronavirus crisis and that the future of a business is now more often regarded a joint responsibility, as concluded by a recent survey amongst SMEs by Motivaction and MKB Servicedesk.
The survey shows that in 40% of businesses, employees take initiatives for the organization themselves. The vast majority (84%) of employers report they manage to assess feelings amongst employees and the same percentage states they have a clear picture of the state of affairs in their organization. However, only 62% is actually well-informed on what their employees are doing.
Over 40% of employers currently does not have enough work at the moment for all employees. The decline in work hours is on average 61%. Employers have resorted to different solutions: 14% has cancelled all training and education, 12% lets employees take paid leave, and 7% has postponed the payment of bonuses and holiday allowances. The coronavirus crisis has a great impact on small and medium-sized enterprises: 15% of SMEs and 38% of freelancers have had to cease all activities as a result of the crisis. However, 4% of SMEs and 2% of freelancers sees more work now than usually.
A quarter of entrepreneurs has appealed for income support. Other short-term action by SMEs and freelancers include:
Around 70% of entrepreneurs believes in the survival of their business in view of the coronavirus crisis. Still, one out of five entrepreneurs bears in mind their business could topple. More than half of respondents believes they have enough financial buffers to cope with the crisis, although 40% believes their buffers will not suffice.
Businesses are eagerly using government support in order to obtain financing from banks. The government has declared it will stand surety for loans. Since 1 March, over half a billion Euros on loans with state guarantee has been taken out. Still, entrepreneurs’ organizations expect this scheme to be expanded.
The NVB, an umbrella organization for banks, keeps track of financing during the coronavirus crisis. Between 1 March and 24 April, a total of 1,875 loans with state guarantee have been taken out, adding up to €517 million. Furthermore, 6,069 businesses have obtained credit without state guarantee, adding up to €3.8 billion. In addition, 103,000 businesses have been granted a deferral of tax payment(s).
The banks have thus not closed for business loans; however, they will continue to assess the situation case by case. “Banks are doing everything in their power to help business which were viable before the coronavirus outbreak cope with the crisis,” says NVB chairman Chris Buijink. “Banks are doing as much as they can, but are unable to help everyone. The crisis will leave behind its marks.” In the near future, banks are expecting an increase in loans now that the government has expanded state guarantee schemes. Through the GO and BMKB schemes, the government offers larger ‘corona-guarantees’. In the GO scheme, the state will stand surety for 80% or 90% of the total amount of the loan. The latter percentage applies to SMEs with an annual revenue up to €50 million. Above this limit, the state will stand surety for 80%.
In the BMKB scheme, the state guarantee is 67.5% of the total amount of the loan. For this scheme, the term was increased last week from two to four years. When a company applies for this scheme, the majority shareholder must also stand surety him-/herself for part of the loan.
Entrepreneurs’ organizations MKB-Nederland and VNO-NCW would like to see the government take it up another notch. They plead for a state guarantee of 100% for loans up to €100,000. According to the organizations, this is the case in Germany and speeds up the process. Before, they had already asked the government for a second aid package which would help business better and for longer. Business should also receive compensation in one way or another for the loss in revenue.
Monday 4 May is National Remembrance Day in the Netherlands. On this day, the national flag is flown at half mast. Because the coronavirus crisis means remembrance of the dead will happen mostly from home, the flag is permitted to be flown at half mast for the entire day, instead of from 18:00.
Normally, the flag is to be flown at half mast from the evening of Remembrance Day (i.e. 18:00) until sunset. However, in consultation with the council of ministers, prime-minister Rutte has decided to alter the flag code for 4 May. This year, the flag is to be flown at half mast from sunrise to sunset. Because the coronavirus confines people to their homes, they are permitted to fly the flag the entire day to commemorate the victims of World War Two from their own homes. This year marks the 75th anniversary of the liberation of the Netherlands.
On 4 May, all government buildings will fly the national flag of the Netherlands at half mast for the entire day: so-called uitgebreid vlaggen ‘extended flying of the flag’. Municipalities, provinces and diplomatic representatives are asked to do the same. The following directives apply:
First, raise the flag to the top of the flagpole, before lowering it slowly back down until it reaches the middle of the pole. Then, tie up the rope(s). At commemoration sites, lower the flag after sunset by raising it first to the top of the flagpole before lowering it all the way down.
Many organizations are dealing with questions on privacy at the moment and any European rules on the matter are yet far from completion. The Autoriteit Persoonsgegevens (AP), the Dutch Data Protection Authority, has advised employees to appeal to the works council and the data protection officer (functionaris gegevensbescherming) when their employer decides to take temperature to make the organization ‘corona-proof’.
The Dutch Data Protection Authority has received many questions and complaints about employers wanting to take the body temperature of employees and visitors, like truck drivers delivering supplies. Employers resort to all kinds of means to check whether anyone has a fever, ranging from thermometers to thermal cameras. However, establishing whether or not an employee has a fever constitutes medical data, which employers are forbidden from collecting. Doing so is in violation of the General Data Protection Regulation (GDPR).
According to the GDPR, an employer is forbidden from inspecting an employee’s medical data and is definitely not allowed to store any information on an employee’s well-being – the latter is reserved for physicians. This is even the case when the employee (or visitor) gives permission. Moreover, the works council has the right of consent (article 27, clause 1k of the Works Council Act) and will not approve a temperature measurement without a valid reason.
An employer who takes temperature as action against the coronavirus (or for any other reason) is in violation of the law, as this violates the privacy of employees. therefore, if an employer appeals to the works council for approval, the council will not consent to the proposed temperature measurements. When the works council receives word that an employer is contemplating the implementation of temperature measurements, the council can appeal to its right of initiative (article 23, clause 3 of the Works Council Act) to change the employer’s mind immediately. And when the employer implements temperature measurements without consulting the works council, the latter can nullify the decision and appeal to a judge (kantonrechter) if necessary to compel the employer to abandon his/her decision. Of course, an appeal to a judge should be a last resort only used when mutual agreement cannot be reached, since it would push the relationship between the works council and the employer right to the edge.
During crises, employers suddenly face a lot of new questions and must take many important decisions in a short amount of time. The works council can be of great service by actively assisting the employer in decision making to take appropriate measures for the organization during the current coronavirus crisis.
The number of participants in a WhatsApp video call or voice call has been increased from four to eight participants. Users must install an update. In view of the coronavirus crisis, the popular chat service appears to implement certain adjustments more quickly.
One by one, all participants must install the new WhatsApp update on their phones if they want to use the new maximum of 8 persons. For now, the update is only available in the App Store for iOS users. For Android phones, the new update can be downloaded via the website of Whatsapp. In future, the update will most likely be available in the Play Store as well.
Because of the maximum of 8 participants, video conferencing via WhatsApp is mostly suitable for small teams or one-to-one contact. Still, it is a godsend for those working from home at the moment. The advantage is that WhatsApp is available to both iOS and Android users and can therefore be installed on any phone. And because almost everyone knows how WhatsApp works, it is also an approachable medium. Moreover, it is freely available. Disadvantages are that user information is shared with Facebook, the is no screen-sharing option, and it is difficult to share files. The question is whether this is desirable, especially with regard to privacy.
Because of the coronavirus epidemic, video calling has increased dramatically in popularity worldwide at the moment. In order to see friends and family despite confinement, large numbers of people make use of video calling, not only on computers and laptops, but also on smartphones. Video calls on Whatsapp can include max. eight participants. For video calls with more people, other options exist, such as GoToMeeting, Google Meet or Skype.
The inspection of the Ministry of Social Affairs and Employment has announced its plans to conduct checks on chemicals. For these checks, manufacturers of glue, resin, and putty have been selected, as well as wholesalers of chemicals. For now, the inspections will be conducted via telephone.
The inspection of the Ministry of Social Affairs and Employment has targeted manufacturers of glue, resin, and putty as well as wholesalers of chemicals for new inspections. The aim is to check the extent to which employees are exposed to materials which promote the formation of cancer (carcinogens), materials which damage DNA (mutagens), materials which interfere with reproduction (reprotoxics), and materials which can induce allergies (sensitizers). The steps taken by the inspection are to examine the current situation, to assess whether or not the current approach suffices, to give advice on improvements, and to ensure the improvements will be implemented into the work method of the business.
For the duration of the coronavirus crisis, the inspections will be conducted via telephone. Businesses will be asked to discuss the registration of chemicals, exposure assessments, the risk assessment & evaluation and plan of action, and the contract with the health and safety service. When the inspection via telephone does not provide the desired results, it can be decided that a visit to the business is necessary. Penalties may be imposed.
From now on, businesses can request even more corona support from the government. Amongst others, the target group for the TOGS scheme has been expanded, allowing more entrepreneurs to receive a one-time gift of €4,000. And as of today, start-ups can appeal for a bridging loan.
The TOGS gift enables affected businesses to cover part of their running costs. The gift is connected to the so-called SBI-code representing the ‘main activity’ of a business and under which they are registered in the Business Register. The codes represent a specific business activity. Only certain sectors, such as the hospitality industry or retail, are eligible to receive the gift.
As of 29 April, it will also be possible to appeal for the TOGS gift on the basis of the SBI-code for ‘sideline activities’. The RVO, the institute responsible for executing the TOGS scheme, gives as an example a fashion designer who also runs a clothing store. The main activity, i.e. fashion design, is not eligible for the gift, but the sideline activity, i.e. retail, is. An appeal on the basis of a sideline activity is possible retroactively until 15 March 2020. The conditions which apply remain the same: the business must state that within the period between 16 March and 15 June it expects a loss in revenue of at least €4,000 whilst at the same time having €4,000 on fixed charges.
The Ministry of Economic Affairs will also expand various credit schemes. Amongst others, the state will stand surety for any loans taken out by businesses through the BMKB and GO schemes. For the BMKB, the entry barrier has been lowered and the duration of the loan has been expanded to four years. In the meantime, the European Commission has approved the announced expansion of the GO scheme, which can therefore go into effect on 29 April. Moreover, the Ministry of Economic Affairs will make €10 million extra available for the SEED Capital Scheme. Via this scheme, the government puts money into investment funds, which in turn support innovative enterprises.
As of today, start-ups and scale-ups can appeal to a Regionale Ontwikkelingsmaatschappij (ROM) for a bridging loan to survive the coronavirus crisis. These businesses usually have no credit relation with any bank, meaning that the BMKB and GO schemes are less useful to them. For this reason, the corona-overbruggingslening (COL) has been created. This allows start-ups and scale-ups to appeal to ROMs for a bridging loan. At the moment, approximately €100 million has been made available for these loans. Loans between €50,000 and €2 million have a 3% interest rate. For loans above €250,000, shareholders or investors are required to co-invest for 25%.
Almost two-thirds of small and medium-sized enterprises (SMEs) is expecting a substantial decline in revenue during March and April, as concluded by research centre Panteia after research into over 7,000 businesses. Thus far, financial institutions and accounting firms appear to be less affected by the coronavirus crisis than most other sectors.
Research by Panteia shows that freelancers are expecting the greatest decline in revenue: 67% in March and 71% in April. They do not have a lot of possibilities to save on costs and aren’t eligible to the majority of emergency schemes implemented by the government. Smaller SMEs report a decline in revenue of 53% in March and 60% in April. For larger SMEs, the numbers are 44% in March and 50% in April.
The impact of the coronavirus crisis is different per sector. The most severely affected sectors are amongst others: travel agencies (86% decline in revenue), the hospitality industry (82% decline in revenue), non-food agriculture, such as floriculture (76% decline in revenue), and non-essential health care, such as dentists and physiotherapists (70% decline in revenue).
There are also sectors less affected by the crisis, yet still suffering a loss in revenue in April. These include amongst others: financial institutions (31% decline in revenue), construction (20% decline in revenue), and accountants and lawyers (30% decline in revenue).
About 70% of businesses currently uses or is expected to use one or more support schemes by the government. The most used schemes are a deferral of tax payments and the NOW. Both are used by approximately 40% of businesses. In addition, over 25% uses the TOGS: the one-time gift of €4,000 to cover part of running costs. And over 12% uses the temporary scheme for self-employed entrepreneurs (TOZO) and/or the expansion of the Bbz-scheme.
Appropriate leadership is required more than ever now that the coronavirus crisis is causing the boundary between work and private life to disappear for employees. The original advice of asking your employees more often ‘how things are’ is no longer sufficient.
In the office, employees are occupied with work-related tasks, there is direct contact with colleagues and supervisors, the workplace meets all ergonomic requirements and is full of like-minded people. This all forms a sharp contrast with home, where there are pets, children and spouses working from home, which could all be a massive distraction. Some are driven crazy by the impossibility of having to work while taking care of the children while others face the threat of loneliness due to the lack of colleagues. Whatever it is, work is affected.
The Erasmus University in Rotterdam has researched how happy the Dutch have felt since the start of the coronavirus crisis, and in only a few weeks the ‘happiness score’ has dropped from 7.5 to 6.3. The largest loss in happiness is found amongst employees on a temporary contract and freelancers (cause: uncertainty about income) and people with children living at their parent’s house (cause: the impossible combination of working and taking care).
Figures published by the Netherlands National Centre of Stress and Burn-out Prevention (NCPSB) show that the stress level amongst employees compelled to work from home has increased by 40%. For this reason, employers are advised to adjust targets, to take it down a notch, and to realised that employees will be under a lot of pressure for a longer period of time. This all requires leadership which focuses more on soft skills, e.g. understanding that family life reduces or even completely ceases the productivity of employees. Such leadership will reduce stress and increase engagement. However, employees without family life must not be forgotten, since they often have a harder time to call it a day due to a lack of family structure or office hours. And finally, there is the group of employees who lack any self-discipline and benefit greatly from supervision and control.
Make adequate adjustments: some employees may be complete immersed in work, whereas others have a lot of time at hand at the moment. Therefore, frequently check what your employees are doing and re-distribute tasks if necessary. Lonely employees will greatly appreciate this contact, especially contact by telephone, and for overburdened employees these moments are perfect to signal if they can still cope. Make sure to check whether or not there are any problems and if everyone understands what is expected of them. Be clear on agreements before your employees start working on their tasks, i.e. deadlines, what is to be done, who does what, etc., and don’t forget to ask if they will manage.
Furthermore, point out to employees that they can always talk to the confidential counsellor (vertrouwenspersoon in Dutch). After all, there are things employees rather not tell their manager for fear of losing their job, out of shame, or simply because they don’t like to complain. And one final tip: be honest and tell employees this situation is also new to you, as this will grow sympathy and create frankness.
The Dutch cabinet will cater to director & major shareholders (dga’s in Dutch) who have been affected by the coronavirus crisis with two measures. First, they will be allowed to adjust their customary salary to the loss in revenue. Second, the announced levy on high debts in their own company will go into effect a year later: in 2023 instead of 2022.
The existing supportive measures already contain several measures which are available to director & major shareholders, such as the TOZO and the deferral of tax payments. However, the new supportive measures contain specific solutions for director & major shareholders.
The first deals with the customary salary. This is the salary a director & major shareholder must include in the payroll tax return. In determining what is ‘customary’, a director & major shareholder must look at the salary of employees in the ‘most similar employment’. In principle, the revenue does not play a role here. So when the revenue is low, the director & major shareholder must also pay payroll tax over the full sum of the customary salary. In a letter to the Dutch government, state secretary Hans Vijlbrief has mentioned that this is a burden to some industries, which see their revenue plummet due to the coronavirus crisis. For this very reason, director & major shareholders who see their revenue over 2020 decrease are allowed to include a lower customary salary in their payroll tax return. This lower salary is then related to the amount of revenue. The details of this scheme are still to be announced, but a similar scheme was implemented in 2009. Then, director & major shareholder could calculate their customary salary over 2009 as follows:
Customary salary of 2008 x (revenue in the first half of 2009 divided by revenue in the first half of 2008).
At the time, extra conditions did apply to the scheme. Amongst others, the lower customary salary could not lead to a higher dividend or a higher debt for the company.
The second measure deals with the announced levy on ‘excessive’ loans by director & major shareholder from their own company. In the eyes of the cabinet, these loans allow director & major shareholders to postpone tax payment for too long. For this reason, a ‘limit amount’ has been proposed. When the loan by the director & major shareholder and the partner exceeds €500,000, the sum of money above this limit is automatically taxed in box 2 of the income tax. The only exception are debts for their own house.
The law was planned to go into effect in 2022, however the bill has been delayed for some time now. The cabinet has therefore decided to postpone the implementation of the law to 2023. This will give director & major shareholders more time to anticipate to the limit amount. The Belastingdienst will start assessing the height of debts on 31 December 2023. According to Vijlbrief, the bill will ‘shortly’ be read by the Dutch lower house.
The tax-free expenses in the Work-related Expense Scheme are temporarily set at 3% of the first €400,000, as written by state secretary Vijlbrief of the Ministry of Finance in a letter to the Dutch lower house.
In order to help employers who find themselves in trouble because of the coronavirus crisis, the government will increase the tax-free expenses in the Work-related Expense Scheme (vrije ruimte in de Werkkostenregeling in Dutch) to 3% of the first €400,000 of an employee’s wage bill. This one-time increase is temporary and only in effect for 2020, as written by state secretary Vijlbrief of the Ministry of Finance in a letter to the Dutch lower house.
The increase should give employers the possibility to cater to their employees a little extra during these difficult times, for instance by giving them a flower bouquet or a gift voucher. The government also expects the increase will boost industries suffering the most at the moment.
The Work-related Expense Scheme enables employers to use a percentage of the total taxable wages to provide tax-free compensations, provisions or facilitations to employees. This percentage was already increased from 1.2% to 1.7% on 1 January 2020. Above €400,000, tax-free expenses are still 1.2% of the total amount. When an employer offers more tax-free expenses to his/her employees than permitted, the former must pay 80% tax over the excess. Employers are free to decide whether or not they want to provide tax-free expenses as well as the nature of these expenses.
Many offices and businesses are closed for an extended period of time now. Some make a virtue of necessity and commit to chores which had to be done for some time. However, also the workmen who come to do these chores do their work differently.
At the moment, most office buildings are occupied by only a small staff or are even entirely empty. The perfect moment to see to long overdue chores, such as fixing that leaking tap or having that paintwork done. And of course it may turn out that e.g. the boiler or the servers need some emergency maintenance. Whatever it is, all these chores require someone to come and do them.
Specifically for working with the coronavirus around, the Construction and Building Services Engineering industry has made a new approach available to its members. Anyone who engages in on-site working activities is advised the following:
In addition, every workman must adhere to the usual coronavirus measures: no shaking hands, regularly washing hands, coughing and sneezing in the inside of one’s elbow, and staying home when having mild symptoms. This set of measures should ensure safe working on site.
Once again, the Dutch cabinet is trying to reduce the suffering of tax payment during the coronavirus crisis. Amongst others, the Belastingdienst will show more leniency towards the so-called urencriterium, the minimal number of hours devoted to a business, and businesses may offset the loss over 2020 against the profit of 2019. House owners may also pause the payment of their mortgage debt for half a year.
The three measures mentioned above are part of a new set of fiscal support. It also includes an increase of tax-free expenses in the Work-related Expense Scheme (vrije ruimte in de Werkkostenregeling in Dutch) as well as support for director & major shareholders (dga’s in Dutch).
The leniency towards the urencriterium is mostly beneficial to freelancers. The urencriterium demands that entrepreneurs devote at least 1,225 hours per year (23,5 per week) to their business. Only then are they eligible to various entrepreneurial tax credits, such as the self-employed tax credit. However, now with the coronavirus crisis, many entrepreneurs will not make the urencriterium. State secretary Hans Vijlbrief finds it ‘unacceptable and unjust’ that many entrepreneurs lose their tax credit(s) this way. For this reason, the Belastingdienst will assume that in the period from 1 March to 31 May entrepreneurs will devote 24 hours to their business, even when this is factually not true. The state secretary will arrange an additional regulation for seasonal businesses with a peak in business in a different period.
Moreover, the state secretary will ensure companies can offset the loss over 2020 for the purpose of corporate tax at an earlier stage. Companies who suffered a loss can offset it against the profit in the previous year. However, this is only possible in the 2020 corporate tax return, which can be filed at the start of 2021. To give companies a little bit of breathing room at an earlier stage, they are allowed to create a ‘corona reserve’. This reserve is the expected loss related to the coronavirus during the year 2020. Companies can offset this amount against the profit of 2019 and reclaim paid corporate tax. The calculations can be based on a further provisional assessment, which can be provided by the Belastingdienst on request. The corona reserve may not be higher than the profit in 2019.
The state secretary is also taking action for home owner struggling to pay off their mortgage debt. With the bank, they can negotiate a 6 month pause for their payments. The payments, which also includes interest payments, can be caught up at a later stage. According to the law, home owners who negotiate a pause could lose their right to a reduction in mortgage interest (hypotheekrenteaftrek in Dutch). For this reason, the state secretary has approved the regulation that the paused payments can be caught up at any time during the term of the mortgage. In addition, home owners may split the paused payments off from the mortgage and arrange a separate payment for these. The approval is applicable to pauses in payment requested between 12 March and 30 June 2020. The pause must go into effect on 1 July the latest.
The state secretary is also looking into the possibility to apply this rule to mortgages taken out for a company or with a family member.
The coronavirus crisis causes many people to lose their job. However, some employers are actually looking to hire extra employees at the moment. In order to provide more insight into supply and demand on the labour market, the platform NLWerktDoor has been launched.
The coronavirus crisis has caused work in many industries to forcefully come to a halt and many jobs are at risk of disappearing. At the same time, however, there are also industries eager to employ extra personnel. These include the (health) care industry, logistics, and agriculture. For this reason, a cooperation of public and private parties has create the platform NLWerktDoor. The platform is intended to keep people employed and provide enough personnel to the various industries to prevent a loss of certain services and/or products. However, the platform is not only for employers looking for extra employees; it is also designed for jobseekers and organizations looking to loan out staff or cooperate with another organization. Furthermore, the platform also offers information to employers about internships during the coronavirus crisis.
Employers seeking for extra personnel can report this on NLWerktDoor. The platform sends the employer’s request for personnel to one of 35 regional employer service points. This service point will then match the job vacancy to jobseekers. Employers who are looking to loan out staff or materials or who are seeking a cooperation with other organizations can also register with the platform. The latter will take stock the supply and pass the information on to organizations for which this could be of interest.
Previously, several industries had already taken initiatives to recruit extra staff. Now, NLWerktDoor unites these regional or industry-based initiatives so that they can be found in one place. The platform is a national cooperation between the ministries of Social Affairs and Employment, the ministry of Education, Culture and Science, the UWV, municipalities, trade unions, and employers’, educational, and deployment organizations.
Since last year, public and private parties within the 35 labour market regions are working together to provide more perspective on work. The aim is to assist people who are willing and able to work but need help in finding work. Now, during the coronavirus crisis, this cooperation has been expanded through NLWerktDoor.
Because of the coronavirus crisis, employers may have to adjust the Risk Assessment and Evaluation as well as their plan of action; especially in the context of employees returning to the work floor. The Works Council has the right to vote on all adjustments pertaining to working conditions.
The works council and the policies on working conditions go hand in hand. The council’s right to vote on matters pertaining to working conditions can be found in the Works Council Act (WOR), article 27 clause 1d. This includes the preparation, change, or revocation of the Risk Assessment and Evaluation (henceforth RA&E) as well as the plan of action. For each adjustment, the employer must ask the works council for approval. Employers may be forced to adjust the RA&E when conditions within the organization change, for example:
The works council also has the right to vote on the plan of action, which is part of the RA&E. For the plan of action, it is important to know who is responsible for which improvement, what authority and means are available, and in which way the result will be assessed. The right to vote also applies to the bulk of the implementation measures the employer wishes to take based on the plan of action. These include measures in the following areas:
Every organization investing or intending to invest in sustainable sources of energy is entitled to the SDE+ subsidy (Stimulering Duurzame Energie). Of course, something has to be given in exchange: eventually the subsidy must result in a realized plan for which there is a deadline. However, this deadline is now less strict due to the coronavirus crisis.
The SDE+ subsidy has been created to stimulate the production of sustainable energy in both profit and non-profit organizations, with the exception of the government. This includes the investment in solar panels and wind turbines, but also the production of renewable electricity, gas, heat, or a combination of renewable heat and electricity. All projects subsidized by the SDE+ subsidy have a deadline. This is the final date at which the project must have been realized.
Because of the coronavirus crisis almost all SDE+ projects have been delayed, for example due to a longer delivery time of products or a lack of manpower. Moreover, the capacity of the electrical grid to transport electricity is also reduced. For this reason, minister Wiebes has proposed to exempt all delayed projects with a deadline in 2020 for one year, provided that the cause for the delay is beyond the power of the organization. This will allow organizations to better distribute their manpower and gives them time to do something about the reduced transport capacity of the electrical grid. The only condition applicable to the exemption is that the respective project can be realized with the extra year.
Organizations are not exempted automatically: instead, they must apply to the Netherlands Entreprise Agency for an exemption via firstname.lastname@example.org, citing the SDE project number. Do not forget to mentioned that it is possible for the project to be realized within the extra time that is applied for.
People are working from home and are trying to stay inside their houses as much as possible: a scenario that will probably continue for some time. Besides the question of whether or not people with office jobs exercise enough, there is now the added issue that with all this working from home and staying indoors people miss out on exercise in general, which affects their stamina.
With the ‘lockdown’ in place, employees have no possibility anymore to do their regular exercise routines. The gyms have closed, all football activities are cancelled and the water in swimming pools hasn’t been touched by any swimmers in weeks. Most employees spent their entire day working behind a laptop, making it quite the challenge to stay fit. The two most immediate consequences of less exercise are a loss in stamina and an increase in weight. The longer the situation continues, the harder it gets to ‘regain’ any losses.
It is therefore crucial for an organization to draw attention to the importance of exercise and assisting employees in doing so. Organizations can give employees a number of exercises which they can easily do at home or organize an ‘online exercise group’. In addition, organizations should encourage employees to go for a little walk every day when it is safe to do so – or a very Dutch alternative: go for a little bike ride every day.
According to pension provider BeFrank, people currently exercise on average two hours less than in the normal situation. When looking at the figures, this amounts to 40% less time spent on exercising. 33% of people don’t even exercise at all at the moment, which is an increase of 8% compared to the normal situation, according to BeFrank.
The Dutch cabinet has announced several adjustments to the emergency measures. Amongst others, the NOW will become available to businesses with a loss in revenue of less than 20% and a special regulation will be created for seasonal organizations.
The last few weeks, the Dutch cabinet has implemented a wide range of emergency measures to combat the financial consequences of the coronavirus crisis. Amongst others, these measures are intended to enable employers to continue the payment of salaries to their employees. Yesterday, minister Koolmees and state secretary Van Ark of the Ministry of Social Affairs and Employment publish an official letter to the Dutch lower house explaining a few important adjustments to the emergency measures.
Independent members of a concern will be able to apply for the NOW individually, even when the concern does not see a loss in revenue of at least 20%. However, conditions apply. Concerns where the operating subsidiary applies for the NOW must declare to refrain from paying dividends and bonuses or buying back own shares in 2020. Moreover, operating subsidiaries with 20 or more employees must sign an agreement with the trade unions on preservation of employment in the respective subsidiary. For subsidiaries with less than 20 employees, an accord by employees’ representatives suffices. Furthermore, additional accountancy checks are also required.
The cabinet is looking into the possibility for additional support for flextime workers who have lost their jobs since 1 March but are not entitled to a benefit. The cabinet is in discussion with the UWV and VNG, the institutions which will likely be in charge of the additional support.
The cabinet is also thinking about a solution for seasonal organizations. For these, the NOW is not always the answer. For organizations whose business depends on the seasons, a separate regulations is required. However, the cabinet has stated they consider such a regulation a ‘complex challenge’.
For 2020, employers do not have to revise the low WW-premiums when they pay an employee for 30% more working hours than in his/her contract (30%-herzieningssituatie in Dutch). Since 1 January 2020, employers must pay a low WW-premium for employees with permanent contracts/employment and a high WW-premium for flextime contracts. However, when an employee with a permanent contract works 30% more hours than in his/her contract, the employer must still pay a high WW-premium for that employee. In sectors where employees currently work a lot of overtime due to the coronavirus, for example the (health) care industry, this rule has unintended consequences. For this reason, the cabinet has decided to suspend the rule for 2020 for all employees.
Because the (now superseded) short-time working regulation causes the salary of employees to be reduced, it is possible businesses employing skilled migrants no longer meet the salary criterion (salariscriterium in Dutch). The employer can then face a penalty. However, because of the exceptional circumstances, the cabinet has decided to suspend all legal actions in such a situation.
The exact date on which Ramadan starts is different each year and officially depends on the position of the moon. This year, Ramadan is set to begin on Friday morning 24 April and will end on Saturday morning 23 May. It is a special month in which Muslims worldwide fast from dawn to dusk. There are several different ways in which employers can support their fasting employees.
Ramadan is the Islamic month of fasting, set this year to begin on 24 April and end on 23 May. During Ramadan, Muslims refrain from eating, drinking, smoking, and sexual intercourse from dawn to dusk. All this is done instead in the intervening period, which could result in fewer hours of sleep. The time fasting begins and ends each day is different every day.
The measures against the coronavirus will cause Ramadan to be very different this year because all gatherings are prohibited until 1 June. For this reason, the iftar – the evening meal which ends the fasting each day and often involves a lot of people together – will also be different. The same rules apply to Ramadan as to everyday life: follow the advice of the government and stay home as much as possible.
Fasting and a lack of sleep can result in concentration problems. Ramadan can therefore have an impact on the performance of employees. For professions which involve heavy labour or the operation of machinery, this could even lead to dangerous situation. Supporting fasting employees is therefore also in the interest of the organization.
Examples of action which employers can take to support their Islamic employees during Ramadan are:
The Dutch law says nothing about Ramadan. Eid al-Fitr, the festival which marks the end of Ramadan, is therefore no official holiday. However, as part of good leadership and according to the law (i.e. the Working Conditions Act), every employer is required to ensure safe working conditions. When necessary, the works council can point the employer to action (s)he can take as well as emphasize the importance of it.
The government is carefully relaxing the measures in place to contain the coronavirus. Primary schools are to be opened again, but for e.g. the hospitality industry the lockdown will remain in place. Employers’ organizations have therefore argued for new round of corona support for businesses.
Some peace will finally arrive for employees with young children who have spent the last few weeks working from home. Primary schools and daycare facilities will open again on 11 May, although the size of school classes will be halved. Secondary schools are expected to open again on Tuesday, June 2 (after Pentecost). Furthermore, children up to 12 years of age no longer have to spent their days jumping on your expensive sofa to lose their energy: on 29 April they can play sports in a groups again, although official matches are still not permitted.
Although less severe thus rules apply to children, for many others the rules have not been relaxed at all. For example, the government has decided to not lift the mandatory closure of e.g. bars, restaurants and barbershops. For them, the lockdown will remain in place until 19 May. Events are even forbidden until 1 September 2020.
According to the employer’s organizations VNO-NCW and MKB-Nederland, more and more businesses are running out of money and the situation is turning for the worse. They therefore argue for a second package of emergency measures to help out businesses for longer. For now, the deadlines for several important support measures are as follows:
Chances are that additional conditions apply to a new round of support measures. It has already been proposed to prohibit the payment of dividends for businesses that receive support. Last Tuesday, minister Koolmees of the Ministry of Social Affairs emphasized that the government has purposely left room for adjustment of the conditions when the support measures are extended. Additional conditions may therefore be implemented.
Employers’ organizations hope that, based on the ‘1.5 meter protocols’ which have been prepared by various branches, some businesses can open their doors again the coming weeks. Many businesses have not been rewarded for preparing such protocols, which is a real ‘bummer’ in the eyes of the employers’ organizations. However, prime minister Rutte mentioned in his press conference that it is not that simple. Although a protocol is a requirement to be able to continue business, it is no free pass to actually open the doors again.
On its website, the UWV writes that the application term for a target group declaration of a labour cost compensation (LKV) has been extended by three months due to the coronavirus crisis.
In order to be eligible for a labour cost compensation (LKV), employers need a copy of the target group declaration (doelgroepverklaring in Dutch) from his/her employee. The employee must apply for the declaration him-/herself. Because of the coronavirus crisis, the employee now has three extra months to do so, making the total application term six months. This extension only applies to target group declarations for employees who entered employment between 1 January 2020 and 1 June 2020.
Under normal circumstances, an employee must apply for a declaration within three months after (s)he entered employment. However, because of the coronavirus crisis employees do not always manage to do so within that time span, since offices are closed or the employee is not able to sign an authorisation for his employer to apply for the declaration.
The labour cost compensation (LKV) – together with the low-income compensation (LIV) – is a compensation based on the Wet tegemoetkomingen loondomein (WTL), the Wage Compensation Act. Employers are entitled to receive a labour cost compensation for employees when the latter met several requirements in 2019, of which one is the application for a target group declaration. The target group are those employees in a vulnerable position, who can be divided into three categories:
The employers must keep a copy of the target group declaration in the salary administration. The labour cost compensation is only calculated and paid at the end of the calendar year.
The mandatory working from home does come at a price, as it leads to more stress in many instances. For this reason, it is recommended to keep in touch with employees who are working from home. When someone is not taking it any more, help can then be offered in time.
The current situation in which employees work from home appears to lead to a lot of stress. Employees face many things at the same time, as they not only have to do their work but also have to provide home education to their children. Some even have to take care of their relatives. And of course, many are worried about their future. All together this appears to have lead to a 40% increase in stress, as stated by the Netherlands National Centre for Stress and Burn-out Prevention (NCPSB).
According to the NCPSB, this can lead to a critical situation. When such percentages remain the same for several months on end, they could result in a burn-out. As the lockdown continues, it becomes more important to support employees in order to prevent a dropout. Of course, there isn’t much an employer can do about the duration of the lockdown or provision of home education, but it already means a lot to people when they can blow off steam. This is where the employer can step in, together with help from the working conditions professional, a councillor, the human resources professional, the occupational physician and the prevention officer. Any concerns employees have about the working conditions can also be shared with the works council.
Before the coronavirus outbreak, the NCPSB had measured the level of stress among 684 professionals with different levels of education, which turned out to be a good baseline. A second measurement of 198 professionals with similar levels of education, conducted after five weeks of mandatory working from home, shows a 40% increase in stress levels amongst those working from home.
Governments worldwide are reaching deep into their pockets to get businesses through the coronavirus crisis. However, in the meantime there are also calls to attach extra conditions to this financial support. For example, Denmark excludes ‘tax dodgers’ from such support. Also in the Netherlands, there are calls for a more critical stance.
Throughout the world, governments are spending billions on saving businesses and jobs from their demise. Also in the Netherlands, the government has reached deep into its pockets for financial support, for example by assuming wage costs through the NOW regulation or by granting financial benefits to self-employed individuals through the TOZO regulation. The news channel RTL Nieuws estimates the total amount of financial support so far at over €19 billion.
Businesses are pleased with the generous and quick-to-arrive emergency support, but slowly this generosity is now disappearing and changes to eligibility are implemented. Denmark has now decided to exclude businesses registered in ‘tax havens’ from any financial support and businesses that do receive financial support from the government are prohibited from paying dividends to their shareholders in 2020 and 2021. With these measures, Denmark hopes to ensure the money received as support is also really used to preserve jobs and businesses. For the decision whether or not a business is excluded from support, Denmark uses the list of ‘non-cooperative jurisdictions’ composed by the EU. There are currently 12 countries on the list, including Fiji, Panama, and the Cayman Islands. Before Denmark, Poland had already implemented a similar restriction on financial support.
Also in the Netherlands, there are calls to attach extra conditions to any new financial support. The political parties GroenLinks and PvdA have argued for an implementation of the same measures as in Denmark to ensure financial support does not end up in the dividends paid to shareholders. They also want agreements on sustainability. The cabinet has made it known that extra conditions are possible, as extra conditions have already been attached to the expansion of the NOW regulation.
In the meantime, the Dutch government has already made an ethical appeal to businesses on multiple occasions to not misuse the financial support. During the creation of the supporting measures, focus has been on a quick implementation rather than security features to prevent fraud. Nonetheless, the inspection of the Ministry of Social Affairs and the Fiscal Information and Investigation Service (FIOD) are working together to track down and prevent fraud with the financial support.
The wage cost subsidy for employees limited in their ability to work is not offset against the compensation received through the NOW regulation. This was mentioned by State Secretary Van Ark of the Ministry of Social Affairs and Employment in a response to questions by the Dutch lower house.
The Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid – the NOW regulation – compels employers who receive a wage cost subsidy to report the NOW compensation to the municipality from which they receive the wage cost subsidy. The municipality would then offset the wage cost subside against the NOW compensation. However, State Secretary Van Ark of Social Affairs and Employment has decided not to take any further steps to make the offset possible, as mentioned in a response to questions by the Dutch lower house. There is therefore no need any more to compel employers to report the NOW compensation to the municipality.
Offsetting the wage cost subsidy with the NOW compensation was meant to avoid double financing for wage costs of employees limited in their ability to work, but turns out difficult to implement. For this, drastic adjustments are necessary in the implementation system of municipalities; and those adjustments incur extra costs.
By abolishing the offsetting of the wage cost subsidy against the NOW compensation, double financing for wage costs of people limited in their ability to work is accepted during the coronavirus crisis. This is supposed to avoid unease with employers who employ people limited in their ability to work. These employers may also continue to use extra provisions meant for employees limited in their ability to work, such as a no-risk insurance policy. Moreover, the State Secretary thinks it is important that supportive measures, such as a job coach, also remain in effect.
Various branches have come up with ideas as to how they plan to open their doors in the ‘1.5 meter society’. It has become apparent that this is neither a piece of cake nor very profitable for entrepreneurs. In general, employers must think about a post-coronavirus restart, given that the average office landscape is not designed for a separation of 1.5 meters.
As part of the coronavirus measures, many businesses including hospitality businesses and travel agencies have been compelled to close their doors. Before these industries can open again, they must first hand in protocols with the government. These will show how businesses will implement the rules for keeping distance and hygiene. A government committee is in charge of approving the protocols.
Dealing with the ‘1.5 meter society’ is quite tricky for some industries. The hospitality industry even deems it ‘not workable’, as mentioned by the hospitality industry trade association Koninklijke Horeca Nederland (KHN). Bars will ‘fill up’ quickly when everyone must keep a distance of 1.5 meters. This way, not make a lot of money can be made. The trade association has handed in a concept for a protocol, but wants additional supporting measures from the cabinet.
Dentists have finished their protocol to re-open; barbershops are working on it. And also e.g. NL Actief, the trade association for fitness centers, has prepared a concept for a protocol. Amongst others, this includes the rule that only 1 person can be present per 10 m2 and members are forbidden from using the showers on the premises. Furthermore, for industries which continue to run, such as shops and corporate services, protocols exists to continue business ‘responsibly’.
Organizations with employees working in offices have yet other concerns. Many employees have spent the last couple of weeks in their home offices, but what should be done when offices slowly open again? And then there is the question of whether or not employees using public transport can come or not.
In the average office landscape, the distance between desks of direct colleagues is far from 1.5 meters. Letting all employees return to office at once is therefore not possible. Options include splitting staff in teams or letting team members alternate between working from home and working at the office. Anyway, the employer him-/herself must come up with a protocol. Also, the risk assessment and evaluation has to be extended to include the risks the coronavirus brings along and how the employer deals with them. The works council or employee representatives have to approve such a change in the area of working conditions.
The works council of online travel agency Booking.com is worried about the protection of employees. Because revenue has dropped dramatically due to the coronavirus crisis, management has not ruled out the possibility of dismissals. The organization lacks a social plan, however.
According to the works council, Booking.com is not doing enough to secure the future of the organizations and to protect its employees. This was announced by the works council to the management last Friday. Because of the dramatic drop in revenue – the result of the coronavirus crisis – CEO Glenn Fogel cannot rule out the possibility of redundancy. Last weeks, it was made public that Booking.com is using the regulation Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW). The employer must inform the works council on the NOW regulation. This subsidy regulation provides a compensation of max. 90% of wage costs for three consecutive months when an organization suffers from a severe loss in revenue as a result of the coronavirus crisis.
One of the conditions of using the NOW regulation is that the employer may not dismiss any employees for business-economic reasons during the term of the subsidy. When dismissal do happen, the amount of subsidy will be decreased. Moreover, an employer who dismisses personnel must establish that the dismissal(s) cannot be avoided using the NOW regulation. The UWV – the Dutch Institute for Employee Insurance – will thus include the NOW regulation when assessing a dismissal.
The works council has the right to advice for dismissals happing for business-economic reasons (article 25, clause 1 of the Works Council Act). The UWV will only process a request for dismissal when the works council has been consulted. The works council of Booking.com is mostly concerned about the lack of a social plan. In a social plan, an employee must record with which measures (s)he mitigates the consequences for employees. A good severance package, for example. For the preparation of a social plan, the works council also has the right to advice.
Online travel agency Booking.com is originally a Dutch business. Since 2005, it is American hands. About 5,000 employees work for the branch in Amsterdam. As a result of the coronavirus crisis, the travel industry has been halted almost entirely and Booking.com saw its revenue plummet by 85% compared to last year.
At the moment, 622.780 Dutch businesses are in the danger zone as the result of the measures implemented because of the coronavirus. That is 1 out of 5 businesses, as shown by a calculation by business information specialist Graydon.
The data analysts of Graydon have provided insight into the financial well-being of businesses before and after the first measures implemented by the Dutch cabinet. The calculation also shows that of all businesses which could be labeled as financially ‘healthy’ in February 2020, 16.5% is currently facing severe problems.
It is not surprising that of all industries, the hospitality industry is affected the most. 73% of all businesses in this industry are affected above average. This is one of the consequences of the mandatory closure of all food and drink facilities until at least April 28. The transportation and logistics industry also suffers severely because of the coronavirus crisis. In this industry, 39% of all businesses are affected.
The coronavirus measures also have a lot of impact on the culture, sport and recreation industry (38%) and remaining services (37%), including barbershops and beauty parlors. However, there are also industries where the measure have had a lesser impact so far, such as the extraction of minerals, agriculture & fishing and the (semi-)government.
Graydon made use of a new model for its calculation. Traditional parameters like profit and solvency cannot be used at the moment for the calculation of financial well-being. They are based on the running economy. Now that some industries are halted and many businesses cannot perform optimally because its employees are working from home, Graydon has looked at the impact of the virus on businesses. For this, they used industry characteristics, payment behavior, the (international) network of relations, the size of the business and up-to-date data from the Netherlands National Institute for Public Health and the Environment (RIVM in Dutch).
The Dutch lower house has passed two resolutions intended to make the cabinet examine the possibility for a temporary increase in the loss relief for corporate tax. This should lead to more financial breathing room for businesses.
Currently, businesses that must pay corporate tax can offset losses of one year ago and six year ahead. Because of the coronavirus crisis, many of these businesses are facing losses this year. The Dutch lower house wants to help these businesses and has therefore asked the government to examine whether or not an increased loss relief can improve the liquidity of Dutch businesses.
In addition, the Dutch lower house has also requested an examination of the possibility to have businesses that must pay corporate tax file their corporate tax return for 2020 already based on an estimated profit and loss account. The estimated loss that follows from that account can then be offset against the profit of 2019.
At the moment, when a business that must pay corporate tax has suffered a loss which it wants to offset against the profit of a previous year, the business does not have to wait either until the Belastingdienst has finished processing the tax return of the year the loss was suffered. When the business files its tax return, it can appeal for a provisional loss relief. The tax authority will then determine the provisional loss relief with an official decision. The following conditions apply:
Of the loss filed by the business, max. 80% is offset.
When an employee requests to work more or fewer hours because of the coronavirus crisis, then in most cases the employer cannot decline the request. The Wet flexibel werken (Flexible Working Act) plays a pivotal role here.
Because of the coronavirus crisis, an employee may feel the desire to work more or fewer hours. For this, the employee can file a request with his/her employer. For such a request, the employee and employer must first come together to discuss and see if they can find an alternative solution which works for both. When no such solution can be found, the law steps in; and primarily the Wet flexibel werken (WFW) – the Flexible Working Act. The WFW regulates that, in principle, an employee has the right once a year to file a request for an increase or decrease in working hours. The adjustment can be temporary or structural. The employer must accept a request pursuant to the WFW, unless there are ‘compelling business or service interests’ (article 2, clause 9 and 10 of the WFW shows several examples). However, the latter is difficult to prove. At the most extreme end, a judge can be involved to give a verdict.
The employee must file a written request for an adjustment in working hours two months before the intended starting date at the latest. Subsequently, the employer must answer to the request in writing one month before the starting date at the latest. When the employer forbears to do so, the request of the employee is automatically granted.
An employee is only allowed to file a request for an adjustment in working hours when (s)he has been employed by the organization for at least 26 weeks when the requested adjustment is intended to go into effect, unless various ‘unforeseen circumstances’ apply. An employee who has reached the age at which (s)he is eligible for an AOW benefit cannot file a request pursuant to the WFW either. Furthermore, the WFW does not apply to organizations with fewer than 10 employees. Such organizations must make their own arrangements regarding requests by employees for adjustments in working hours. And finally: in a CLA or regulation by the works council or employee representatives, different agreements may have been made on various parts of the WFW.
Now that it has become apparent that working from home will be the norm for the time to come, inspectors from the Ministry of Social Affairs and Employment will make more home visits to check home offices. They are legally permitted to do so. Therefore, make sure that the home offices and workplaces of your employees meet all the requirements set out in the Dutch Working Conditions Act (Arbowet).
Organizations must provide healthy and safe workplaces for their employees, both at the office as well as at home. To check whether or not organizations take their responsibility, inspectors from the Ministry of Social Affairs and Employment can come knocking at the door. They are charged with checking organizations for compliance with the Working Conditions Act and must be given access to the office building, the workplaces and all other areas the inspector wishes to check. This can also be a home office. The inspector is authorized to access all places your employees are working from. Office spaces, the factory hall and trucks or other modes of transport jump to mind first. But, as mentioned before, a workplace at home is also included in the list.
Despite the fact not all employees working from home are thrilled about a visit from the inspector, they aren’t permitted to refuse giving the inspector access to their home office. The Working Conditions Act authorizes inspectors to see the homes of employees working from home, even when the employee does not give permission for this. Of course, a home is still a private space. For this reason, despite having authority, the inspector is not free to do anything:
The obligations of an inspector and his/her conduct during the check are described in the code of conduct of the Inspection for the Ministry. As mentioned in the code of conduct, inspectors must think thoroughly about the penalty they will impose for violations. Of course, an inspector is not authorized to impose a disproportionately high penalty just for getting out of bed on the wrong side or because (s)he does not like the employee.
Every year, the annual report and the financial statements give an overview of the state of affairs in a business Because the coronavirus raises a lot of questions about the way businesses should prepare the financial statements, the annual report of 2019 as well as expectations for the future, the Raad van de Jaarverslaggeving – an advisory body for annual records – publish several points of attention.
In the statement RJ-Uiting 2020-05, published in response to the coronavirus, the Raad van de Jaarverslag has described the situation for legal entities with financial years which ended on December 31, 2019, the balance sheet date. The coronavirus crisis started in December 2019 in China and has only began to affect most businesses in the course of 2020. These effects are after the balance sheet date and therefore do not have to be incorporated in the financial statements of 2019. Depreciation of fixed assets, stock and debtors which only occurs in the course of 2020 is thus not included in the statements of 2019. There is some time between the preparation and determination of the annual records. The financial statements do not have to be adapted to the developments within that time span.
There is an exception: when it is already crystal clear that the business will be terminated in 2020, the financial statements of 2019 must be prepared on grounds of liquidation and termination of the legal entity. Even when in the period between the preparation and determination of the annual reports developments cause a termination of the business to be unavoidable, the annual report of 2019 must nonetheless be prepared on grounds of liquidity.
It has already been established before that annual reports must contain a section devoted to the continuity and future proof of a business. The Raad van de Jaarverslag emphasizes how especially now, during the coronavirus crisis, it is important to include a section which is devoted to the risks and uncertainties, the measures taken and prepared, possible state support and the expected impact on activities, liquidity, result and capital as a result of the crisis. Small-sized legal entities are not obliged to prepare an annual report; however, when they decide to do so, it is recommended they include the same points of attention on risks and consequences. Micro-sized legal entities are exempted from specific explanation in their annual records. Yet, when there is uncertainty about the survival of the micro-sized business, the Raad van de Jaarverslag is of the opinion that an explanation should be included.
The State Secretary of Finance has decided that employers can continue to reimburse a fixed amount for travel expenses tax-free. In addition, the Belastingdienst will temporarily be more lenient in the application of the anoniementarief (anonymous rate).
For as long as the coronavirus measures are in effect, employers may continue to pay a fixed reimbursement for travel expenses. For now, this is until April 28. The policy decision by the Ministry of Finance states that a changed travel routine of employees who work from home more often does not have any consequences for the reimbursement. The employer may continue to assume the details on which the fixed amount of reimbursement was based. The new, temporary rule also applies to fixed reimbursements with a subsequent calculation.
According to the normal rules, a reimbursement of travel expenses would no longer be exempt from tax when the employee is home for 6 weeks or longer. However, because of the decision by the State Secretary this isn’t the case anymore. Of course, an employer is allowed to decide to no longer pay the reimbursement, for instance because this saves money – unless this in incompatible with the agreed conditions of employment.
Furthermore, the Belastingdienst has announced it will be more lenient towards employer who, because of the coronavirus crisis, cannot meet certain administrative requirements concerning payroll tax. For instance, the anonymous rate (anoniementarief) of 52% which applies to the payroll tax when an employer does not establish the identity of a new employee in time, can be scrapped. Of course, employers must redress the shortcomings as quickly as possible.
Furthermore, State Secretary Vijlbrief of the Ministry of Finance has made agreements on payroll tax for cross-border workers during the coronavirus crisis. Employees who have to work from home because of the crisis can treat the situation tax-wise as if they are working at the office as usual.
Remaining in contact with colleagues has become a lot harder now that many employees are working from home because of the coronavirus. When there is no possibility for expensive video conference software, small-scale video conferences can easily take place via apps which most employees have already installed on their mobile phones. WhatsApp, Facebook or Facebook Messenger: what are the best apps for your organization?
In order to organize video conferences, your organization can chose between paid platforms such as Jabber and Slack, free conference software (Zoom, Skype, Google Meet and GoToMeeting) or apps which most employee are already familiar with in private settings. Popular apps like Whatsapp, Facebook Messenger and Facetime are often used to send messages, but video calling is also an option!
An advantage of using these apps is that employees are usually already familiar with them, which means it will not take long for them to get the hang of video conferencing. For one-on-one conversations, these apps are also useful. A disadvantage is that these apps are not designed for business-related use, which means that it is more difficult to share files, for example. Moreover, there is no possibility to share screens in order to show figures.
Using Whatsapp for a video conference is possible, but only for a total of four participants. You video call everyone from a group chat. Whatsapp ensures privacy using end-to-end encryption. The app Signal is also known for its attention to privacy. There is no profit motive and the source code is freely available, which means users can check if no data is being collected. Unfortunately, the app does not yet allow video calling in group chats.
Facebook Messenger allows a maximum of fifty people to participate in a video call. The first six participants are all visible on screen, but for calls with more than six people only the person talking is visible on screen. The downside of using Messenger is that employees need their Facebook account to log on. Perhaps this is not desirable in a business context. Facetime is an app for iOS-users. When all employees have a company iPhone, Facetime is a good option for a video conference. A total of 32 participants can join the video conference. However, when not everyone has an Apple phone, Facetime is not a suitable option because Android users do not have access to the application.
State Secretary Vijlbrief of the Ministry of Finance has made agreements on payroll tax for cross-border workers during the coronavirus crisis. Workers working from home because of the crisis can treat their situation tax-wise as if they are still working at the office.
The rules regarding the taxation of cross-border workers have temporarily been relaxed in connection to the coronavirus crisis. The relaxation concerns the payroll tax for employees living in the Netherlands but working for a Dutch organization in Germany or Belgium. Normally, the country where the employee is working is the one levying payroll tax. The country of residence is only permitted to levy tax on grounds of the so-called ‘183-days regulation’ (183-dagenregeling in Dutch).
Now that employees are home for a longer time, there may be a shift in the right to levy payroll tax away from the country they are working in and to the country of residence. This could possibly have negative consequences on income, uncertainty with the employee and an administrative burden for the employer. Therefore, the Ministry has discussed the situation with the governments of Germany and Belgium.
For cross-border workers, the Ministry of Finance maintains a distinction between those working from home and those who cannot continue their work and stay home with pay. For those working from home, the Netherlands and Germany have agreed to treat the days spent working from home as if no coronavirus crisis has happened. In other words, the days working from home are treated as days working in the country where the employee would work under normal circumstances. Here, the two countries deviate from the Tax Treaty between the Netherlands and Germany. The employer can nonetheless still appeal to the regular rules in the treaty, meaning that taxation will happen in the country of residence. The agreement is in effect from March 11 to April 30. Thereafter, the agreement is extended month by month until one of the countries steps out. The Netherlands is still in discussion with Belgium for a regulation.
For employees who must stay home without being able to work but with wages continued to be paid, the wages are taxed by the country the employee would work in under normal circumstances. This agreement applies to the Netherlands, Germany and Belgium. In addition, State Secretary Vijlbrief has decided that fixed reimbursement of travel expenses remains tax-free when employees must work from home due to the coronavirus measures. Moreover, the Belastingdienst will be more lenient in the application of the anoniementarief (anonymous rate) for the moment.
During the coronavirus period, the UWV – the Netherlands Institute for Employee Insurance – is still using expert judgments, but the consequences of the coronavrius measures can affect the content of a judgment. The UWV takes this into consideration for future judgments on re-integration.
The UWV is adjusting its methods because of the coronavirus measures. Before, the institute already stated in an appendix to the work guide Poortwachter that all UWV workers will take into consider the effects of COVID-19 on the organization and the re-integration of sick employees in an assessment of the reintegration efforts by the employer. This also applies when an expert judgment is requested. During the coronavirus period, an employer can still request an expert judgment, but the UWV will base the research as much as possible on documents and conduct it at distance. Moreover, it will not always be possible to arrive at a substantive judgment, for example because there is no in-person consultation hour with the insurance doctor. When this is the case, the UWV will not blame the employer in future re-integration assessments for not having requested an expert judgment with a stagnating re-integration during the coronavirus crisis.
For the assessment, it is important an employer sends all required documents along with the application form. In the form Aanvraag deskundigenoordeel door werkgever it is stated per situation which documents are required. The UWV will decline the request for an expert judgment when the employer does not, or not in time, send the information required. An employer can request the UWV for an independent expert judgment when the re-integration is halted, for instance when an employer and employee differ in opinion on the re-integration. The employee can also request an expert judgment. Such an expert judgment is not mandatory, but the result can help to get the re-integration back up and running. Also, the UWV includes the judgment in the re-integration assessment when an employee applies for a social benefit based on the Act Wet werk en inkomen naar arbeidsvermogen.
Right now, plans have to be made for when the coronavirus measures are relaxed. An employer might think of pre-emptive measurements of the temperature of his/her employees. But is this legal?
Employers have to think about concrete plans for when the coronavirus measures are relaxed and people will come back to work. This will be a set of measures. Some employers will consider the option to pre-emptively take the temperature of employees. This way, they hope to determine whether an employee has a fever and therefore possibly a coronavirus infection.
However, this is a bad idea for two reasons. First, taking temperature has only little predictive value. Experience from tests on passengers on airports shows that 46% of infected persons are not discovered by temperature measurements. There are various reasons for this, ranging from the moment during the incubation period the measurement is taken to incorrectly executed measurements.
The second reason is privacy. The Dutch Authority on Personal Information (Autoriteit Persoonsgegevens) imposes stricter requirements on employers who want to take temperature. Only three persons are permitted to do these measurements: the employee him-/herself, the occupational doctor or a health and safety nurse (arboverpleegkundige in Dutch). For this reason, both the health and safety services as well as the professional association of occupational doctors are holding back on such requests. During the coronavirus crisis, the employer is allowed to send employees home who have symptoms of a cold or fever.
State Secretary Van Ark of the Ministry of Social Affairs and Employment has given more clarity on the operation of the regulation Tijdelijke Overbruggingsregeling Zelfstandige Ondernemers (TOZO). An extension of the regulation will also follow. Entrepreneurs living in the Netherlands with businesses just across the border and vice versa will also be eligible for the TOZO regulation.
To be eligible for the TOZO regulation, a self-employed entrepreneur must live in the Netherlands and also have a business based in the Netherlands. Because of these stringent rules, entrepreneurs who live in the Netherlands but have their business across the border and entrepreneurs who live abroad but have their business based in the Netherlands miss out on the regulation. In a response to questions by the Dutch lower house, State Secretary Van Ark has stated that she will arrange for these ‘border cases’ to also be eligible for the TOZO.
The self-employed entrepreneur must also meet a minimum of 1,225 hours devoted to his/her business – the so-called urencriterium in Dutch ‒ in order to be eligible for the TOZO. This also applies to entrepreneurs who, next to their own self-employed activities, engage in work under employment. There are no exceptions. The earnings from work under employment are also included in the determination whether or not an entrepreneur qualifies for a benefit. This is because an entrepreneur is only entitled to a benefit when his/her total income does not exceed the social minimum.
Entrepreneurs can apply for the TOZO regulation from the age 18 until the age they are entitled to an AOW benefit (AOW-uitkering in Dutch). Self-employed with an AOW benefit are therefore not eligible for the TOZO, since they have reached the age of entitlement to an AOW benefit. A director & major shareholder is also eligible for the TOZO, but must include with his application a statement which shows that (s)he alone or together with other individuals working for the company possesses over 50% of shares.
These are difficult times for many charities. Because of the measures implemented by the government, a lot of organizations can no longer raise funds, must cancel events or are even forced to close their doors. According to a quick scan by Goede Doelen Nederland, 80% of charities see a reduction in income.
Just like many other organizations, the non-profit sector is affected by the coronavirus crisis. Goede Doelen Nederland, the branch organization for charities, has recently conducted a survey among its members. Many organizations (80% of respondents) already face a decline in income. About 77% of organizations have even indicated they aren’t certain if they can continue their activities in the future. The charities are expecting a decline of 10% to 30% in the budget for 2020.
Furthermore, charities have indicated that there may be large consequences for employment in the sector. The survey shows that two thirds of respondents fear the consequences of the coronavirus crisis for employment. Chances are that organizations will not extend temporary contracts, suspend work by self-employed individuals and not fill outstanding job offers for the time to come.
Three quarters of the surveyed non-profit organizations also believes the current crisis will have an effect on target spending. Charities have trouble to provide the desired help to vulnerable individuals and groups. Moreover, many research projects have been suspended. This all puts the target spending of charities under pressure.
The Dutch cabinet is implementing emergency measure after emergency measure to keep businesses running. A few measures have now been included in a policy decision, so that businesses have these promises officially on paper. The decision includes a series of approvals and the promise that arrangements are made to ensure the TOGS-gift of €4,000 is really tax-free.
A large set of emergency measures has been put on the table to guide the Netherlands through the crisis. For instance, the Dutch government will assume part of the wage costs of businesses through the NOW regulation. Also, businesses can appeal to the Belastingdienst for a deferral of payment and the government offers banks extra state guarantees on business loans.
In the meantime, such measures must also be officially documented as policies. State Secretary Hans Vijlbrief of the Ministry of Finance has now elaborated a series of measures into a policy decision. Amongst others, these include:
In the policy decision, Vijlbrief points to the so-called TOGS regulation. Via this regulation, affected businesses can apply for a one-off gift of €4,000 to cover part of running costs. This gift is not regarded part of a business’s profit and hence is exempt from corporate or income tax, as stated by the State Secretary before. In the policy decision, he mentions that this is arranged for with retroactive effect in the Tax Plan for 2021, which will be presented on Prinsjesdag (the 3rd Tuesday in September).
In addition, Vijlbrief emphasizes that adjustments in the provisional assessment for corporate tax can also be filed without eHerkenning. Instead, a form on the website of the Belastingdienst can be completed.
The Netherlands Organization for applied scientific research (TNO) has started research into the measures affecting organizations during the coronavirus crisis. The working conditions for employees are also included. An overview of advice and initiatives can be found of the TNO’s blog.
The coronavirus crisis affects the entire country. Organizations have to survive the crisis financially and many employees have worked from home for weeks on end. Via the app ‘How am I’, TNO is researching the working conditions, working experience and well-being of various groups. Moreover, interesting initiatives of organizations and measures which work well are also discussed. It may inspire others to apply these initiatives and measures to their own organization.
On the TNO’s blog, various results from the research, initiatives and advice can be found. Amongst others, you can read about managing employees working from home and positive developments as a result of the coronavirus crisis. Also on rendement.nl/engels/coronavirus, you can find information on management during the coronavirus crisis, working from home, conference software and the short-time working regulation.
When an organization wants to contribute to the TNO’s research, employees can be asked to sign up on the ‘How am I’-app. They will then complete a list of general questions and subsequently receive a few short questions about their workday every day. These questions will be about the working conditions, the experience and how the employee feels about all this. The answers to the questions will not be linked to the employee’s email address.
The coronavirus crisis can possibly lead to an adjustment in profit sharing or the reward system used by an organization. For such adjustments, the works council has the right to vote. The council must keep a close eye on whether or not the system and the sharing are fair for all employees.
Because of the current coronavirus crisis, many organizations are facing difficult economic times. For this reason, the management may want to withdraw profit sharing. The latter arranges for employees to be paid an extra sum of money which is linked to the accrued profit of an organization. Although the Works Council Act (WOR in Dutch) mentions the right to vote on decisions pertaining to profit sharing separately in article 27, clause 1b, profit sharing is part of the reward system used by an organization. The reward systems aims to e.g. give employees a direct reward for achieved results, but it can also make rewards more flexible. According to article 27, clause 1c of the Works Council Act, the works council has the right to vote on decisions pertaining to the reward system. These decisions do not include the amount of reward, but the way the reward is calculated.
When the management wants to withdraw profit sharing, it is important the works council knows the underlying motives. Perhaps a less rigorous alternative can be thought of instead. In addition, the works council must check if profit sharing is also withdrawn for the management ‒ or at least economized. When the management continues to reward itself with extra money in these difficult times, the works council must address this.
In addition, it is important that the works council and the employees are clear on what is regarded ‘profit’ in profit sharing, how the extra sum of money is linked to it (e.g. a percentage of the gross monthly salary) and which criteria are used to determine qualification. The works council must be wary of arbitrariness and favoritism. Individual determination is permitted, however. For example, profit sharing based on the evaluation of an employee. Only for an exceptional performance an employee qualifies for profit sharing, but this quickly leads to an unfair situation. After all, it may be the case that not every role in an organization offers the same possibilities for an exceptional performance. The works council must therefore check if the assessment system is clear and fair to all.
Payroll and deployment agencies – just like other businesses – can now appeal to the regulation Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW). This was mentioned by minister Koolmees of the ministry of Social Affairs and Employment in an reply to the Dutch lower house.
In a question about the NOW regulation asked by the Dutch lower house, minister Koolmees of the ministry of Social Affairs and Employment replied that the regulation is also available to payroll and deployment agencies. Of course, these organizations must, just like all other businesses, meet the conditions of the NOW regulation. The NOW regulation arranges for employees to receive a compensation of max. 90% of wage costs. To be eligible, a business must face an acute loss in revenue of at least 20% over three consecutive months in the period between March 1 and July 31.
Employers will not include payroll and deployment workers in the wage bill of their organization. After all, these workers are under contract with the payroll or deployment agency. The latter are in charge of the workers’ salary administration, payment of social premiums and e.g. pensions. When payroll agencies continue to invoice businesses using their services, these businesses can get into trouble because they may no longer be able to pay the invoices. Therefore, payroll and deployment agencies can make agreements with businesses using their services, for example on payments or the suspension of contracts.
Some deployment workers, as well as some people with on-call or zero-hour contracts and some flextime workers will still miss out, though. These are people who, despite the NOW regulation, lost their job and are unemployed since March 1. Some of them do not meet the conditions for an unemployment benefit or are not eligible for a welfare benefit because of the income or capital of their partner. Minister Koolmees is looking into ways to still support this group of people.
Businesses struggling financially because of the coronavirus crisis can appeal to the Belastingdienst for an exceptional deferral of payment. This will allow them to set aside their tax debts for three months. The tax authority has now given more information on the deferral. Amongst others, the day the deferral was requested determines the day the deferral expires.
The exceptional deferral of payment (bijzonder uitstel van betaling in Dutch) applies to various taxes, such as income tax, corporate tax, VAT and payroll tax. Businesses can request a deferral via a letter to the Belastingdienst or by completing an online form. The latter must be signed through DigiD. When the Belastingdienst grants the deferral, tax payments are suspended for 3 months.
Requesting a deferral of payment can only happen after a business has received a financial assessment. It is however possible to request a deferral for e.g. corporate tax, VAT and payroll tax at the same time without having to wait for an separate assessment for each tax. A business can request a suspension of tax for three months or more than three months. The latter can only be requested via letter; and additional evidence is required.
As mentioned in a post from the Belastingdienst on the forum Fiscaal Dienstverleners, the date on the request for deferral determines the date the deferral expires. The expiration date is three months after the date on the request. The expiration date will not shift when a business requests another deferral of three months for a later assessment. When three months does not suffice, the Belastingdienst stated that the business must file another request after those three months.
When a business requests a longer period of deferral, the tax payments are first also suspended for only three months. After this period, the inspector will check if (s)he needs more information, such as a statement by an accountant. Furthermore, the Belastingdienst will also notify a business whether or not the deferral also applies to tax debts from before the coronavirus crisis.
The more lenient application of exceptional deferral of payment will last until June 19, 2020 at minimum. The question is what happens after this date and whether or not businesses can actually catch up on their tax debts when the deferral expires. In a letter to the Dutch cabinet, the Nederlandse Orde van Belastingadviseurs (NOB) – the Dutch professional association for tax advisers – has elaborated on this problem of ‘double tax payments’ (i.e. both the payment of the old tax debt for which a deferral was requested as well as the new tax debt accrued during the period of deferral). The professional association has asked the cabinet to think about a solution for this problem, in order to avoid a scenario in which viable businesses will still collapse under their financial debts.
Occupational doctors receive many complaints about office landscapes. A lot of employees point to the office landscape as one of the causes for their absenteeism or even burn-out. State Secretary Van Ark has therefore decide to conduct research on the effects of office landscapes.
Working in an office landscape has negative effects on many employees. A whopping 90% of those calling in sick have told the doctor that the office landscape is one of the causes for their absenteeism. The most common problems are noise disturbance and loss of concentration, but lack of privacy and too many stimuli are also often mentioned. This will show in e.g. fatigue and headaches.
For State Secretary Van Ark, this was enough cause to have the office landscape researched. Office landscapes have never been part of any research, but that is about to change. The first step Van Ark has taken is to include the subject ‘working in an office landscape’ in the Nationale Enquête Arbeidsomstandigheden, the national survey on working conditions. Further steps include the likely adjustment of the national norm on ‘workplace surfaces’.
If this does indeed happen, the new norm will dictate more square meters per workplace. Because of the coronavirus crisis, this is very likely to happen anyway. Since employers are responsible for proper working conditions, they are the ones charged with thinking about a better set-up for office landscapes. Advice from the works council can play a crucial role here.
Through the NOW regulation, organizations can receive compensation in wage costs from the UWV. Because the coronavirus crisis means that organizations need the money quickly, the UWV will pay and advance of the subsidy as soon as possible.
The regulation Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW) arranges for employers to receive a compensation for the wage costs of three calendar months. The intention is that employers are paid an advance of 80% of the subsidy soon after application. Officially, the UWV must decide on the subsidy and proceed to payment within 13 weeks after receiving a completed application. However, plans are to do this more quickly: within 2 to 4 weeks. So far, this has seemed manageable for the institute: only a few days after the starting date of the NOW regulation, thousands of employers already received the first part of the advance.
The UWV will pay the advance in three terms, with about a month in between each. For the part of the compensation that remains to be paid thereafter, the employer has to wait a bit longer. Within 24 weeks after the end of the three indicated months for which a loss in revenue is expected, the employer must inform the UWV on the actual loss in revenue. The NOW regulation states that the UWV must then determine the definitive amount of subsidy within 52 weeks. Most businesses will be informed on the definitive amount within 22 weeks, but for doubtful cases the UWV may need more time to conduct checks.
In theory, it is therefore possible that an employer applying for subsidy for the months May, June and July is only informed on the definitive amount of compensation in August 2021. And when the employer him-/herself is too late to inform the UWV on the actual loss in revenue, then in the worst case scenario it can take until the beginning of 2022 for the final payment to be made.
By the way, it is not at all certain the employer will actually receive the remaining 20% of the originally determined amount of subsidy. When e.g. the loss in revenue is less than expected or the wage bill after January 2020 is lower, the definitive amount of subsidy is adjusted.
Previously, businesses could use the regulation Groeifaciliteit until July 1, 2020. In time, a few of the financing elements from the regulation can also be arranged via Invest-NL, which started this year. Regulation Groeifaciliteit was therefore planned to be ended. However, because of the coronavirus crisis, the planned end date has been postponed by a year. Therefore, Groeifaciliteit will now end on July 1, 2021.
Groeifaciliteit is a regulation in which the financer of risk-bearing capital to a business receives a state guarantee of 50%. This means government will reimburse 50% of losses when the financing unexpectedly causes a loss for the financer.
The regulation Groeifaciliteit should ensure that financial institutions more quickly provide venture capital to businesses. Venture capital consists of equity plus the subordinated part of debt capital of the business. This type of capital plays a pivotal role in the financing of a quick growth, a takeover, a buy-out and internationalization, but also of less favorable situations like a reorganization.
In January of this year, the investment fund Invest-NL was launched. With the arrival of Invest-NL, the regulation Groeifaciliteit was planned to be phased out quickly and end on July 1, 2020. The ambition of Invest-NL is to make the Netherlands more sustainable and innovative. Currently, Invest-NL is still focused on fast-growing, innovative businesses and is extremely popular: within the first week already 120 applications had been received. Because Invest-NL is not yet focused on goals which are facilitated by Groeifaciliteit, such as financing for a stronger balance or for reorganizations which, especially during the current coronavirus crisis, will be necessary, the regulation Groeifaciliteit will remain until July 1, 2021, as written in a letter to government. When you want your business to profit from the regulation, you must ask your financer to apply to the Rijksdienst voor Ondernemend Nederland (RVO) – Netherlands Enterprise Agency – via the website rvo.nl. A direct application to the RVO is not possible.
An employer cannot compel employees to take vacation days off because of the coronavirus measures. Yet, neither does an employer have to grant a request by an employee to cancel already taken vacation days.
Because there is less work at the moment, employers sometimes compel their employees to take annual leave so that they use up their vacation days. Legally speaking, this is not permitted for statutory vacation days. The employer can ask his/her employees to take vacation days off, but employees are free to decline such a request. For extra-statutory vacation days, other arrangements may apply.
The employer must, however, stimulate employees to use their remaining vacation days of 2019. The statutory vacation days of 2019 will expire on July 1, 2020. But then again, the employer cannot compel the employee to take vacation. When an employee does not use his/her vacation days of 2019 in time and the employer has informed the employee clearly and in time about the expiration date, the vacation days will expire on July 1.
Perhaps an employee wants to cancel already taken vacation days, for example because a planned trip is cancelled due to the coronavirus. An employer does not have to grant this request, however. This means that the already approved annual leave must be taken, yet employees and employers can discuss whether there are any alternative possibilities. This is recommended to the employer to maintain the employee-employer relationship. Still, taking some time off at the moment may not be a bad idea, because even when working from home an employee needs enough rest and relaxation.
It is possible to make agreements on mandatory days off, for example the day after Ascension Day. These agreements must be recorded in the CLA, the employee handbook or the contract. When an employer wants to change the collective days off, the works council must agree with this decision. An employer may sometimes compel employees to take days off granted by working overtime (adv-dagen in Dutch); but again, this must also by recorded in the CLA, handbook or contract.
The coronavirus crisis has a great impact on business. Employees are working under exceptional circumstances and many are left with all sorts of questions. It is important that the works council keeps a close eye on what is going on. Especially now, the works council must maintain frequent contact with employees.
Now that many employees are working from home because of the coronavirus, colleagues are no longer chatting with each other around the coffee dispenser. This means members of the works council pick up fewer signals from what is happening on the work floor. However, chances are that many employees are facing challenges right now. Have the work processes changed and are they workable in the current situation? What about workload? Do employees succeed in combining work and home schooling for their children? Do they know the possibilities to request a leave? Do they need support? The coronavirus crisis brings along new challenges, questions and worries for everyone.
For the works council it is also a challenge to keep social contact with employees at distance. It is advised that the works council arranges video calls with key members of the various departments at set times, e.g. once a week, to draw up an inventory of issues within the organization. All sorts of conference software is available which the works council can use to maintain contact with employees, with other members of the council and with management. When it turns out multiple employees are running into the same issues, it is important to discuss this with management as soon as possible; preferably with concrete points of improvement.
When there are signals which demand immediate action, the works council can invoke the right of initiative (article 23, clause 3 of the Works Council Act) to come up with concrete proposals. When e.g. workload is too high, the works council can propose to temporarily decrease the personal targets of employees, to cancel several tasks or to postpone projects for now or move them to the autumn. Or perhaps something can be improved in the work processes? During the coronavirus crisis, the works council is an important ally for both employees as well as employers.
With everyone working from home because of the COVID-19 (coronavirus) measures, conference software like Zoom or Skype has never been as popular. But there are quite a lot of options to have online meetings for free: which option suits your organization the best?
The most popular free software packages to organize an online meeting are Zoom, Google Meet, Skype and GoToMeeting (Jabber and Slack are popular paid options). With these programs, employees keep in touch with each other easily when working from home. This is done by chatting, calling or video meetings.
Zoom’s basic package is free and accepts max. 100 participants, of which 49 are visible at the same time. In the free version, meetings with three or more participants can last max. 40 minutes. Employees need a MeetingID to attend a meeting, but they do not need to create an account. Recently, there were a few security and safety issues. Zoom has announced it will focus on a solution in the coming period, but until then it is risky to use Zoom for business: your organization does not want a data breach. GoToMeeting also offers a free basic package (and a trial period of 14 days for the paid version). Here, meetings of max. 40 minutes are possible with a maximum of three participants. Employees need a meeting link, a MeetingID and the name of the meeting room.
Via Skype, a maximum of 50 employees can participate in one video meeting. To invite employees to a meeting, everyone has to be added individually. At the moment, it is no longer necessary to have a Skype account to participate in a meeting; only the organizer must have an account. The organizer can then generate a link which offers other employees access to the online meeting.
Google Hangouts Meets has room for max. 30 employees in one video meeting. It uses a invitation link to join a meeting, after which a ‘meeting code’ must be inserted. It is possible to participate in a meeting for free, but in order to start a meeting yourself you must pay for G Suite. Until June 1, 2020, extra options in the more expensive subscriptions are free for all G Suite users to help organizations work from home because of the coronavirus. Amongst others, this means that 250 participants can be invited to one video meeting.
Companies that have requested an exceptional deferral of payment for VAT and payroll tax because of the coronavirus crisis do not have to also file a notification of insolvency. This was announced by the Dutch Ministry of Finance.
When it turns out a company cannot pay its tax debts, normally the management must file a notification of insolvency to the Belastingdienst to prevent liability to the management. Management is faced with this liability when it does not act as good management due to unseemly managing. This happens for instance when a company is insolvent and the management does not make a notification of this in time.
The Dutch Ministry of Finance has now decided that a separate notification of insolvency is not necessary during the coronavirus crisis when a deferral of payment for VAT and payroll tax has already been requested. Therefore, the management of a legal entity eligible for corporate tax no longer has to file a notification when the company has already filed a request for deferral of payment. This decision applies to already expired tax periods as well as future tax periods. So, when payroll tax for February cannot be paid, a financial assessment has been sent in April and for this assessment a deferral of payment has successfully been requested, the management no longer has to file a notification of insolvency.
The Belastingsdienst has also confirmed that a request for deferral of payment is regarded as a notification of insolvency.
Employers are advised to provide guidance especially for younger employees during the mandatory working from home because of the coronavirus crisis. Especially to the group up to the age of 34, working from home is quite a challenge and many are showing signs of burn-out-like complaints more often than other age groups.
Now that employees are working from home en masse because of the coronavirus, employers should do their best to keep everyone motivated. Especially the group up to the age of 34 deserves extra attention here. In this situation, they are most likely to develop stress and burn-out symptoms such as concentration problems. This was mentioned in the newspaper Financieel Dagblad. Younger employees up to 34 years old are more vulnerable due to several reason. They are more likely to live alone and therefore become more isolated than people with families. The possibility to relax outside of their homes has now disappeared. They miss the structure of a family. Work also often forms an important part of their identity. Moreover, for many this is the first real threatening crisis they experience in their lives, which may also have major consequences financially.
According to Financieel Dagblad, almost 70% of employees in the age group of 18 to 34 years old says to experience stress. In comparison: in the group of 55+ of age, the rate is a lot lower, at 60%. Employers should therefore keep engaged with the youngest employees, for example by video calling or regular phone calls. The employer can introduce structure by e.g. arranging a daily online fitness class for everyone. Moreover, (s)he can actively point out the possibility to contact the prevention officer or the occupational doctor when some has to let it all out.
During the period an employer receives subsidy through the Tijdelijke Noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW), the employer is not permitted to dismiss employees because of business economic reasons. When such dismissals do happen, the subsidy will decrease.
Through the NOW regulation, an employer can apply to the UWV – the Dutch Institute for Employee Insurance – for a financial compensation of max. 90% of wage costs for a period of three months. Thereby the employer promises (s)he will not dismiss any employees for business economic reasons. When this does happen, the employer must withhold the decision within five workdays or face a penalty in the form of a lowered subsidy. The UWV will increase the wages of dismissed employees by 50%. The wages (including the 50% raise) are subsequently subtracted from the subsidy. Furthermore, employers dismissing staff for business economic reasons must make it plausible that even with the NOW regulation the dismissal(s) cannot be avoided. The UWV will thus consider the NOW regulation when assessing dismissals.
During the period of subsidization, e.g. a dismissal during probation or a termination of the employment contract because of mutual agreement is not prohibited. Moreover, an employer can appeal to the UWV for a ‘dismissal permit’ (ontslagvergunnning in Dutch) for an employee because of a long-term disability to work or (s)he can request the kantonrechter (type of judge) to dissolve the contract for reasons other than business economic reasons. The employer is obliged, however, to keep the wage bill as similar as possible. Not extending temporary contracts and dismissing staff may result in a lower wage bill and therefore a partial reclamation of the financial compensation received.
Initially, the UWV will pay the employer 80% of the financial compensation as a an advance. The compensation is based on the wage bill of January 2020. When the term of subsidization ends, the UWV will calculate the definitive compensation. Here, the UWV will consider the actual loss in revenue and the average wage bill of the months of March, April and May 2020. When the employer dismisses staff or does not extend temporary contracts during this period, (s)he will pay less wages and hence the wage bill will possibly turn out lower. This will also lower the definitive amount of subsidy. Chances are the employer must then pay back a sum of money to the UWV. This may also be the case when the loss in revenue turns out less than expected.
When an employee is working abroad more often than expected, for example because of the coronavirus crisis, this can have consequences as to which country may levy tax on his/her wages. This could mean that Dutch employers may no longer withhold part of the wages for tax. However, when an employee works in his homeland more often, this means that the employer must now withhold part of the wages for tax.
Most tax treaties state that the country in which an employer works has the right to levy tax on wages. This means that when an employee works for a Dutch organization in e.g. Belgium, the Dutch employer may not withhold part of an employee’s wages for tax and premiums for the Dutch tax authority, the Belastingdienst. Instead, the employee must file his income tax return him-/herself with the Belgian tax authority.
There is one exception to this main rule: the employee’s country of residence may levy taxes when the following conditions are met:
All together, these three conditions are known as the ‘183 days regulation’ (183-dagenregeling in Dutch).
Because of the coronavirus crisis, it could be the case that an employee living in the Netherlands and working for a Dutch organization in Belgium no longer meets the ‘183 days regulation’. He or she is operative for example in the nursing industry and therefore resides for more than 183 days within the period in Belgium. Or (s)he does not return back home every night, but instead stays in Belgium to avoid unnecessary travel time. In that case, the country of residence – i.e. the Netherlands – and the Dutch employer may no longer withhold part of the wages for tax, but the employee must instead notify the Belgian tax authority of his/her income.
The reverse may also happen. When an employee normally files his own taxes with the Belgian tax authority because (s)he stays in Belgium for too many days to meet the ‘183 days regulation’, then the coronavirus crisis could change this. Maybe (s)he no longer works or works from home and therefore does meet the criteria now. Your organization may now withhold part of the wages to pay wage tax and social insurance premiums or the employee can decide to not file taxes with the Belgian tax authority but instead with the Dutch tax authority. Mind you: when you invoke the ‘183 days regulation’, you must be able to prove that the conditions are met!
Once again, the cabinet reaches deep in its pockets to lessen the financial trouble of businesses. The budgets for state guarantees and business loans will increase substantially. Also, more employers affected by the coronavirus crisis can apply for a gift of €4000. And finally, the cabinet is working on a solution for insurances and supplier credits.
In the middle of March, the Dutch cabinet announced a set of emergency measures to drag businesses through the coronavirus crisis. This set of measure is constantly adjusted when necessary. Therefore, it has now been decided to make more money available for state guarantees and business loans. With the state standing surety, it is just a little bit easier to ask a bank for financing.
The state guarantee can be obtained through one of two regulations: the Garantie Ondernemersfinanciering (GO) or the Borgstelling MKB-kredieten (BMKB). The budget of the GO regulation was already increased to €1.5 billion in March, but now it has been even further increased to €10 billion. Also, the percentage of state guarantee on loans in increased. Normally, this is 50%, but for SMEs affected by the coronacrisis, the state now stands surety for 90%. For large businesses, this is 80%. For this regulation, the boundary between SMEs and large business is a annual revenue of €50 million. The BMKB regulation has also been extended:
Businesses without a banking relationship, such as start-ups or businesses financing everything with their own capital, are not forgotten. They can turn to the Regionale Ontwikkelingsmaatschappijen (ROM’s). For the moment, the cabinet makes €100 million available. The regulation should be ready by the end of the month.
In addition, the cabinet is searching for a solution to insurances on so-called supplier credits. These are often found in the hospitality industry, such as in shops or restaurants. Here, the supplier will deliver e.g. the coffee or clothes, but the buyer still has 30 to 60 days to pay the delivery. The supplier will insure him-/herself for the risk of not getting paid. Now that the risk of not getting paid has increased, it has become much more difficult for businesses to take out such a credit insurance. The government has decided to step in by standing surety for the insurance themselves. The regulation must still be worked out, but it is expected that €12 billion is necessary.
A new extension of the emergency aid consisting of a one-off gift of €4000 for businesses affected by the coronavirus crisis has been announced. In the meantime, over €58 million has been paid so far to businesses, as mentioned in a letter to the Dutch lower house. The gift is already available to the hospitality industry as well as barbers and shop owners. As of April 15, more branches are added. These include amongst others tattoo parlors, physiotherapists, taxi companies and zoos. Whether or not a business is eligible for the gift depends on the so-called SBI code the business is registered under in the Business Register. The list of SBI codes of branches already eligible and the list of the new branches to be added can be found on the website of the RVO, the Netherlands Enterprise Agency.
Over ten thousand employers have already applied to the UWV for a financial compensation for wage costs because of the coronavirus crisis. The temporary NOW regulation isn’t always the solution, however.
The NOW regulation has been kept as simple as possible, so that employers can receive money for their wage costs quickly and jobs can be kept. Because the regulation does not tailor to individual cases, a part of organizations will be left out. In order to be eligible for an advance (of 80%) of the compensation, the expected net revenue in three consecutive months must drop by at least 20% compared to a quarter of the annual revenue of 2019. An organization which has grown substantially the last year may therefore miss out on the compensation, even though it is in grave financial trouble because of the loss in revenue and increased costs. Also start-ups, businesses part of a concern or businesses making money mostly during springtime may not be eligible for the NOW regulation.
On the other hand, an organization eligible for the NOW regulation must keep in mind that the regulation may not turn out as was hoped. For example, it could be the case that the (advance of the) subsidy is too low to postpone financial problems. The subsidy does not cover all wage costs, nor all employee charges. Moreover, the advance is based on the wage bill of January 2020. This could result to a lower definitive calculation of the subsidy when the wage bill for the months March, April and May turns out lower than in January. However, when the wage bill increases, the UWV will not compensate the increase! When an employer appeals for dismissals (either successfully or not) during the period of subsidy, the UWV will increase the wages of the respective employee(s) with 50% during the calculation of the subsidy. This amount is subtracted from the subsidy. In other words, dismissals are financially penalized. Any other violations of the conditions can also lead to a decrease in subsidy.
Even before the NOW regulation was put into effect on April 6, minister Koolmees of the Ministry of Social Affairs and Employment announced several technical changes were included in the regulation. It is possible more changes will follow, although it is factored in that not all organizations will be eligible for the regulation and that the regulation may turn out as a disadvantage to businesses. Because of the uncertainties and specific rules applying to the NOW regulation, it is recommended that an employer planning on applying for the regulation first immerses him-/herself in the rules and even asks for legal and financial advice from a specialist. On uwv.nl you can find information on the NOW regulation (in Dutch) and file an application.
Businesses looking for more financial breathing room during the coronavirus crisis could consider forming a fiscal unit (fiscale eenheid in Dutch). When one business is doing well, its profit can be offset against the loss in another business within the unit. This could lead to a fiscal advantage, but the construction isn’t advantageous in all situations.
Businesses can form a fiscal unit for the purpose of corporate tax and/or VAT. There are of course several conditions; for example, the parent company must own at least 95% of shares with the right to vote (aandelen met stemrecht in Dutch) of the subsidiary.
The advantage of a fiscal unit is that the Belastingdienst regards the businesses involved as a single taxpaying entity. This means only one tax return must be filed. Moreover, for the purpose of VAT, the unit doesn’t have to pay any VAT for services and supplies provided between the members of the fiscal unit.
A fiscal unit can offset the profits and losses of the businesses involved for the purpose of corporate tax. During these hard times, it could be the case that one business is suffering severely because of the coronavirus crisis, whereas another is doing well. In this case, forming a fiscal unit for corporate tax instead of filing tax returns separately can turn out to be advantageous to both businesses.
However, there are also disadvantages. For example, all businesses within the fiscal unit are liable for the tax debt of the unit (during the period they are member of that unit). So, if one business suddenly goes bankrupt, this has a fiscal impact on the other businesses. To form a fiscal unit for corporate tax, businesses must make a request through a form on the website of the Belastingdienst. In order to break up the unit, they must also contact the tax authority. It is important, however, to take care when breaking up a fiscal unit for corporate tax, because the Belastingdienst will oversee the entire process to make sure no tax advantages remain.
To form a fiscal unit for VAT, no request must be made with the Belastingdienst. When businesses meet the conditions, the fiscal unit can be formed ‘by operation of the law’ (i.e. automatically).
The coronavirus clearly shows in the rate of absenteeism in March. During the week of March 16 to March 22, number of people reported as absent due to sickness increased by 80%. This has never been seen before. However, it appeared there had been a slight misunderstanding.
ArboNed/HumanCapitalCare published an analysis of the recorded absenteeism of last month. During this period, the rate of absenteeism due to the coronavirus increased by 30%. When focusing on SMEs, the rate even increased by 60%, with a massive peak in the week of March 16-22. And short-term leave wasn’t even included in the figures. The arbodienstverlener was able to collect data on absenteeism because coronavirus-related questions were added to the list of questions for employees who were reported as having recovered.
Part of the reported absenteeism turned out to be unjustified. Because employees were given the advice to stay home for minor complaints such as a cold, employees who had these complaints were also reported as absent due to sickness. This turned out to be unjustified according to ArboNed. Employees who do not have any complaints which disable them from working should not be reported as absent due to sickness. This rule also applies to those who must remain at home and can therefore not do their job, such as builders.
Informing organizations about the rules concerning when or not to report someone ‘absent due to sickness’ already caused a substantial drop in the rate of reported absenteeism. However, there is an increased danger of psychological complaints now that everyone is working from home. For example, the distinction between work and private life is gone, which hampers people’s ability to switch mindsets when they have had a bad day at work. This way, they recover less quickly. In addition, working from home can cause people to spent more hours working, resulting in longer workdays than in the office.
In order to back businesses during the coronavirus crisis, the government gives state guarantee to loans taken by businesses. For this, the so-called GO-regulation has been extended.
Through the GO-regulation, which stands for Garantie Ondernemingsfinanciering (Guarantee business financing), the government stands surety for 50% of a loan. This way, it should be easier for businesses to take a loan with a bank. After all, the financers can count on a wealthy party (i.e. the state) as an extra guarantee they will see their money back.
Such an extra guarantee is welcome businesses longing for a loan during the current crisis. For this reason, the amounts to which the GO-regulation applies have been extended. Now, amounts up to €150 million fall under the regulation (this used to be €50 million). Because the government stands surety for half of the amount, the maximal guaranteed amount is €75 million. The application for a GO-regulation guarantee comes about via the bank. The budget for the GO-regulation has also been increased. This used to be €200 million, now it is €1.5 billion.
The extension of the GO-regulation is part of a large set of emergency measures implemented by the government. Before, the so-called BMKB regulation was extended. With this regulation, the government also stands extra surety for loans. The BMKB is meant for businesses with a maximum of 250 employees, a annual revenue of max. €50 million or a balance sheet total up to €43 million. In addition, the government has reserved extra money for credit provider Qredits.
Businesses deploying temporary workers or staff on secondment which use a so-called g-rekening (g-account) can appeal to the Belastingdienst to unblock the account. This will disclose charged (additional) assessments for VAT and payroll tax. However, for these assessments, exceptional deferral of payment (bijzonder uitstel van betaling in Dutch) must have been granted because of the coronavirus crisis.
Organizations employing temporary workers or staff on secondment can request the deployment agency to open a so-called g-rekening (g-account) with the Belastingdienst. A g-rekening is a blocked account which allows the deployment agency to only pay VAT or payroll tax to the Belastingdienst. The amounts of VAT and payroll tax are deposited to this account by the deployment agency. When the latter does not pay VAT or payroll tax, the Belastingdienst can hold the organization employing staff responsible. The risk of liability is thus limited for the organization employing staff when they have already deposited payments to the g-rekening.
In order to be able to treat deployment agencies the same way as ‘normal’ businesses during the coronavirus crisis, the Belastingdienst has decided to permit businesses with a g-rekening to unblock the account on request to give these businesses more financial possibilities. The unblocking will disclose the amounts charged in the assessments for VAT and payroll tax. However, a business must first file a request for a deferral of payment for these assessments.
The temporary regulation to preserve employment, the Tijdelijke noodmaatregel overbrugging voor behoud werkgelegenheid (NOW), also partly compensates for pensions and possibly the accruement of vacation allowance. Employers can request the compensation as of Monday, April 6.
The NOW regulation – which replaces the previous short-time working regulation (WTV) – offers a financial compensation of max. 90% of wage costs to organizations facing a reduction in revenue due to the coronavirus measurements. To be eligible, an organization must have an acute drop in revenue of at least 20%. The compensation can be applied for at the UWV, the Institute for Employee Insurance. The reduction in revenue should take place during three successive months in the period of March 1 through July 31, 2020.
Amongst the wage costs for which employers can receive a compensation are premiums paid by employers and pension contributions. To quickly calculate the amount, the UWV assumes a fictional raise of 30% for employer’s charges. When the employer charges are higher, no customized calculation is possible.
The employer will also receive a compensation for the accruement of vacation allowance for the months of March, April and May (the months over which the compensation for wage costs is granted). In the advance payment, employers who reserve vacation allowance and employers who do not are treated the same way. In the definitive determination of the financial compensation, a correction for paid or reserved vacation allowance will be implemented. This is because the payment of vacation allowance is not regarded part of the wage bill.
For the calculations of the compensation, the UWV make use of the so-called socialeverzekeringsloon; these are the gross wages over which an employer pays employee premiums. The UWV will use the wage bill as filed by the employers in the payroll tax return in January 2020. At a later stage when the definitive determination of the compensation is made, the UWV will check the wage bills of March, April and May 2020.
The UWV will correct the subsidy when the wage bill has reduced compared to three times the wage bill in January 2020. Moreover, a compensation is given for wages up to €9,538. The UWV plans to pay 80% of the amount an employer is entitled to as a advance within 2 to 4 weeks. The employer him-/herself must continue to pay full wages to employees.
The works council of the Dutch National Opera, the Nationale Opera en Ballet (NO&B), is committed to an equal treatment of employees with a permanent contract and freelancers during the coronavirus crisis. The works council has requested the management to not only provide income security to employees with a permanent contract, but also to the many freelancers employed with the National Opera.
The works council has asked the management of the Dutch National Opera to take a principle decision on how to deal with the employees who do not fall under the NOW regulation. The works council demands a clear signal of confidence and solidarity, also to the large group of flextime workers employed with the National Opera.
The works council refers to minister Van Engelshoven (Ministry of Education, Culture and Science), who appealed to institutions to also observe contracts with freelancers during the coronavirus crisis. According to the works council, the NOW regulation offers the possibility to fund this. The works council has used its right to initiative (article 23, clause 3 of the Works Council Act (WOR)) to give unsolicited advice to the management. The council wants its management to insist the minister to also make it possible for the NOW regulation to be applicable to hired freelancers in the cultural industry. Preservation of employment is after all one of the most important goals of the NOW regulation, as emphasized by the works council, even if there is no work at the moment for them. At the Dutch National Opera, around 600 employees have a permanent contract. For its production, the National Opera hires a large number of freelancers in addition.
One of the tasks of the works council is to improve the equal treatment of all employees within an organizations (article 28, clause 1 of the Works Council Act (WOR)). According to this Act, the works council represents only employees with a permanent contract, but agreements can be made between the council and management to deviate from this rule. The National Opera already planned on strengthening the position of hired freelancers. The works council had agreed with the management to also give flextime workers active and passive right to vote during the next works council elections. This election has been postponed to September 2020, however, due to the coronavirus crisis.
The Belastingdienst has increased the number of taxes for which an exceptional deferral of payment can be requested. In addition, the conditions on sending along evidence and including a statement of a third-party expert have been adjusted.
When entrepreneurs face liquidity problems because of the coronavirus, they can appeal to the Belastingdienst for an exceptional deferral of payment (bijzonder uitstel van betaling in Dutch) for their taxes due. This deferral no longer applies only to (additional) financial statements for income tax, corporate tax, VAT and payroll tax, but also to income tax on gambling, insurer tax, lending tax, ecological taxes (EB/ODE, coal tax, waste tax, tap water tax), excise taxes (mineral oil, alcohol and tobacco) and the consumption tax paid over alcohol-free beverages.
When an entrepreneur wants a deferral of three months, (s)he should send a letter with a request to the Belastingdienst or fill out the form ‘Verzoek bijzonder uitstel van betaling voor 3 maanden’ on the website of the Belastingdienst. Access is secured by DigiD. If the deferral of three months isn’t enough, a request can be send for more than three months. This request can only be send by postal letter. When the tax due is less than €20,000, the entrepreneur must send along evidence demonstrating that the revenue has dropped dramatically in comparison to previous months. A statement by a so-called third-party expert is not required. When the tax due is more than €20,000, then a statement by a third-party expert must indeed be included.
What the evidence must include must still be announced by the Belastingdienst. When entrepreneurs request a deferral of more than three months, the Belastingdienst will contact them on what additional evidence they must send. The details must be sent within the period of three months.
Employers unable to meet reintegration requirement because of the coronavirus can expect leniency from the UWV, the Dutch Institute for Employee Insurance. This was mentioned by the UWV in an appendix in the work guide Poortwachter.
Because of all the steps taken to combat the coronavirus, the reintegration process of sick employees can either be delayed or even come to a complete halt. Employers are eager to know how the UWV will handle this. The UWV has therefore published an appendix to the work guide Poortwachter, the guide on rules and regulations concerning reintegration. In this appendix, the institute states that it will take the virus and its effects into consideration when examining reintegration requirements. An employer shall indicate what the consequences of COVID-19 are for the organization and the reintegration process of the sick employee. Subsequently, the UWV will assess if the reasons indicated are plausible enough for the stagnation of the reintegration process. Also after the coronavirus crisis, the UWV will allow for situations in which the coronavirus may have affected the reintegration activities.
After having been sick for 2 years, an employee can apply to the UWV for a benefit based on the Act Wet werk en inkomen naar arbeidsvermogen (WIA). For the application, the UWV will examine whether the employer and employee have exerted enough effort for reintegration of the employee. The UWV could decide the employers hasn’t put in enough to re-integrate the employee. In such case, the institute can impose a wage penalty (loonsanctie in Dutch) on the employers. This involves the employer having to continue paying wages to the sick employee for max. one year. However, the coronavirus can hinder reintegration efforts, for example through a forced closure of the business. The UWV will assess if this is a ‘reasonable basis’ not to impose a wage penalty. Of course, the employer must provide enough motivation as to why certain reintegration activities have not been executed. The exact conditions for this can be read in the appendix to the work guide Poortwachter on the website of the UWV (in Dutch only).
Under normal circumstances, employers must inform the Rijksdienst voor Ondernemend Nederlands (RVO) – the Netherlands Enterprise Agency – before April 1 of how many hours they have spent in 2019 on research and development (R&D). A new application for WBSO, a tax regulation promoting research and development, must always be filed before April 1. However, because of the coronacrisis the RVO is more lenient and the deadlines have been extended.
The Act Wet bevordering speur- en ontwikkelingswerk (WBSO) is a tax regulation giving organizations a subsidy in the form of a reduction on payroll tax. In order to be eligible, an employer must have received a research & development (R&D) statement (S&O verklaring in Dutch) and meet the administrative requirements. The latter involves the employer informing the RVO via its website rvo.nl of the total amount of hours worked, the costs and expenses on R&D within three months after the end of the calendar year. This would be April 1 and is normally a tight deadline. However, because organizations may not be able to meet the requirements before April 1 as a result of the coronavirus crisis, the deadline has been extended to June 15, 2020. This means employers have until that date to inform the RVO without risking a penalty. This will give more time to inform the RVO of the hours spent on R&D and possible costs and expenses over 2019. Passing this information on to the RVO is mandatory for organization which have received a R&D statement.
When an organization wanted to file a WBSO application with April 2020 as the starting month, they normally had the time to do so until March 31. However, because of the large number of applications, this deadline was extended until Sunday April 5, 2020. The WBSO is by far the most important subsidy regulation in the Netherlands. Especially Dutch SMEs are thankful of its existence.
Just as in 2019, the tax reduction in 2020 is 32% of wage costs and other costs and expenses in research and development up to an amount of €350,000. For start-ups, a reduction of 40% is applicable here. Above €350,000, the reduction is 16%. More information can be found on mijn.rvo.nl (in Dutch), under the heading ‘Realisatie melden’ and ‘Aanvragen’.
The works council of KLM is pleased with the Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW), the temporary regulation for the preservation of employment, announced at the end of March by minister Koolmees of the Ministry of Social Affairs and Employment. But the works council claims this regulation is not enough. KLM needs more support and guarantees from the government.
Last Monday, minister Koolmees of the Ministry of Social Affairs and Employment announced the NOW regulation was going to replace the short-time working regulation (WTV). According to the works council, this is not enough for the airline. The works council has based this statement on the financial information provider earlier that week by financial director Erik Swelheim. According to the works council, KLM needs more support and guarantees from the government.
Because of the coronavirus outbreak, KLM has shut down almost its entire fleet of 200 aircraft. The severely affected airline, with over 30,000 employees, expects that around 1,500 to 2,000 employees will lose their jobs because of the coronavirus crisis. KLM wants to keep as many of their employees with a permanent contract as possible. The airline plans on not extending temporary contracts. If KLM must keep flextime and temporary workers employed, as demanded by the government, the airline cannot exclude forced dismissals.
The works council is therefore pleased with the new measures announced by minister Koolmees, although the works council does count on more government support. According to secretary of the works council, Dario Fucci, the Dutch and French governments have been discussing government support to KLM and Air France for some time now. He expects they will expand their interest in Air France-KLM. It is still unclear when the support plan will come.
Just two months ago, the KLM works council demanded clarity from the government about the future of their employees because of the airport in Lelystad. The works council then blamed the government of indecision and argued for a growth of Schiphol and the opening of the airport at Lelystad as an ‘auxiliary airport’ for Schiphol. Because of the coronavirus crisis, the opening of the airport in Lelystad has been postponed to November 2021.
During this coronavirus crisis, many employees are uncertain about their annual leave. Because why would you take vacation days now? Perhaps you’re even thinking of cancelling vacation days you have already requested. Yet, from the point of view of working conditions, this may not be such a good idea.
We are once again approaching that time each year when, with a little bit of creativity in terms of when you plan your vacation days, you can have a lot of free time around the upcoming holidays. However, many employees are in doubt. Because why would you use your annual leave now? After all, you can’t go anywhere and your are already at home. Yet, from the point of view of working conditions, it is a good idea to advice your employees to take a few vacation days. Working from home might seem relaxing, but it is actually very strenuous; especially now that many extra activities have to be done, such as video meetings.
Another problem is that people get annoyed more quickly when they can’t make deadlines due to their family situation. This does not improve the overall atmosphere. Especially then, it is nice to be able to relax for a few days and take care of private matters in peace. Therefore, even for employees who plan on cancelling some of the vacation days already requested, it may be worth it to have a few days off around the upcoming holidays.
In addition, there is uncertainty about the expiry of vacation days accrued in 2019. They will expire on July 1. However, many employees are asking their employers if the deadline can be extended because they can do less with their free days at the moment. Of course, employers aren’t eager to do so, because there is the fear that everyone wants to take annual leave once businesses start running again. Therefore, employers must quickly provide clarity on their standpoint. Moreover, employers could temporarily reduce the workload per employee, so that the latter can catch their breath once the coronavirus crisis is behind us.
Working from home every day because of the coronavirus requires a comfortable workplace at home. Unfortunately, the laptop provided to you by your employer has quite a small display. Luckily there are ways to avoid you having to squint your eyes to read the text on the screen: simply connect a second, larger monitor! So how is that done?
When you have a spare large monitor laying around, it may be a good idea to connect it to your laptop. Then you will have at least one larger display to work on, but of course you are free to use both displays for more workspace.
To connect an extra monitor, you should follow these steps:
Usually the laptop will recognize the external display when it is connected. To change the screen settings in Windows 10, you must click on ‘desktop’ and select ‘display settings’. Under ‘multiple displays’ you can select what your display should look like. You can also press the Windows-button + P. There are four options:
Director/major shareholders (dga’s in Dutch) may temporarily receive a lower customary salary when their company has been affected by the coronavirus crisis. However, this only applies to the upcoming months and may not be applied retroactively.
In the payroll tax return of the company, a director/major shareholder must include a salary which is ‘customary’ for his/her work. According to the rules, this salary is the same as that of an employee in the ‘most comparable employment’, without there being a substantial interest. The standard amount for the customary salary in 2020 is €46,000.
Now that many businesses are affected by the coronavirus crisis, a high customary salary can be a heavy burden on the financials. When the crisis has ‘great consequences for the revenue and liquidity of the company’, the director/major shareholder and the company may agree to a lower monthly salary, as stated by the Belastingdienst. This lower salary is then included monthly in the payroll tax return.
At the end of the year, the company will determine the customary salary for the entire year. It will then become apparent how much the company has been affected by the crisis. The customary salary may thus be determined afterwards, as stated by the Belastingdienst. When at the end of the year it turns out the company has paid too little, the company must file the remainder with the Belastingdienst as salary and pay tax over it.
By that time it will become clear how the Belastingdienst is going to deal these exceptional circumstances. According to the rules, the burden of proof that the customary salary must be lower than the standard amount lies with the director/major shareholder. Of course, the main rule says that the height of the customary salary should be based on the salary in a ‘comparable employment’, not on the amount of revenue. However, the tax authorities will be more lenient when the survival of the company is at stake.
The salary already received in the past months of 2020 may not be lowered. The company and director/major shareholder can only make new agreements for the upcoming months. By the way, they are allowed to come to an agreement together; they do not have to discuss matters with the Belastingdienst.
Now that employees work from home to limit the spread of the coronavirus, having a weekly team meeting has become a lot more difficult. Still, in this digital world there are good alternatives to the classic face-to-face meetings.
The first step to online meetings is knowing which software is best to use. Two well-known providers of business communication software are Cisco Jabber and Slack. Both platforms offer employees the possibility to send each other direct messages, call each other and have video meetings. Messages can be sent to a group, but also to individuals. It is possible to share screens, making it easy to show information or to demonstrate how software works. Employees can also share files with their colleagues. Both Slack and Jabber can be used on PCs and laptops, but also on Android and iOS devices.
Jabber is actually a replacement of your office telephone. The platform allows both internal and external phone calls. Moreover, incoming calls can be forwarded to a mobile phone number. Jabber also has the option to integrate planners, allowing you to start a meeting based on the integrated planners of the participants. In addition, Jabber gives a notification when a colleague is giving a presentation; his/her colleagues then know they shouldn’t interrupt. Employees can access Cisco Jabber when the organization already has a license.
With Slack, employees can log on using their email address. Slack uses channels to order communication. You must therefore create different channels for different subjects and groups. It is possible to integrate a lot of apps with Slack, such as Google Drive, OneDrive and Outlook. Moreover, Slack is fun to use, especially now that colleagues have no lunch breaks together. This is because the program gives access to lots of emojis and GIFs (using the Giphy-app); an approachable and collegial means of communication to keep the cohesion in the team. Slack offers a free entry version; however, in this version only one-on-one video calls are possible. For versions with more possibilities, a monthly charge must be paid.
The Dutch cabinet is doing everything in it power to help entrepreneurs affected by the coronavirus crisis. Many director/major shareholders have also been affected, but it is not always transparent whether or not they fall under the emergency regulations. In the meantime, there are votes to temporarily revoke the gebruikelijkloonregeling (customary salary regulation) for director/major shareholders.
Director/major shareholders (dga’s in Dutch) have always had a special position in Dutch law and regulation. They are shareholder, director and employee of their own company. This means it is not always transparent whether or not they fall under the emergency regulations the cabinet has implemented for ‘employers’ and ‘self-employed individuals’. What is the state of affairs?
The newest emergency regulation is the NOW regulation. Simply put, with this regulation the government assumes the wage costs of businesses and organizations which experience an acute decrease in revenue. The compensation depends on the loss in revenue. Corresponding documentation shows that, in principle, director/major shareholders are not eligible for this regulation. They do not fall under the definition of ‘employee’ used by this regulation. Only director/major shareholders who are obligatorily insured for employee insurances can apply for NOW regulation. Most of the time, director/major shareholders are not insured for this, because they are legally excluded from such insurance.
In addition, there is the TOZO regulation, which provides income support and business capital for self-employed individuals. The Ministry of Social Affairs and Employment has stated that director/major shareholders are eligible for this regulation. The only conditions are that they meet a minimum of hours devoted to their business (1,225 hour per year), the so-called urencriterium in Dutch, that the director/major shareholder has full control (i.e. more than 50% of shares) and bears the financial risks. Furthermore, the director/major shareholder must make it plausible that the company cannot pay salary at the moment. The director/major shareholder also appears to be eligible for the emergency aid consisting of a one-off gift of €4,000, provided that the company meets the general terms and conditions. And finally, director/major shareholders can also apply for an exceptional deferral of tax payments.
To lower the wage costs for director/major shareholders, the Nederlandse Orde van Belastingadviseurs (NOB) – Dutch Association of Tax Advisers – has appealed to the government to temporarily revoke the customary salary regulation. This regulation specifies the ‘customary’ salary a director/major shareholder should include in the payroll tax return for his work. For 2020, this salary is €46,000. The NOB has appealed to the government for a temporary revocation of the regulation; or at least, for a limited application of it.
When an employer applies for a subsidy based on the implementation of the Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW), then (s)he is obliged to inform the works council. This obligation is included in the implementation of the NOW regulation, which was published on March 31.
On March 31, 2020, the Dutch cabinet implemented the Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW), a temporary regulation to preserve employment during the coronavirus crisis. This regulation – which replaces the short-time working regulation WTV – offers a compensation for wage costs to organizations which expect a loss in revenue of at least 20%. The subsidy is max. 90% of wage costs. In this regulation by the Ministry of Social Affairs and Employment, the role of the works council is mentioned explicitly.
Article 13 of the NOW regulation mentions the obligations an employer has when (s)he wants to use the subsidy. Clause d obliges the employer to inform the works council or the employee representatives; and when an organization has no works council or employee representatives, the employees must be informed directly. Although the works council’s right to give advice does not apply to application of the NOW regulation, the works council is not sidelined. Besides the right to information, the works council has the possibility to give unsolicited advice to the employer based on the right of initiative (article 23, clause 3 of the Works Council Act).
When the works council receives information from the employer about the application for the NOW regulation, they must check whether the provided information is clear. Can the employer fulfill the obligations? For example, the obligation to continue the full payment of wages for employees during the term of the subsidy and not to dismiss any employees for financial or business-related reasons. Not fulfilling the obligations can result in a partial or full reclamation of the provided subsidy.
The works council can assist the employer in communication to employees about the NOW regulation. In this communication, the most important thing is clarity to employees about what the direct consequences are for them. Therefore, emphasize the fact that they will continue to receive their full wages because of the subsidy provided by the government. This way, the employer can take away any uncertainty with employees about their own income and whether the organization can continue to pay wages.
For many charities the coronavirus crisis has major consequences. Events and actions have come to a halt and many organizations have had to close their doors. How can your organization continue to use volunteers in these difficult times?
Good communication is essential during this troubled period. Your organization must provide clear information about the coronavirus and its impact on your charities. Which activities can be continued and which actions have been cancelled? What can volunteers do? What will your organization take up during this period? Clear communication will prevent annoyance with volunteers, members and others involved.
This period is the perfect moment for your organization to take up certain activities and volunteers can definitely be of a helping hand. Overdue chores for example, such as ordering the administration or cleaning the premises (of course while adhering to the rules, so do not involve too many people). In addition, there may be activities which can be done from one’s home, such as calling or chatting with people and computer work.
It is of course of added value when your organization can contribute to society and use the help of volunteers where necessary. Start local initiatives to make things easier for vulnerable groups. Or contact other organizations to see if you can be of use together. See it as a good excuse to improve relations and to come up with ideas together.
Your organization can also use this period to look ahead. Which activities would you like your organization to take up in the future? What has to happen for this? There are plenty of possibilities to brainstorm about new ideas for your charity. Perhaps your volunteers need extra (online) training? Of course, this is only possible when the financial impact is not too great. And how about discussing what your organization needs to put your charity in the spotlights? It may very well be possible your organization can already arrange the materials needed for this.
In addition to café owners, cinema owners and barbers, shopkeepers can now also appeal to the government for emergency aid. A one-off compensation of €4,000 can be obtained for those who see their income disappear.
All sorts of businesses, from bowling alleys and swimming pools to restaurants and fitness centers, have had to close their doors because of the measures implemented by the government. However, part of their expenses continue in the meantime, such as rent for the premises.
To somewhat cover the costs, these businesses can appeal for a compensation of €4,000. This is a one-off gift. Moreover, the compensation can only be obtained per business, not per establishment. The compensation is part of the set of supporting measures implemented by the government.
In addition to businesses forced to close by order of the government, there are more businesses feeling the consequences of the measures implemented. Shopkeepers are allowed to keep their shops open, but the order to stay home as much as possible and to keep a distance of 1.5 meters has led to a sharp drop in customers. For this reason, the government has decided to also allow shopkeepers to apply for the compensation, which can be done on the website of the Rijksdienst voor Ondernemend Nederland (RVO), the Netherlands Enterprise Agency. The agency needed some time to add the new industries to the online application form, but according to the website this has now been done.
The compensation is only available to specific industries, which is regulated by use of the so-called SBI-code of that industry in the Business Register. The SBI-codes of the new industries have now been added to the application form.
Businesses eligible for the compensation but which are registered under an incorrect SBI-code in the Business Register can report this to the RVO. The latter will look per case if anything can be done. The RVO asks people to be patient, as it is not always possible to log on due to the large number of people who try to apply for the compensation.
Entrepreneurs who see their profit decline due to the corona crisis should have their provisional assessment of corporate tax revised. Because this assessment is based on data from earlier years, the tax due can turn out to be too high. However, requests to lower the provisional assessment should not be sent by email, as the tax authority will decline the request.
Businesses eligible for corporate tax often receive a provisional assessment of that year at the beginning of the year. Based on data of earlier years, the Belastingdienst calculates how much tax the business will likely have to pay. The respective business will often pay the corporate tax monthly throughout the year. The next year, a definitive calculation is made and the tax authority will determine whether too much or too little tax has been paid.
Because of the corona crisis, it could be the case that the provisional assessment can now already turn out to be too high. After all, the profit of the previous years will probably not be obtained in 2020. However, businesses are already paying corporate tax for 2020 on the basis of those previous years. It can very well be the case they are giving the tax authority more money than they should. Money which is better spent in keeping the business alive. Therefore, businesses can file a request to receive a revised (i.e. lower) provisional assessment. The Belastingdienst has stated it receives many of these request via email at the moment. However, the tax authority tells us that this is difficult to process administratively and sensitive to mistakes. For that reason, requests via email are not accepted. The sender will receive a letter of rejection.
So what are the correct ways to file a request for the revision of the provisional assessment of corporate tax? There are three ways:
Has the office been closed completely for several weeks due to the coronavirus outbreak? Then beware of legionella bacterium and take action in time. These bacterium multiplies quickly in stagnant, lukewarm water, such as found in unused water pipes.
The corona epidemic has forced people to work from home en masse. Some offices are only staffed minimally, others are used or cleaned only once or twice a week. However, when your office has been closed completely for several weeks on end, then the legionella bacterium can strike. This bacterium prefers stagnant, lukewarm water between 20 and 50 degrees Celsius. These are conditions found in unused warm water pipes. The growth of the bacterium can be prevented by flushing the pipes well before use.
According to the Netherlands National Institute for Public Health and the Environment (RIVM in Dutch), keeping the taps running for a full minute every week is enough. The cleaners can be asked to do this. In offices closed and unused for a longer time, the taps must also run for a longer time. Do not forget other places with stagnant water, such as humidifiers, showers and plant sprayers. Water in reservoirs which is heated to temperatures above 60 degrees Celsius poses no danger.
The legionella bacteria spread through water droplets. These originate mostly from spraying water and the vaporization of water. When someone has contracted an infection by inhaling the bacterium, the symptoms can range from flu-like complaints to pneumonia – symptoms also found with coronavirus patients. An infection by the legionella bacterium is called legionellosis, also known as Legionnaires’ disease.
The temporary regulation for the preservation of employment, the Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid (NOW), has been published. This regulation, which replaces short-time working, offers organizations in trouble because of the coronavirus a compensation for wage costs in the form of a subsidy.
Minister Koolmees of the Ministry of Social Affairs and Employment has published the details of the NOW regulation. From April 6, employers with an acute loss in revenue of at least 20% (for three consecutive months within the period of March 1 through July 31) can apply to the UWV – the Dutch Employee Insurance Agency – for a financial compensation. The agency is getting prepared for ten thousand applications. The UWV strives to pay out advance payments as compensation for wage costs within four weeks after opening of the regulation. Until that time, organizations in need will have to put up with the situation. Applications can be filed until May 31, 2020.
The main themes of the regulation, announced by the minister two weeks ago, have not changed. The amount of subsidy depends on the loss in revenue. Two examples: with a 100% loss in revenue the compensation is 90% of wage costs; with a 50% loss in revenue the compensation is 45% of wage costs. For the application, the loss in revenue does not have to be proven to be related to the consequences of the coronavirus. Also, it is not important whether or not employees are working at the moment. However, there are of course several conditions. The employer should keep the wage bill as equal as possible, is not allowed to dismiss employees for financial or business-related reasons during the term of the subsidy, must keep a controllable administration for five years of relevant data from before the subsidy and inform the works council, employee representatives and employees on the subsidization.
The advance payment (80% of the total amount of subsidy) is based on the expected loss in revenue. For this, the employer compares the revenue in the 3 months of subsidization with 1/4 of the annual revenue in 2019. Within 24 weeks after the end of the 3 months, the employer will appeal to the UWV. (S)he will then present an audit’s report stating the actual loss in revenue. When this turns out to be lower, the employer must refund the excess amount (s)he has received. And when it turns out to be higher, the UWV will pay extra money. In principle, the compensation is based on the wage bill of January 2020 and includes the wages over which tax and social premiums are paid plus 30% of premiums paid by the employee, such as vacation, pension and employee premiums. Per employee, the maximal amount of subsidy is €9,538 per month.
It is possible that the period over which employers can receive a compensation will be extended for another 3 months. The minister will return to this possible extension of the NOW regulation later. Additional conditions can then be included, for example in the field of training.
A recession is inevitable, according to the Dutch Bureau for Economic Policy Analysis (Centraal Planbureau in Dutch). The Bureau worked out four scenarios which sketched the economic consequences of the coronavirus for 2020 and 2021. All scenarios ended in a recession.
The four scenarios all had different starting points for the duration of contact limitations and the depth of the economic impact: 3 months, 6 months, 6 months (plus a negative impact) and 12 months. In all four scenarios, the Gross Domestic Product (GDP) shrinks with 1.2% to 7.7% in 2020. In 2021, the GDP either rises with 3.5% or drops with 2.7% in the worst case.
In the best case scenario, the economy will recover in the third quarter of 2020. In the worst case scenario, problems will also occur in the financial sector and the situation will also deteriorate in other countries. This will eventually lead to a slower recovery for the Dutch economy.
Unemployment will increase only slightly in the best case scenario, but in the worst case scenario will rise by 9.4% in 2021.
Because of the emergency measures implemented by the government, state finances deteriorated severely in all four scenarios. This will therefore happen for sure. In the worst case scenario, the debt will reach 73.6% of the GDP at the end of 2021. This is substantial, but still far away from the danger zone.
The Dutch Bureau for Economic Policy Analysis has sketched the four scenarios for the following reasons: the measures to limit contact and uncertainty the crisis causes have a noticeable impact on economic activities. There is still a lot of uncertainty, and almost no macro-economic data is available. An estimate is not very useful in such a situation. Therefore the scenarios have been used to provide insight into the size of the impact and to make apparent where most uncertainty is.
The conditions a self-employed entrepreneur has to meet to be eligible for the temporary regulation Tijdelijke overbruggingsregeling zelfstandig ondernemers (TOZO) in connection with the coronavirus have been announced. Through this regulation, self-employed individuals can make an appeal for income support and a loan for business capital.
A self-employed entrepreneur who is expecting a sharp decline in income because of the corona crisis can appeal to the municipality office for the temporary regulation TOZO. This regulation is only meant for self-employed entrepreneurs who:
To be eligible for the temporary regulation TOZO, a self-employed entrepreneur has to declare that because of the corona crisis (s)he expects the income for the next 3 months to be lower than the social minimum. The entrepreneur will then receive a supplement to his/her income for the duration of 3 months. Married individuals and individuals living together receive a net supplement up to €1,500; individuals living alone a net supplement up to €1,050. The supplement received is a gift, which means it does not have to be paid back. The supplement should be received within 4 weeks after the appeal has been filed.
Self-employed entrepreneurs facing liquidity problems can apply for a loan for business capital of max. €10,157 with a 2% interest. The maximal loan term is three years. Redemption of the loan will only start in January 2021; until then, the entrepreneur does not have to pay back anything.
The management of Tata Steel will continue in its plans for a large-scale reorganization for Tata Steel Europe. The steel giant does not comply with the appeal of the European Works Council to postpone the plans because of the corona crisis.
The European Works Council (EWC) had requested the management to postpone its plans for reorganization because of the corona crisis. After all, employees of the steel giant are already affected enough by the corona crisis. Last Thursday, the CEO of Tata Steel Europe, Henrik Adam, notified the EWC that the management will not comply with this appeal. Despite the corona crisis, Tata Steel Europe will not postpone its economizing measures. This will mean the loss of approximately 1,000 jobs in the Netherlands. The EWC is very disappointed the management continues in its plans and deems it unacceptable. The EWC has announced it will take action together with the trade unions against this decision.
The figures of Tata Steel Europe have been under pressure for some time now because of the declining steel market, resulting in the threat of a mass layoff of employees. The corona crisis has only further deteriorated the situation. Various car manufacturers – an important sales market for Tata Steel Europe – have suspended production because of the corona crisis. As a result, production has also been scaled down in IJmuiden, the location of Tata Steel Europe. The consequences of the corona crisis are also noticeable in the factory of Tata Steel. A skeleton crew is used on the work floor and many office employees are working from home. Moreover, absenteeism because of the coronavirus is very high at the moment. This adds to the pressure on employees.
For some time now, the EWC has been in discussion with the management of Tata Steel about the European plans for reorganization. Recently, it was announced that in Europe, not 3,000 but 1,250 jobs will disappear, of which approximately 975 in Ijmuiden. The EWC noted that good support for this plan is missing.
No less than 5 professional associations have sent a joint letter to the Ministry of Finance asking for 3 additional measures in response to the corona crisis. The measures pertain to the extension of tax terms, the position of the director & major shareholder, and self-employed entrepreneurs and the criterion of hours devoted to their business.
In their letter, the 5 professional associations – het Register Belastingadviseurs (RB), de Nederlandse Beroepsorganisatie van Accountants (NBA), de Samenwerkende Register Accountants en Accountants Administratieconsulenten (SRA), de Nederlandse Orde van Administratie- en Belastingdeskundige (NOAB) and de Nederlandse Orde van Belastingadvisuers (NOB) – argue amongst other things for an extension of certain tax terms. This will give taxpayers more breathing room to focus their attention for now on limiting the consequences of the current crisis and will allow intermediaries to provide better support in this.
For the position of director & major shareholder, it is desirable to have clarity on which regulations (s)he can apply for, for example the regulation in effect for freelancers or the regulation Tijdelijke Noodmaatregel Overbrugging voor Werkbehoud (NOW). Even when no special regulations for the director & major shareholder becomes available, clarity is still desirable according to the professional associations. In the meantime, it has become clear that the director & major shareholder can apply for the regulation Tijdelijke overbruggingsregeling voor zelfstandige ondernemers (TOZO). This regulation will support self-employed entrepreneurs, such as freelancers, by providing extra money for income and capital loans, giving them a better chance to keep their business running.
The last point of concern is the self-employed entrepreneur and the entrepreneurial advantages mentioned in the Income Tax Act (Wet Inkomstenbelasting). To be eligible to these advantages, the entrepreneur has to devote a certain number of hours to his/her business, call the urencriterium (criterion of hours) in Dutch. In some industries, such as hospitality and the event industry, there is real concern whether or not the criterion can be met. A decisive answer is of course desired; however, the statement that this topic is looked into will do for now. The associations have indicated in their letter that they are prepared to assist in thinking about possible solutions and to strengthen the policy surrounding the emergency measures implemented. The letter was send in response to signs from the workplace.
Because of the corona crisis and the emergency measures the Dutch cabinet has announced, there is a likely chance businesses have had to cancel events. What should these businesses do to the VAT when events had to be cancelled?
Because of the emergency measures by the cabinet many businesses will face cancellations. At the moment, this applies to many events (e.g. tickets). What should be done to the already paid VAT? There are three possibilities:
When in doubt whether or not VAT can be reclaimed, always contact the Belastingdienst or your advisor.
Cyber crime is a real hazard to the Dutch economy. In the year 2019, at least 188 organizations had to deal with ransomware. Also the coronavirus is used by cyber criminals to send phishing emails.
Last year, the Dutch police received 188 reports of ransomware. This type of blackmailing software involves an computer infection. Generally, this means the entire computer network of an organization is shut down: criminals will encrypt the files, hoping the organization will pay for the decryption. Especially organizations with no back-ups are often tempted to pay the ransom.
The Dutch Data Protection Authority (Autoriteit Persoonsgegevens (AP) in Dutch) warns against criminals who make use of the coronavirus to enrich themselves. They will send phishing emails with fake information about COVID-19. As soon as someone clicks to open the email, they can install malware or discover other information. The Data Protection Authority advises to delete unexpected emails or emails from an unknown sender immediately. Do not click on links in these emails, do not open any attachments, do not fill out any information and report to the ICT department in your organization immediately.
In addition, it is very important to have up-to-date back-ups, to install antimalware software which scans downloads and email attachments and to always install all recent updates. These measures will possibly reduce the number of 188 cases of ransom software in 2019, as mentioned in a letter to the Dutch lower house by minister Grapperhaus. Moreover, it may help to ask employees to only open their private email accounts on their own computer, phone, etc. This is especially important now that many people work from home because of the corona crisis. Moreover, according to the General Data Protection Regulation (GDPR), organizations processing personal details and information must report infections by ransomware or cryptoware.
Employees who are worried because they have several corona-like symptoms may contact the arboprofessional – a professional in charge of enforcing rules and regulations pertaining to working conditions. Although this person is no doctor, it won’t harm to him/her to be updated on the most common symptoms.
At the moment, people work from home en masse. Because it is the end of winter and most people’s natural defense against diseases isn’t optimal, many employees will experience minor health complaints. Right now, most people experiencing such complaints will immediately think about a coronavirus infection. GP centers have asked people not to call when experiencing minor complaints, yet people want certainty. An email to the arboprofessional may be an option for them: “do you know if my symptoms suggest a coronavirus infection?”
This is quite a challenging question, given that the arboprofessional is no doctor. Fortunately, based on the symptoms of Chinese patients the European Centre for Disease Prevention and Control (ECDC) has composed a list (Risk Assessment) of the most common symptoms:
Less common symptoms are nausea and diarrhea. It is advised to have employees suffering from severe cases of the symptoms in this list contact the occupational doctor or GP.
Taxpayers who have asked for help from the Belastingdienst for their 2019 income tax return are automatically given a deferral of income tax return until September 1, 2020. Because of the coronavirus, all agreements pertaining to filing tax returns have been revoked.
The Belastingdienst offers help to people unable to file their income tax return themselves. For this, the taxpayer has to make an appointment. However, due to the coronavirus, these appointments are canceled. Therefore, the Belastingdienst has given these people an automatic deferral of their income tax return. This deferral only applies to those who had an appointment with the Belastingdienst before, which has since been canceled. The automatic deferral does not apply to people receiving help with their taxes from others, like the trade union FNV or the elderly union ANBO. These organizations have to request a deferral for their client themselves.
Other taxpayers fearing they won’t make the deadline of May 1, 2020 to file their 2019 income tax return can request a deferral. This deferral has to be requested online before May 1, 2020 via Mijn Belastingdienst on the website of the Belastingdienst. When given, the taxpayer has until September 1, 2020 to file their 2019 income tax return. Taxpayers not able to request via Mijn Belastingdienst have to call the BelastingTelefoon at 0800-0543 to request a deferral – keep your BSN number at hand.
The Dutch government has announced a set of emergency measures, but also internationally there are financial initiatives to pull entrepreneurs through the corona crisis. Amongst others, the European Central Bank (ECB) has announced several measures.
The European Central Bank (ECB) and other financial authorities will be more lenient towards for example the financial buffer requirements a bank has to meet. Banks will be able to borrow money from the ECB more easily. The borrowed money can then be loaned to the bank’s clients at a lower cost, for example to entrepreneurs strapped for cash because of the corona crisis.
Another way for businesses to obtain financing is by having the ECB buy bonds. If a business needs money, they can issue bonds. This means the desired amount of financing is divided, into for example parts of €1,000, called a bond. Investors can then buy such a bond for €1,000 and receive an interest payment. During the term of the bond, the business doesn’t pay back any money. When the term of the bond is five years, then the business has to pay back the money at a pre-arranged date. In the meantime, the business does have to pay interest over the outstanding amount. This is called the coupon. The coupon is paid over a fixed term, for example every three months or per year. A bond therefore resembles an interest-only loan. This way, business can obtain loan capital and pay interest to the creditor as compensation.
The ECB has announced that, until the end of 2020, it will spent €120 billion on the purchase of extra bonds, predominantly corporate bonds. This way, it will also be less expensive for businesses to borrow money, meaning that they can continue to invest now that the coronavirus is lurking everywhere and causing businesses to lose money. Moreover, a special ‘program’ has been set up, the Pandemic Emergency Purchase Program. Here too, corporate and government bonds will be bought for an extra €750 billion.
Employers must file their payroll tax return in time in order to claim the Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW). With the most up-to-date figures, the UWV can quickly calculate what employers are entitled to. This was written by the Belastingdienst in a urgent appeal to employers.
The Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW), the temporary regulation for the preservation of employment, is intended to compensate employers for their loss in turnover, allowing them to continue the payment of wages to their employees. With the most up-to-date figures from the payroll tax return, the UWV (the Dutch Institute for Employee Insurance) can quickly calculate what employers and their employees who end up at home or get sick are entitled to. Therefore, it is important employers file their payroll tax return in time. If this is really not possible, they can request a deferral by means of a written request. This request should be sent to the Belastingdienst, Mailbox 8738, 4820 BA Breda.
In addition, the Belastingdienst has pointed out that employers who have payment problems because of the corona crisis can obtain an exceptional deferral of payment of payroll tax, VAT, income tax and corporate tax. To obtain this deferral, employers must file their payroll tax return before the deadline. Three weeks after the deadline, they will receive a final levy assessment. The penalty for not paying in time does not have to be paid. Next, employers can request a deferral. They have to mention that the payment problems are a result of the corona crisis. The request, with notification of the reference on the assessment, can be sent to the Belastingdienst, Mailbox 100, 6400 AC Heerlen.
When the tax authorities receive the request, they will suspend all tax collection actions and revoke the default penalty. The employers is then automatically granted a deferral of 3 months and has to take no further action.
The Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW) is one of the measures from the set of emergency measures implemented by the government. With the NOW, employers can claim a compensation of max. 90% of wage costs. In order to be eligible for the compensation, they have to expect a loss in turnover of at least 20%. This applies to a decrease in turnover from March 1 onwards. At this moment, the measure is not yet in effect. The measure replaces the old regulation for short-time working (WTV). That regulation was ended because it wasn’t appropriate for the drastic consequences of the coronavirus COVID-19 on organizations.
Working from home as much as possible is a must in order to curb the spread of the coronavirus as much as possible. This does lead to a few new challenges with respect to keeping contact with colleagues. Most likely, the first online meeting did not go smoothly: colleagues kept the others waiting, there were technical issues and everyone talked at the same time. How do you organize an efficient video meeting?
To have a successful video meeting, a clear invitation is the first step. In this invitation, the organizer mentions the date and time, but also which software is used for the video meeting. This way, everyone can install the correct software, test whether or not they can log on and make sure the audio and microphone work. Popular platforms for video meetings are: Microsoft Teams, Zoom, Skype and Google Hangouts.
Ask everyone if they can log on a few minutes before the meeting starts so that the meeting can start on time. After all, it can be quite annoying for other participants when they must wait for latecomers or if there are technical issues someone tries to solve during the meeting. By the way, address latecomers via the chat: it will make them join the meeting more quickly.
Concentration during a video meeting runs out quickly. Therefore, take a short break now and then and ensure the meeting is as short as possible: for larger groups max. half an hour. To achieve this, a clear planner is essential.
To direct video meetings well, there should be a chairman who leads the meeting. This chairman decides whose turn it is to talk so that people don’t talk at the same time. A headset also improves the discussion: the noise echoes less and the quality is much better. Professional headsets don’t have to be expensive, but the standard headphones that comes with your smart phone also work. Instruct everyone to turn off their microphone when they aren’t talking. This prevents colleagues talking at the same time and distracting noise from the surroundings (such as the crunchy noise of a bag of chips or children running around). When someone wants to talk, this is immediately evident because (s)he will turn on their microphone. Do let the one who is talking finish.
Pension providers will help out employers who at the moment have problems to pay their pension premiums as a result of the corona crisis. This was agreed on by Stichting van de Arbeid, de Pensioenfederatie and Verbond van Verzekeraars.
The corona crisis causes financial problems for many businesses. In short time, income has reduced drastically and some organizations have had to suspend operation completely. Many employers who offer their employees a pension plan are now faced with problems in paying the pension premiums. The Stichting van de Arbeid, the Pensioenfederatie and the Verbond van Verzekeraars want to help out entrepreneurs when they run into problems. Many pension providers have already started.
The problems are different per employer and per sector, which means customized solutions are necessary. These come in one of three forms:
The laws on the collection of premiums and on payment terms still limit the possibility for a customized solution. The Verbond van Verzekeraars and the Pensioenfederatie plan on discussing this with the Dutch central bank (DNB) and the Ministry of Social Affairs and Employment.
The measures taken by pension providers could go into effect soon. They thereby partly anticipate the Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW), the temporary emergency regulation implemented by the government. Amongst other things, this regulation allows employers to request a compensation for wage costs. The government is currently elaborating this regulation. But the Stichting van de Arbeid, the Pensioenfederatie and the Verbond van Verzekeraars insist the government include both the part of pension premiums paid by employees as well as the part paid by employers into the NOW regulation.
Employers who encounter problems with the payment of their pension premiums are best off consulting the website of their pension provider of contacting their pension fund, insurance company, premium pension institution (PPI) or financial advisor.
Due to the coronavirus outbreak, the government has had to implement various measures. Your organization will no doubt feel the consequences of this. Financially too, it will affect your non-profit organization. Fortunately, there are a few things your organization can do.
The measures implemented by the government to combat the coronavirus have far-reaching consequences for the non-profit sector. For example, volunteers are no longer permitted to go door-to-door for collections. Various (national) collections were scheduled, but these have all been suspended. Moreover, several organization have had to close their doors, such as museums, theatres, schools and sports clubs. And last Monday, the Dutch cabinet announced that events, gatherings and meetings are prohibited until June 1. No doubt, this measure will have consequences for the activities of your organization.
To mitigate the consequences, several regulations have been established which may be of help to your organization. However, you and your organization can also do something yourself: try to reduce current expenses, ensure payment to debtors is on time and ask creditors for a deferral of payment. Also, do not forget to request the Belastingdienst for a deferral of payment and, if necessary, have the provisional assessment for corporate tax adjusted.
Perhaps door-to-door collections or events are no longer possible, but your organization can still continue fundraising online or set up a crowd funding campaign. Moreover, it is important to keep in touch with volunteers right now. They may be able to assist in online activities in order to preserve contact with the targeted audience. And in case there really is nothing to do for your volunteer, it may be an option to have them work for other organizations that are in urgent need of some extra hands.
Besides all this, your organization must of course keep in touch with other stakeholders, such as tenants, funds, suppliers and the municipality office. Maybe they can do something for your organization. In the end, you have to get out of the corona crisis together. And finally, this is the perfect opportunity to take care of overdue maintenance by e.g. having a large-scale spring cleaning, to update your administration or to plan and set up new fundraising events. Those events can then be initiated once things have settled down.
Since the outbreak of the coronavirus, trade union FNV has received many complaints about mishaps at work. Employers show little regard for parents working from home, unjustly withhold wages or do not accept employees calling in sick. The works council must also be on the alert for any mishaps on the work floor.
The FNV currently sees complaints about employers pouring in. Employees with health issues are forced to come to work by their employer – which is against the regulations. Parents without a ‘vital’ profession who aren’t able to work from home are told by their employer to arrange daycare for their children or forced to take vacation days or overtime. Moreover, it turns out many employees are afraid of getting infected because their employer is not taking sufficient hygienic measures. The FNV also reports that – contrary to the Noodmaatregel overbrugging werkbehoud (NOW), the temporary emergency regulation to preserve employment – employers withhold 10% of wages. According to the regulation, employers should pay 100% of wages. For this, they receive a compensation of max. 90% via the NOW regulation. The NOW regulation is one of the emergency measures for employers, implemented to prevent bankruptcy and unemployment.
At this moment, the works council is the most important sparring partner of employers. Especially now, the works council can be of added value by assisting director and employees in thinking about (temporary) solutions to keep the situation workable. Employers and employees must take into consideration the difficult situation the other is in. They have to be flexible, for example with respect to work hours. In additions, one of the special tasks of the works council (article 28 of the Works Council Act) is to promote the regulations on working conditions and working/resting amongst employers and employees. This will prevent overload and loss of employees. The Works council is definitely not sidelined!
Do not expect a new collective labor agreement (CLA) for your organization when the current one is about to expire. As a result of the corona crisis, no CLA negotiations will take place in the upcoming period, as announced by the employer’s organization AWVN.
Normally, many CLAs are negotiated in springtime, but this year that won’t be the case. Negotiations on new CLAs is not very useful at the moment, because the financial consequences of the coronavirus for businesses is uncertain, meaning that the starting point for employers in the CLA negotiations is unclear. Various CLA negotiations have therefore been suspended. When the CLA of your organization has expired, the agreements on working conditions stated in the expired CLA can legally remain in effect until a new CLA is negotiated.
The employer’s organization AWVN likes to see employers continue to discuss measures to preserve employment and prevent bankruptcy with trade unions and other employee representatives . A temporary solution can be, for example, to postpone profit distributions and (possibly in time) the payments of vacation money.
Because of the corona crisis, it is expected that the average rise in wages in CLAs will decrease from now on. At the start of this year, the average rise in wages was approximately 3%.
The European Commission (EC) has adopted a temporary regulation in which five types of governmental support are included. This will allow EU member states to handle more flexibly any governmental support and other supporting measures that are offered to businesses because of the coronavirus.
The temporary regulation by the EC is meant to ensure that member states can implement the measures required to support the economy and keep businesses running. The regulation is therefore an addition to the many other possibilities EU member states have at their disposal, according to the EU state support rules, to mitigate the social and economic consequences of the coronavirus. The regulation is in effect until the end of December 2020.
In the temporary regulation, five types of support are included:
Because of the corona epidemic, many people are submitted to intensive care. Among these are people who are employed. However, reintegration after having been in intensive care is not always as easy. Many ex-patients suffer from the so-called Post Intensive Care Syndrome.
Employees who end up in intensive care – at the moment, among other things, because of the coronavirus – have to get back to work after their recovery. However, this is not always as easy. First of all, many ex intensive care patients deal with muscle weakness. The longer someone spent in intensive care, the worse this is. The lesser muscle capacity also manifests itself in e.g. respiratory complaints. Another frequent yet less often recognized phenomenon is the Post Intensive Care Syndrome (PICS). This happens to approximately 30% to 50% of people who have been submitted to intensive care and resembles Post Traumatic Stress Disorder.
The complaints often develop over time. When someone has returned to work, PICS is not always recognized. The symptoms noticeable at work are memory and concentration problems, trouble to execute tasks to satisfaction and a worsened ability to solve problems. It is therefore important to be wary when someone has been in intensive care. Good guidance is very important, because for some employees is will be difficult to get back to the old level.
Official figures show that a quarter to one third of those who have been in intensive care can develop problems. Age is not a determining factor here. Estimated half of all patients need a year to return to work. Possibly a third won’t even return. The family of an intensive care patient may suffer as well, and they can also develop psychological complaints.
Do you have an administration or accountant office? Make sure to contact your clients, especially when they are operational in those sectors most affected by the coronavirus, such as the hospitality industry or cultural sector. Look into the best way to support your clients.
Is your office specialized in e.g. the hospitality industry, then many of your clients will be restaurant and café owners. You can support these clients by alerting them to the Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW) – a temporary regulation to help affected businesses – and help them in the application procedure, so that they can expect a compensation for wage costs of max. 90%.
Another important tip: not only the information provided by the government is important; also news from organization within branches, such as the Koninklijke Horeca Nederland (KHN).
Are some of your clients freelancers (ZZP’ers in Dutch) and are they affected by the consequences of the coronavirus? Alert them to the possibility to request an additional benefit for livelihood and/or business capital. Here, you can also help with the application procedure.
Clients who find themselves in severe problems because of the corona outbreak can also be supported by helping them to request deferment in exceptional circumstances of income tax, corporate tax, VAT and payroll tax with the Belastingdienst.
Your clients will have less income and this will of course affect your own income as well. Keep in mind that invoices will be paid later. Because of the coronavirus, there is now an exceptional situation. It may pay off, both for your business as well as your client’s, to make new payment agreements.
Perhaps superfluous: use your financial, administrative and fiscal knowledge to give your clients tailor-made advice. As an advisor, you must be able to identify the greatest risks your clients face and propose, and perhaps take, appropriate measures.
When organizations are in trouble because of the corona crisis, there is the possibility to defer the payment of vacation money for their employees as a last resort. This was mentioned by the trade union FNV, which emphasized that at the moment deferral is not yet under discussion.
Many organizations severely affected by the outbreak of the coronavirus have trouble paying their standing charges, such as vacation money and the distribution of profit. The trade union FNV has therefore mentioned the possibility for these organizations to defer these payments as a last resort. According to the FNV, this measure can absolutely be discussed in order to prevent bankruptcy. However, a deferral is not yet under discussion at the moment as, according to the FNV, organizations are already “compensated generously” by the cabinet’s emergency measures.
The deferral of profit distribution and vacation money is therefore only a last resort. As for now, employers can use the Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW), request deferment of tax payments or resort to other measures announced by the cabinet. However, not for all organizations are these measures sufficient to obtain more liquid assets. In that case, deferral of profit distribution and payment of vacation money can be discussed.
Airline KLM has already discussed agreements with the trade union FNV on deferral of profit distribution: the payment has been deferred until October. With the hospitality and retail industries, there are discussion on deferral of vacation money. In the collective labor agreement (CLA) for retailers, it is included that the payment can happen one month later – in June. This gives many organizations a little room to breathe.
Amongst others, pension funds, banks, regional water authorities (waterschappen in Dutch) and municipalities grant deferral of payment to entrepreneurs incapable of paying the respective organization because of the coronavirus. But not only entrepreneurs can make an appeal for deferral. Some organizations also grant a deferral to private persons.
Entrepreneurs could already receive a deferral of payment for their tax debts. However, if they are no longer able to pay the pension premiums, their municipal tax and water authority tax (waterschapsheffing in Dutch) and can no longer pay off loans and interest to the bank because of the coronavirus, they can now request a deferral of payment with many of these organizations. Many (governmental) organization have announced they are willing to cooperate in this.
Small businesses, with financing up to €2.5 million, are now granted a deferral of half a year to pay off their loans. For businesses with higher loans, there may be extra measures in the future.
Banks also want to help private persons who cannot pay the mortgage because of the coronavirus. For them, no collective measure has been announced, but they can contact their bank for a ‘customized solution’.
Before the coronavirus reached the Netherlands, the Climate Agreement was a hot topic for the Dutch government. The agreement was going to ensure the Netherlands would sharply reduce its CO2 emissions in the upcoming years. In order to achieve this, all sorts of measures were devised which would, for example, tax gas higher and electricity lower. One of the options in the emergency measures to preserve jobs and economy is a deferment of energy tax.
On Prinsjesdag, the day the Dutch monarch addresses the government, it was announced that the cabinet had plans to change the tax on electricity and gas. The levy on gas was going to be higher and that on electricity lower. As of 2020, the levy on gas in the first tax bracket (an emission up to 5,000 m3 per year) has increased by €0.04 per cubic meter. For the next six years, €0.01 per cubic meter is added each year. Meanwhile, the levy on electricity will lower.
Because many businesses struggle with their liquidity at the moment, the cabinet plans to temporarily defer the imposition of the energy tax for businesses in the 2nd, 3rd and 4th tax bracket. The same applies to the levy on the storage of sustainable energy (ODE in Dutch). The yield of the levy on sustainable energy will partly fill the budget for the subsidy on sustainable energy SDE+. The ratio was always fifty-fifty between entrepreneurs and civilians, but has since been changed to two-thirds for entrepreneurs. Therefore, they contribute more to the budget. But because of the corona crisis, entrepreneurs need a financial buffer now more than ever. For that reason, the cabinet is looking into ways to defer the planned energy levies. Here, it is important that the deferment of payments for the taxpaying energy suppliers actually leads to more liquidity for the buyers of electricity and gas. The plan is included in the emergency measures to preserve jobs and economy and has to be further elaborated. The cabinet will talk to energy suppliers about the matter.
Works councils have to pay attention to the director to ensure (s)he takes enough measures on time to protect employees against the coronavirus. In these exceptional circumstances, an unlawful distinction can grow between e.g. office workers and production workers.
Numerous organizations are closing and employees able to work from home do so to combat the coronavirus. However, not all organizations decide to close immediately or suspend production. As a result, a situation can present itself in which all office worker already work from home, but the production workers are still exposed to infection risks.
The works council can insist that a director suspend production as soon as possible to also ensure the protection of production workers. They can often not follow the advice and guidelines by the government, such as keeping a distance of 1.5 meters, putting them at risk. For example, the works council of Volkswagen in Wolfsburg, the headquarters of the car manufacturer, made a case for the interests of the production workers. Volkswagen then decided to temporarily suspend work in most European factories because of the coronavirus. However, it took until Saturday for the factories to close: too late in the eyes of the works council.
The works council wrote a letter to the employees stating that a ‘two-class society’ was growing. The office workers worked from home while the production workers were exposed to infection risks for an unnecessary long time. The production workers work shoulder-to-shoulder at the assembly line. This way, they cannot follow the guideline of keeping a distance of 1.5 meters, which has also been implemented by the German government in the meantime. Globally, approximately 25 employees of Volkswagen have been infected with the coronavirus. This was made clear in an earlier presentation of definitive results of 2019. Globally, more than 670,000 employees work for Volkswagen.
Now that many employees suddenly work from home, a responsible workplace is not always easy to set up. Which possibilities exist to work from home healthy and avoid physical complaints?
The Dutch cabinet has asked employers and employees to work from home as much as possible to prevent the spread of the coronavirus COVID-19. When employers compel employees to work from home, they must ensure the workplace at home meets the Working Conditions Act (Arbowet in Dutch) and that it is included in the RI&E (a risk assessment and evaluation, as dictated by the Arbowet). When these criteria are met, the employer can reimburse, distribute or lend work-related provisions to his employees tax-free. This also applies to situations where an employee is compelled to work from home. But even if the employer doesn’t demand his employees to work from home, but only offers it as a possibility, then the employer must still ensure an appropriate workplace at home to combat physical complaints.
But what about the current corona crisis, in which employees who never (or perhaps hardly ever) before worked from home and are now suddenly expected to work from home without having an appropriate, well-fitted workplace at their disposal? Many employees currently work at the kitchen table, with their children who must stay home running around and a partner also working from home. Fitting a workplace according to the Arbowet is perhaps impossible short-term. To ensure healthy working conditions, the employee can follow a few tips, such as not working for too long on end, having regular breaks, alternating between standing and sitting en having enough exercise.
An employer can assist employees who cannot find an appropriate workplace at home by keeping the office open or by looking for an alternative workplace, though this is made more difficult due to the closure of public venues. The employer can also opt to reimburse various items and include them as tax-free expenses (vrije ruimte in Dutch). Moreover, an employer can allow the employee to collect items from the office, such as a computer screen or office chair. In a user-clause, employers and employees can register which items an employee borrows, when he will return them and who will compensate for any damage done. In a temporary work-from-home agreement (tool), employers and employees can register agreements on incidental working from home in exceptional situations.
Many employees are forced to take drastic decisions due to the corona crisis. The question is which role the works council plays in all this? Can its members vote on decisions, should managers ask the council for advice or is the works council completely sidelined?
The coronavirus has caused many businesses to be temporarily closed or to have less work. A lot of employers have therefore already requested short-time working or intend to use the temporary emergency regulation NOW. The latter is part of the emergency measures announced by the Dutch cabinet to reduce the impact of the coronavirus on organizations and employers.
Deciding to use short-time working or the temporary NOW regulation can be subject to the voting right of the works council (article 25, clause 1 c and d of the Works Council Act (WOR in Dutch)). After all, such a decision involves the suspension of business activities, or at least part of those activities, or an important reduction or alteration of activities. An important difference, however, is that the measures taken at the moment are only temporary. Moreover, employees remain employed.
The same applies to alterations in work hours or tasks by employees. Normally, such alterations are subject to the voting right (article 27 of the WOR) and advisory right (article 25, clause 1d of the WOR) of the works council. However, again these measures are only temporary.
It is better for managers and the works council to avoid discussing whether the voting or advisory right applies. After all, both managers and the works council face the challenge of limiting as much as possible the radical consequences of the coronavirus COVID-19 on the organization. There is probably already a loss in turnover and it is likely that absenteeism will also increase considerably. The works council can assist managers in devising ways to limit the damage and finding support for those ideas with others in the organization. Moreover, the works council can invoke the right of initiative (article 23, clause 3 of the WOR) to provide unsolicited advice. In other words, the works council is definitively not sidelined!
The Bankruptcy Act Wet Homologatie onderhands akkoord (WHOA), aimed at preventing bankruptcy, should be implemented faster by the government, especially at this time when the corona crisis makes bankruptcy more likely. The Act is ready, but still has to be approved by both the Dutch lower house and Senate. A planned debate has been postponed, leading to frustration amongst insolvency lawyers, who have written an open letter demanding quicker action.
The WHAO Act serves to help businesses in financial trouble making it easier to reorganize problematic debts and prevent bankruptcy by means of an agreement with their creditors. At the moment, all creditors must agree, so one naysayer can prevent the agreement. The WHAO makes it possible to also legally bind the naysayer to the agreement. Creditors and shareholder who act unreasonably towards a plan to rescue a business can be compelled by a judge to cooperate. At the moment, this is not possible. As a result, businesses are often forced to file bankruptcy when one creditor does not cooperate. Especially now, when the coronavirus causes many business to struggle, this is not desirable.
In their letter, insolvency lawyers point out that damage as a result of bankruptcy can be reduced considerably when a business can offer their creditors a compulsory agreement. The business can then continue to run, employees keep their jobs and obligations to clients and suppliers can at least partly be kept. There may be a cut on shareholders and creditors, but they are better off than during a bankruptcy. Because of the WHAO Act, smaller businesses hit hard by the corona crisis can reorganize by means of state support and financial creditors such as bondholders and banks. Even if this only partly prevents bankruptcy, it would still save billions in damage loss and leads to job retention and continuation of business, for example by smaller entrepreneurs and freelancers.
Members of parliament are currently still working on the fine-tuning and improvement of the Act. Because debates are postponed, the approval by the Dutch lower house and Senate will take longer, leading to frustration with those who signed the letter. The fine-tuning is mostly aimed at SMEs. Earlier, the Commissie MKB, a commission for SMEs of the Dutch Professional Organization of Accountants (Nederlandse Beroepsorganizatie van Accountants), pointed out that when a business opts to use the WHAO Act, the court can appoint an expert who is a specialist appropriate to (the size of) the business. An accountant specialized in SMEs can fulfill this role as expert, because (s)he has the necessary financial and economic knowledge of SMEs. Current parties who reorganize and restructure larger businesses are not always appropriate for the same activities in SMEs. By using an independent accountant who has had appropriate extra education, the demands of creditors can be met, while retaining the smaller business and employment.
As the coronavirus epidemic causes half of the Netherlands to work from home, supervision is given a new dimension. Are your employees really working and not on the couch watching Netflix? And what about communication and the ability to complete their tasks without effects on their well-being?
Simply walking into each other’s offices to ask how a project is coming along or how things are is no longer possible. You can literally no longer see how your employees are working now that most of office life happens in their own homes. This is called supervision at distance. For some managers this is difficult, as they like to see an update appearing in their email inbox every thirty minutes. For them, ‘letting loose’ their employees is much harder. Unless they want to use software which gives them a day’s worth of work monitoring whether employees are logged on or off (of course, employees must be notified in advance if this happens), it is better to manage using output. In other words: do not check presence, but instead results. A shared planner is a more friendly way to register what everyone is doing. This is also useful to plan meetings via Slack, Hangouts, Microsoft Teams or Skype. This contact will strengthen the mutual bond of your employees as well as their connection to the organization.
Whereas one employee is much more productive at home, without colleagues and their stories at the coffee dispenser or running around a ping-pong table together, another is not at all productive during this crisis. The latter are mostly those employees in need of some form of supervision, a routine or discipline in order to do their work properly or employees with small children. Now that schools, daycare and grandparents are no longer an option, they themselves have to take care of their little ones at home, teach them, all while doing their regular job. This means work pace is lower. When necessary, redistribute tasks over your team.
Another cause for a lower work pace at home are IT problems. When all office workers are working from home using the corporate network it can get congested, leaving employees unable to do anything. Scale up immediately when the corporate network isn’t able to handle all work-from-homers.
Allow your employees to be more flexible with their work hours at home. Some prefer to work in the evening, others early in the morning. Do make agreements on when someone must be available. And keep tabs on your employees now their working from home: for some employees will make the pitfall of continuing for too long in order to finish a particular task. Make sure there is regular contact to gauge progress, otherwise you will end up with employees without a corona infection, but with a burn-out and painful neck and shoulders.
For occupational doctors, the coronavirus is also a real problem. For this reason, they have decided to give advice at distance for the moment. They have to assess per case if this is responsible.
Occupational doctors normally see employees reported sick by appointment and have open office hours. They then make a diagnosis, discuss an ongoing treatment or advise on a specific situation. However, the coronavirus outbreak and reduced public life makes all this a lot more difficult. Moreover, occupational doctors may unintentionally contribute to the spread of the virus by inviting employees on appointment. For this reason, they have decided to only contact patients by telephone or some other form of ‘contact at distance’. The doctor still has to assess per case if this is responsible, but limiting contact in person is directive.
This approach means that given advice may only be temporary. Of course, the doctor will mention this in his/her report. In addition, (s)he can opt to suspend a treatment until after April 6. Around April 6 the situation is assessed again. If necessary, ‘diagnosis at distance’ is kept for a longer time. Occupational doctors are still available for employees with questions on the corona epidemic.
From time to time, many office employees opt to work a day from home. Relaxed, in your pajamas, laptop on the kitchen table. But doing so for several weeks – perhaps even longer – is a whole different story. How are we going to survive that? Here are several tips.
Of all European countries, working from home happens the most in the Netherlands. So the Dutch are quite used to it. However, this is usually just one day of working from home, not weeks on end. Now, there will be no contact in person with colleagues for a long time, no internet connection from time to time either and because daycare facilities are closed some colleagues now work outside office hours. This may lead to frustration, a poor balance between work and private life and to loneliness. Therefore, take note of the following tips.
Safety first! Nothing is more important than your health. Creating an ergonomic workplace, taking breaks on time, going out for a little walk and calling it a day on time all reduces the chances of a poor health. Working safely also means you are safe online. Make sure your (wifi) connection is secure. Pay attention to phishing emails about the coronavirus and report it whenever you receive one. Also, do not install any unreliable apps, such as ‘COVID10 Tracker’.
Plan your work hours together with your colleagues. Not everyone works nine-to-five now. Some start early in the morning because then the children are still asleep, while others work in the evening because they aren’t a morning person. Use a shared online planner to keep track of when someone is working and available. This makes planning, for example for a meeting, easier. By scheduling a team skype session at the beginning of the week everyone knows of the others what they are doing and how things are going. Calling, mailing or texting more often also ensure you stay in touch with your colleagues.
Are your housemates interrupting you? Use the ‘blur-option’ in Skype to blur out the background. Though, the actions of an attention seeking cat or a child walking in and out of view can also bring a relaxing smile on our faces.
Some office employees go for a game of table football or ping-pong during lunch. To make sure you get a bit of exercise and contact with your colleagues, there is the possibility to set up an online sports area where actual physical exercise must be done. Do as follows:
The government has composed a list of ‘crucial’ professions. Individuals employed in these professions cannot be missed in the workplace. They are needed to keep society running during the COVID-19 outbreak. Employees with professions that require continuous presence in the workplace can continue to use daycare facilities.
Schools, daycare and out-of-school care facilities are closed until April 6 at minimum. To ensure that employees in crucial professions can continue to do their work while not having daycare for their children, the government has decided to keep daycare facilities available to this group of employees. The list of crucial professions is not all-encompassing but does give an insight into the most vital professions. These include, amongst others, professions in the health care and nursing industry, in public transport, food suppliers, internet and data providers, drinking water providers and electricity distributors.
When only one parent or caregiver is employed in a crucial profession, daycare has to be arranged by the family itself. There is the option for the partner employed in a non-crucial profession to stay home can care for the children. When this is not possible, these families are still allowed to use daycare facilities (such as schools, out-of-school care or child minders). It is therefore not imperative for both parents or caregivers to have a crucial profession.
The list of crucial professions is kept as restricted as possible on purpose, in order to limit the daycare function of schools and daycare facilities as much as possible. After all, one of the measures taken to combat the coronavirus is to not let children go to school or daycare facilities. In order to support organizations, the Dutch cabinet already announced a set of emergency measures against the coronavirus.
On March 7, 2020, on the initiative of the Dutch central bank (De Nederlandsche Bank), the Ministry of Finance and the Netherlands Authority for the Financial Markets (AFM) had a consultation together with the financial industry. Amongst others, it was discussed how the coronavirus affects the industry and what the latest development are. This is included in the ‘emergency measures for jobs and economy’.
During the consultation, amongst the topics discussed was the financing of businesses, the consequences of the coronavirus and the possible role the financial industry can play in all this. The banks indicated they are aware of their crucial role in the Dutch economy. They plan to discuss with their clients how they can be of assistance in these times.
After the financial crisis a few years ago, banks have had the opportunity to increase capital and liquidity. At the moment, the Dutch banks are doing well and can cope with temporary losses, for example through loans for SMEs. And although there are no signs of imminent problems with financial institutions, this could change in the near future. The Ministry of Finance, the Dutch central bank and the financial industry have therefore agreed to monitor the risks together.
To support the banks, the Dutch central bank announced that they would temporarily lower the (macro prudential) systemic risk buffer and postpone the introduction of a minimum for the risk weight of mortgage loans. This will temporarily give banks more leniency to meet losses and keep up credit issue. This measure will be in effect for as long as needed. Eventually, capital requirement will be reset to the current standards, as this is appropriate for the long term, according to the Dutch central bank.
More and more organizations are closing in order to combat the coronavirus. In the meantime, the Ministry of Justice and Security has also announced follow-up measures for the justice department. These measures are drastic for both employees as well as others involved.
As a supplement to the emergency measures against the corona crisis, the Ministry of Justice and Security has also announced follow-up measures for the justice department. For example, in consultation with the Openbaar Ministerie (Dutch public prosecution service), lawyers and the Ministry of Justice and Security, the judiciary has decided to close all courthouses. This means no trials will take place as of March 17 (0:00 o’clock) until April 6, 2020. Exceptions are urgent trials, such as constitutional reviews on detention of suspects, protective custody of children, supervision or immigration detention pending removal. For the highest department of administrative law (afdeling bestuursrechtspraak van de Raad van State in Dutch), the same measures apply. The Juridisch Loket, an judicial body of advice, has also closed all of its establishments, service points and remaining external locations for walk-in service or consultation. As of March 16, the Juridisch Loket is still available via telephone, email and internet.
The implementation of community service penalties by the Child Protection Council and penalties imposed by Halt, an organization combating juvenile crime, from March 16 until April 6, 2020 have been suspended. Halt-employees conduct conversations with juveniles via video communication or telephone as much as they can, in order to allow this part of the Halt-penalties to continue as much as possible. Since March 16, community service on probation is also suspended until at least April 6, 2020. Probation officers keep in touch via telephone, but house visits are cancelled.
Access to care facilities for asylum seekers (COA-locaties in Dutch) has been limited. To limit further spread of the coronavirus, asylum seekers who arrived in the Netherlands after March 15 are no longer allowed access to COA care facilities. Contact has been reduced to a minimum. There is no registration and identification taking place and also no questioning by the Dutch Immigration Service, the Immigratie- en Naturalisatiedienst (IND). Advice by the Immigration Service has been limited to emergencies. The COA care facilities follow the advice given by the Netherlands National Institute for Public Health and the Evironment (RIVM) to protect the health of COA-employees as much as possible. Further measures are elaborated as soon as possible.
Many businesses will feel the consequences of the coronavirus. Most likely, the virus will cause a lower profit than expected at the start of the year. Therefore, it is important for entrepreneurs to have their provisional assessments for income tax and corporate tax over 2020 adjusted.
Businesses eligible for income or corporate tax will receive a provisional assessment by the Belastingdienst, the Dutch revenue service, at the beginning of the year. This assessment is based on figures of previous years. Because of the corona crisis, many businesses will see a large drop in profits for 2020. Therefore, it is sensible to have the provisional assessment adjusted with a lower assessed profit. The Belastingdienst will answer these requests.
Lowering the provisional assessment has a positive effect on the liquidity of businesses. When the amount on the new provisional assessment is lower, the Belastingdienst will refund the difference. Eventually, businesses will file their income or corporate tax returns after the year has passed and the amount on the provisional assessment will thereby be settled.
The adjustment of the provisional assessment can easily be requested via the portal on the website of the Belastingdienst. Go the ‘Mijn Belastingdienst’ or ‘Mijn Belastingdienst Zakelijk’ and log on. If a business is not able to log on to ‘Mijn Belastingdienst Zakelijk’ via eHerkenning, the request can also be filed using the online form ‘Verzoek tot wijziging voorlopige aanslag vennootschapsbelasting 2020’. Filing a request is also possible via a special software package or via the tax consultant of a business.
During economic setbacks, freelancers are usually the first affected. To prevent hardships for freelancers as the result of the coronavirus, the Dutch cabinet has offered an additional benefit for livelihood and business capital. This measure is part of the ‘emergency measures for jobs and economy’, announced on March 17, 2020.
Because of all the measures taken to combat the coronavirus, many self-employed are missing out on income. These include e.g. freelancers working in the hospitality or culture industry. To ensure they do not become financial victims of the coronavirus, they can apply for a additional benefit for livelihood and/or business capital. This temporary measure will go into effect as soon as possible for a period of three month and will be executed by the municipality.
The benefit for livelihood will supplement the income up to the social minimum. A freelancer can also appeal to a loan for his capital to settle liquidity problems. The temporary regulation is based the Besluit bijstandsverlening zelfstandigen (Bbz), an agreement for financial support of self-employed. There is no check for viability, meaning applications can be dealt with quickly.
Within four weeks (normally max. 13 weeks) financial support in livelihood will be provided for a period of three months. Advance payments are possible. The maximum amount of financial support is €1,500 per month (net amount), depending on income and living conditions (i.e. living alone, sharing a house, married etc.). The support does not have to be refunded. Also, there is no check of assets or a reduction based on income of a partner.
The faster procedure also applies to loan request for capital up to €10,157. When granted, there will be a possibility to defer repayment of the loan. Also, the interest rates will be lower than those included in the Bbz at the moment.
The Dutch cabinet has decided to temporarily lower the interest on tax and tax collection to 0.01%, as mentioned in the emergency measures presented by the government on March 17, 2020 to mitigate the consequences of the coronavirus.
The imposition of interest on tax and tax collection is an important tool for the Belastingdienst to have taxes paid on time. However, the cabinet has decided that this tool is undesired in this time of crisis and has therefore implemented a temporary adjustment. This means the interest rate has been lowered to 0.01%. It was impossible to lower the rate to 0% for implementation-related reasons. The mentioned emergency measures will go into effect as soon as possible. Below, you will read their effect on the interest on tax and tax collection.
A business has to deal with interest on tax when the Belastingdienst can only determine a assessment too late because the tax return has not been filed in time or because the tax return is incorrect. In that case, the interest on tax is 4% and for corporate tax even 8%. To prevent the imposition of interest on tax in this difficult time, the Dutch cabinet has decided to lower the interest rate for all taxes to 0.01%. For implementation-related reasons, this reduction will go into effect on June 1, 2020. The reduction for interest on income tax will go into effect on July 1, 2020.
The interest on tax collection only goes into effect when a business doesn’t pay an imposed assessment in time. When a business is too late, an interest on tax collection of 4% goes into effect from the moment the payment deadline has passed. The cabinet will also lower this interest to 0.01%. This reduction goes into effect on March 23, 2020 and applies to all taxes. It is not yet know how long this reduction of interest on tax and tax collection will remain in effect. With this reduction, the cabinet aims to make it easier for businesses to request a tax deferral.
With the coronavirus around, many organizations and freelancers are facing financial problems. For this reason, the Dutch cabinet has announced a set of measures. The goal of these measures – which are in effect for at least the next three months, but perhaps longer – is to prevent bankruptcy and unemployment. Some measures had already been made public, but there are also many new ones.
During the press conference on the emergency measures, two types of measures were announced: measures to reduce wage costs for employers and measures to secure the liquidity of organizations and freelancers. It had already been announced that small and medium-sized organizations facing financial trouble as a result of the coronavirus could count on help, as the Dutch cabinet will stand surety for any loans via the regulation BMKB. Also, there was already an expansion of the short-time working regulation (Werktijdverkortingsregeling WTV). But more measures have now been announced.
Because already 78,000 requests for short-time working had been filed and the old system wasn’t able to cope with this peak in request, the regulation has been revoked immediately. At the same time, work is being done to implement and make available a new, temporary emergency measure called Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW). Already filed request for the old regulation are treated as requests for the new regulation. The latter ensures a compensation of max. 90% of wage costs. In addition, temporary support for freelancers is made available, who will receive an additional benefit for livelihood and/or working capital. Also, there is a adjustment in the WW-premiedifferentiatieregeling (the new regulation on unemployment premiums.
The keep up the liquidity of organization, an emergency online portal has been created which allows organizations with a temporary absence of clientele to request a gift. Also, it is possible to defer tax payments and the Belastingdienst has suspended the regulations on tax collection. Default surcharges are not imposed at the moment, tax interest is reduced to 0.01% and there is a deferment of energy tax. Organization can also file a request for a lower provisional assessment when they expect less profit as a result of the coronavirus. Because bars, cafés, restaurants and such are closed, municipalities will compensate due lodging tax.
Since 2009, organizations having trouble to obtain loans and bank guarantees can use the GO regulation (GO-regeling in Dutch). With this regulation, the Ministry of Finance assists SMEs as well as (medium) large businesses by ensuring a 50% guarantee on loans and bank guarantees starting at €1.5 million up to €50 million (at the moment) per organization. In the emergency measures announced, the cabinet promises to provide all leniency on the size of guarantees needed, in order to give organizations with a promising prospect the opportunity to obtain enough finance. Providers of smaller amounts of credit, like Qredit, can also count on governmental support of max. €6 million to assist organizations troubled by the corona crisis.
The short-time working regulation WTV has been suspended immediately. In its place will be the temporary regulation Tijdelijke noodmaatregel overbrugging voor werkbehoud (NOW). Employers can request a compensation of max. 90% of wage costs.
A few weeks ago, the Dutch cabinet announced that the short-time working regulation WTV also applies to organizations experiencing problems as a result of the coronavirus. Within no time, the number of requests skyrocketed. Moreover, the regulation is not adapted to deal with the drastic consequences the coronavirus COVID-19 has on organizations. For these reasons, the cabinet decided to suspend the WTV and replace it by a new, temporary regulation: de Noodmaatregel overbrugging werkbehoud (NOW). This regulation is part of the measures announced by the cabinet to reduce the consequences the corona crisis has on organizations and employers as much as possible.
The Ministry of Social Affairs and Employment has made the main features of the temporary regulation (NOW) public. The regulation itself still has to be elaborated. The main features are:
Businesses which see their income partly or completely disappear because of the measures by the government to combat the coronavirus can make use of an emergency aid. They can request a compensation of €4,000.
The cabinet is still working on the precise conditions, but it is already clear the compensation is meant for e.g. entrepreneurs in the hospitality industry or other industries where the requirement to keep a distance of 1.5 meter will lead to problems. For example barbers or beauty specialists are in close contact with their customers and have to stop their activities due to the required distance. For them, it is not possible to catch up the missed income after the corona crisis.
These entrepreneurs receive no income at the moment but do have their standing charges and already made expenses. Therefore, they can request a gift of €4,000 for a period of three months. This is part of the emergency measures. Only entrepreneurs running a business in a location other than their own home are eligible for the compensation.
An employer can continue the accrual of pension for his employees unaltered when he has to implement a temporary reduction of working hours for them because of the coronavirus, as written by the Centraal Aanspreekpunt Pensioenen.
The coronavirus doesn’t only cause many employee to work from home, but some aren’t able to do their work altogether. This is why some employers implement a temporary reduction of working hours. This reduction consists of free days an employee is entitled to according to the CLA, the Staff Regulations or his contract. The Centraal Aanspreekpunt Pensioenen (CAP), the advisory website for pension laws and regulation, answers the question which possibilities exist to continue the accrual of pension when a temporary reduction in working hours is implemented. The CAP writes that an employer who temporarily implements a reduction in working hours can continue the accrual of pension unaltered, even when an employee works fewer hours.
During the period of reduced working hours, the employment can stay as it is. An employer may continue the accrual of pension unaltered. The wages on which the accrual of pension is based may be lower, but that is no problem when it involves a regular pay cut. In such case, the accrual of pension can be continued based on the wages of the employer before the reduction in working hours was implemented.
When a reduction in working hours is implemented, the employment can also temporarily be (partially) ended. The employee can then receive a benefit in lieu of his wages, such as an unemployment benefit (WW-uitkering in Dutch). Also in these circumstances, an employers may continue the accrual of pension based on the wages the employee received prior to the reduction of working hours; however, this is not obligatory. It depends on whether the employee accruals a pension for 100% and on who pays the premiums.
The last possibility is a reduction of working hours in which there is no voluntary dismissal or a benefit for the employee to replace his wages. In such case, the accrual of pension is normally terminated, but now the employer can decide to voluntarily continue the accrual.
Qredits, the non-profit service providing financing to small Dutch businesses, has financed approximately 20,000 start-ups and small business entrepreneurs in the last few years. As right now especially small and vulnerable businesses are tormented by the coronavirus, the Dutch cabinet joins in financially.
With a record amount of over €400 million, Qcredit has supported businesses the last few years, making it the largest credit provider in the Netherlands in the field of alternative financing. Qredit offers loans to small and medium sized businesses (SMEs) in almost any branch and industry. Most credit is provided to the hospitality industry. Right now, especially that industry has great difficulty.
Qredits also offers a special type of credit to entrepreneurs with a social goal. With this idealistic goal, the credit provider differs from regular banks, amongst others with respect to special personal attention to the entrepreneurs and the development of their business plan. This type of business is often characterized by a lack of financial reserves.
To reduce the risks of this group of entrepreneurs and to continue alternative financing, the cabinet is prepared to support Qredits financially with an amount of max. €6 million, to support the businesses affected by the corona crisis. This support will be in effect for a term of nine months. The application deadline is the end of May 2020. This measure is part of the set of emergency measures, announced on March 17, 2020.
The rules for the application of the new low Unemployment Act premium (WW-premie in Dutch) are in practice a burden because of the special circumstances caused by the coronavirus. This is why the Dutch cabinet has included a relaxation in its emergency measures.
As of January 1, 2020, your organization no longer pays a sector-dependent premium through the Employee Insurance premiums (premies werknemersverzekering in Dutch), but instead a high or low Awf-premium. The lower premium (2.94% in 2020) only applies to employees with a permanent contract and a fix number of working hours. And when an employee has worked more than 30% overtime in one calendar year, your organization must still pay a high premium (7.94% in 2020) for them in retrospect.
Because of the coronavirus, it is all hands on deck in some organizations – for example in the (health) care industry – and it would be unfair when, because employees are working overtime on a large scale, this would force employers to pay a high Unemployment Act premium in retrospect. This is why the Dutch cabinet has promised an adjustment to take away this unwanted effect. The Ministry of Social Affairs and Employment still has to elaborate this adjustment. It will only be in effect for the calendar year 2020.
Employers are also given extra time to ensure their administration meets the requirements for the application of the low Unemployment Act premium. They were required to have a written proof in their administration by April 1, 2020, to apply the low premium for the entirety of 2020 for employees already under a permanent contract before 2020. However, because many organizations are not running as usual at the moment, it is in practice not always manageable to meet those requirements in time.
The cabinet has therefore extended the deadline to meet the requirements for the low Unemployment Act premium to July 1, 2020. On June 30, 2020, your organization must still have completed the administration of those employees who were under a permanent contract by December 31, 2019. If this requirement is not met, than the high Unemployment Act premium is still in effect in retrospect for the respective employee(s).
Because schools and daycare facilities are closed due to the coronavirus, employees are looking for solutions for their children and their work. When they cannot continue their work from home (entirely), they may be forced to take a leave or days off for a vacation.
Because all of a sudden an employees have to look for daycare options for their children, they can opt for ‘calamity and other short-term leave’ (calamiteiten en ander kort verzuimverlof in Dutch). This is paid leave. The employee takes this leave for the time needed to find a solution for the urgent problem. The leave is short-term, no more than a few days, and therefore provides no long-term solution. An employee able to work from home does not have to take this type of leave.
When an employee cannot arrange daycare for his children and isn’t able to do (all) work from home, then he has to find an alternative together with his employer. This alternative will probably be vacation days or parental leave. However, because of the exceptional circumstances, the employer may decide to continue paying (part of the) wages
When a child is home and sick – perhaps due to COVID-19 – then an employee can take care leave for the necessary care. There are two types: short-term and long-term care leave. Per year, short-term care leave is in total max. twice the weekly work hours. During this leave, the employee receives at least 70% of his wages, with the statutory minimum wage as the minimum. During long-term care leave – per year, a total of max. six times the weekly work hours – the employee receives no wages. But of course, in this situation there is also the option of taking remaining paid vacation days.
The hay fever season will start early this year. Unfortunately, some hay fever symptoms resemble the symptoms of a coronavirus infection at first glance. Yet, there are also important differences, so it is a good idea to continue asking questions before labeling someone a coronavirus patient.
People with hay fever are easily recognized, because they sneeze and sometimes cough a lot. As the hay fever season starts early this year, those allergic to alder and birch pollen can already experience complaints. Usually, this involve sneezing, but some also experience shortness of breath and coughing. The last two symptoms are also linked to a coronavirus infection. At first glance, employees with these symptoms who are still going to work should be sent home immediately. However, asking more questions is a good idea, because there are noticeable differences between hay fever and a coronavirus infection.
First of all, someone with hay fever doesn’t actually have a fever. On the other hand, someone infected by the coronavirus does have a noticeable fever. Second, people with hay fever often have itchy eyes. This is a symptom specific to hay fever and not present at all in a coronavirus infection. Third, the symptoms of hay fever will quickly decrease once hay fever patients are indoors. For people with a coronavirus infection, the symptoms will remain both indoors and outdoors.
The works council has an advisory right in ‘important’ decisions. But when is a decision important? Are the measures implemented because of the coronavirus important enough?
When a director wants to implement an ‘important’ decision, he has to present this to the works council first. This is stated in article 25 of the Works Council Act (Wet op de ondernemingsraad (WOR) in Dutch). The first clause of this article mentions a list of situations where this applies, but when is a decision ‘important’? The WOR does not provide a conclusive definition of ‘important’. There are, however, a few guidelines:
The criteria above are also applicable to the policy on the coronavirus. The measures taken because of COVID-19 are not commonplace, have far-reaching consequences for the organization and affect a large portion of employees; i.e. working from home, reduction of working hours, dismissals and even suspension of all business activities. Before a director can implement such measures, he has to get advice from the works council under normal circumstances. However, because the coronavirus causes circumstances to be exceptional, the question remains if the advisory right of the works council is applicable. After all, the measures and adjustments taken at the moment are not structural, but temporary. However, the works council should not sideline itself and assist the director in limiting the damage of the corona crisis to the organization.
An involved works council does not wait until the director asks for advice or comes with a decision the works council has to vote on. Instead, the works council is in the position to submit a proposal to the director. This right to initiative is regulated by article 23, clause 3 in the WOR. It is a good idea for the works council to talk to employees to see how they are dealing with the developments in the corona crisis, to subsequently discuss appropriate measures with the director. Is all information about the corona crisis clear? Do employees understand what the director expects of them? In all of this the works council can support both the director and employees.
When an employee has to work from home – for example because of the coronavirus – his/her employer may not arrange the workplace at home tax-free. Various conditions apply.
When arranging a workplace at home, not only the Working Conditions Act applies, but also various fiscal rules: an employer may not provide or lend the employee working from home a chair, desk, internet connection or mobile phone tax-free. Especially now that the coronavirus outbreak causes many employees to work from home, it is important to known all financial consequences.
Work-related provisions appropriate to the working conditions policy effective in your organization are exempt from tax. This means an employer may provide or lend these tax-free without affecting the amount of non-taxable expenses (vrije ruimte in Dutch) an employee is entitled to. However, a few conditions apply:
When an employee needs a laptop, smart phone or tool for his workplace home, then these can be provided or lend tax-free when the necessity criterion is met. This applies to all sorts of tools, computers, mobile communication devices and means and similar equipment. The criterion is met when:
When the internet at an employee’s home meets the necessity criterion, then the payment of the subscription fees are also exempt from tax. In case of a combination package of e.g. internet, telephone and television, only the part of the invoice applicable to the internet connection may be paid tax-free without affect on an employee’s non-taxable expenses.
The Netherlands is in the top 3 economies which have been hit the hardest by the coronavirus. This is mostly due to the “extreme open economy with a relatively strong connection to China,” according to Euler Hermes. This estimate by the credit provider was made even before all emergency measures had gone into effect.
According to Euler Hermes, only the economies of Taiwan and South Korea will suffer more damage than the Netherlands. China is left out of consideration in the estimates by the credit provider. Euler Hermes estimates that because of the coronavirus, worldwide $320 billion dollars will be lost each three months in commerce and services. The credit provider claims the following industries will be hit the hardest: the chemical industry, transport, the automotive branch, the textile industry and electronics.
The coronavirus will have a strong impact on Dutch business. As an example Euler Hermes mentions the harbor of Rotterdam, the largest harbor in Europe. Here, 45% of contains are either shipped to or come from Asia. Fewer ships from China will therefore have a direct impact on businesses in the Netherlands. And because of the mandatory closure of all hospitality-related businesses since March 15, such as cafés, bars, restaurants, etc., the economic damage for Dutch businesses will only increase further.
According to Euler Hermes, especially businesses that were already weak will experience the consequences of the coronavirus; but also fast-growing businesses. For those businesses, payment terms will be extended and the request for payment regulations will increase, resulting in liquidity problems.
On March 12, the Dutch cabinet announced economic measures for entrepreneurs who have end up in financial problems because of the coronavirus outbreak. They can request the Belastingdienst for an exceptional deferral of payment for their tax debts. Also, the regulation Borgstelling MKB, where the government will partly stand surety for SMEs borrowing money, will be extended.
An entrepreneur forced to request a deferral of payment because (s)he can no longer pay the tax debts is required to include a statement of a third party expert when requesting a deferral of more than three months. The expert must declare that there are temporary payment problems and that the business is viable.
In the letter with economic measures because of the coronavirus by the Ministry of Economic Affairs on Thursday March 12 it was also mentioned that businesses could request an ‘exceptional deferral of payment’ (bijzonder uitstel in Dutch) of tax debts. On the website of the Belastingdienst this is elaborated on (only in Dutch). When a business does not need a deferral of more than three months, no statement by a third party expert is required. However, when a business does need a deferral of more than three months, a statement by a third party expert must be included in the request. The statement does not have to be send along with the request. It can be send separately up to four weeks after the request was sent.
In the statement, the third party expert must declare the following:
The following qualify as a third party expert: the in-house accountant/tax specialist/financial advisor, an external consultant, external financer or the branch organization. The request for exceptional deferral of payment together with a motivation and third party statement must be sent to: Belastingdienst, Mailbox 100, 6400 AC Heerlen.
More and more organizations make an appeal to the regulation for short-time working, as written by minister Koolmees, Ministry of Social Affairs and Employment, in a letter to the Dutch lower house. Both the UWV and the Ministry are doing their best to process all requests.
Employers who have less work because of the coronavirus can be eligible for the regulation for short-time working. A few weeks ago the Dutch cabinet announced that the regulation also applies to employers forced to reduce working hours due to the coronavirus outbreak. In his letter, minister Koolmees of the Ministry of Social Affairs and Employment wrote that the number of requests increases rapidly, with 1,700 requests on March 11. By March 13, 5,000 organizations had filed a request. In comparison: normally there are on average 100 to 200 requests each year.
Short-time working is a regulation which allows employers who have less or no work temporarily for (part of) their employees because of exceptional circumstances, i.e. falling outside the limits of regular entrepreneurial risks. An employers who can demonstrate that in a period of 2 to max. 24 weeks 20% of available employees cannot be put to work can request a permit for short-time working with the Ministry of Social Affairs and Employment. When granted by the ministry, the employer can claim Unemployment benefits (WW-uitkeringen in Dutch) for the hours not worked by his employees once the permit expires. This way, an employers can reduce his/her loss in turnover.
The minister has employed more personnel to process all requests. The UWV also works on an increase in manpower. When this turns out not to be enough, the minister will look at other possibilities, although he hasn’t unveiled what these are. The employer can only request short-time working for regular employees. No short-time working can be requested for on-call workers with a zero-hours contract and temporary workers. Also for workers already sick before the term of the permit goes in effect no Unemployment benefits can be received. For these employees, the employers must continue paying wages for the duration of their sickness as regulated by law.
Now that the government has advised to work from home as much as possible, a new situation arises for most offices. Of course, this leads to questions. Which work-related matters will play a role in the upcoming period?
The Dutch government has requested organizations to let employees work from home as much as possible in the upcoming period – at least until the end of March. Such a situation is pretty unique and therefore there is no plan of action ready. Yet, there are a few things that must be taken into consideration. For example, organizations where part of the employees are still present in office must ensure there are enough in-house emergency response officers (bhv’ers in Dutch) for those employees. It is therefore recommended to set up a schedule for this.
Employees able to work from home must have an appropriate workplace at their disposal. Important here is whether the employer requires the employees to work from home or offers it as an option. When it is required, the employer has duty of care and must ensure the arrangement of the workplace at home meets the requirements set by the Working Conditions Act (Arbowet in Dutch). The employer can then put free provisions such as a laptop stand, an ergonomic mouse and a proper key board at the disposal of employees. In addition, the workplace has to be recorded in the Risk Assessment and Evaluation (RI&E in Dutch). In that case, the inspection of the Ministry of Social Care and Welfare also has the right to come and assess the workplace.
When working from home is an option for which an employee can decide him-/herself, than the employee must ensure him-/herself that the workplace is comfortable, well-lit and quite with a proper chair and desk. Preferably, work will be done using a separate, large monitor or a laptop stand and an ergonomic USB key board, because the Working Conditions Act proscribes the use of a small laptop all day. Also at home, alternating between work and a break is a part of the workday. For employees unable to work from home, the employer will keep the office opened or arrange an alternative workplace.
Entrepreneurs facing liquidity problems as a result of the coronavirus epidemic can request the Belastingdienst for an ‘exceptional deferral of payment’ (bijzonder uitstel in Dutch) of their tax debts. This deferral can be requested for income tax, corporate tax, VAT and payroll tax.
The cabinet has announced economic measures to help entrepreneurs who have ended up in financial trouble because of the coronavirus outbreak. Besides an expansion of the regulation Borgstelling MKB – a regulation where the government will partly stand surety for SMEs borrowing money – businesses can also request an exceptional deferral of payment of their due taxes. For this, they have to send a written motivation, stating that they got into financial trouble because of the coronavirus, to the Belastingdienst.
When the request of exceptional deferral of payment is registered by the Belastingdienst, all tax collection actions are suspended immediately. A check of these requests will be executed at a later stage. Any penalties for not paying taxes (in time) will be revoked. Businesses expecting a lower turnover can request a reduction of the income tax or corporate tax over 2020 on their already received provisional assessment. The Belastingdienst will grant these requests.
Three ministries have jointly declared in a letter that small and medium sized businesses affected financially by the coronavirus can get help. The cabinet is going to (partly) stand surety for loans taken by these businesses in order to survive. This measure has to be realized within two weeks.
At the moment businesses active in the hospitality industry, tourism and event branch are the ones primarily noticing the effects of the coronavirus. When they have ended up in financial trouble because of the virus, they can get a loan at attractive conditions to bridge the difficult time that lies ahead.
Three ministries have declared in a letter that they intend to extend the existing regulation Borgstelling BMKB to also include businesses struck financially by the virus. With a surety loan, the ministry will partly stand surety for businesses who want to take out a loan but cannot give the financer enough certainty. There will be a new, temporary measure (in effect until April 1, 2020) in which the government offers to stand surety for a higher part of the loan. In the current regulation, the surety is 50% of credit provided by the financer. The government vouches for 90% of the surety. In the new regulation, the surety is increased to 75%. Businesses can appeal to this new regulation when taking out a bridging loan or with an increase in bank overdraft, with a duration of max. one year. In addition, a few other conditions in the old regulation Borgstelling BMKB will be relaxed. The other ministries are also looking into ways to help out entrepreneurs with regulations. A regulation for short-time working has also already been implemented for businesses that had to reduce the working hours of employees due to exceptional circumstances.
Organizations want to arm themselves against (the consequences of) the coronavirus COVID-19. In order to do this it is important that they base their organization policy on reliable information. Which websites can they consult?
COVID-19 currently has a grip on the entire world. The advice on the coronavirus changes each day. These fast developments pose a challenge to organizations that like to survive the crisis as well as possible. The Netherlands Society of Occupational Medicine (Nederlandse Vereniging voor Arbeids- en Bedrijfsgeneeskunde) mentioned a few websites on which up-to-date and reliable (medical) information about COVID-19 can be found. For the latest preventative advice, the website of the Netherlands National Institute for Public Health and the Environment (Rijksinstituut voor Volksgezondheid en Milieu or RIVM) is the right place to go. Also the World Health Organization (WHO) advices on preventative measures.
An employer who’s wondering whether or not to cancel business trips should consult the website nederlandswereldwijd.nl for travel advice. For more general questions and answers about the coronavirus, (s)he should go to rijksoverheid.nl. In addition, employers organizations – such as VNO, NCW, MKB-Nederland and AWVN – have jointly published a guide.
Of course, organizations can visit rendement.nl/engels/coronavirus for information in English. On our website, you will be informed on the consequences of the coronavirus at work and the measures organizations can take. Relevant information is bundled together, allowing you to learn more in-depth and professional information about the coronavirus.
The fact that an employee has to work from home for an extensive period of time does not automatically mean that his/her employer cannot reimburse travel expenses tax-free. There are, however, strict conditions to continue the reimbursement of travel expenses for e.g. employees in isolation because of the coronavirus.
For reimbursement of travel expenses, a strict exemption is in effect. This is either €0.19 per kilometer or the costs of public transport. When an employer reimburses travel expenses in retrospect on the basis of declarations, (s)he will of course receive no declarations from employees who haven’t traveled. Employees in corona-quarantine therefore receive no reimbursement.
When an employer reimburses a fix amount of travel expenses to his employees, then a special rule goes into effect during an extensive absence. The employer may continue the fixed reimbursement for max. 6 consecutive weeks. And when the employer expects the employee to be absent for a longer period, (s)he may continue to give the fixed reimbursement tax-free for the current and next calendar month. When the employee returns to work, then the employer may only reimburse travel expenses starting the month after the month the employee returned.
For the reimbursement of travel expenses tax-free, the following conditions apply:
Because of the infection risk of the coronavirus COVID-19, many people are instructed to work from home at the moment. To facilitate working from home, Google and Microsoft temporarily offer the Home Office software for free.
Few have missed the news that the coronavirus has also reached the Netherlands. Perhaps therefore you are now instructed to work from home a few days per week. Or perhaps you are now in quarantine to avoid the risk of infection. To facilitate working from home, Google and Microsoft temporarily offer their Home Office software for free by extending the trail periods.
The goal of this free action is to facilitate working from home for organizations and schools. Worldwide, users of Google’s G Suite can use paid apps for free until July 1, 2020, such as Google Drive to record and save meetings. Also Hangouts Meet can be used for free now, for example for video conferences with a maximum of 250 participants or for live streams with a maximum of 100,000 viewers.
For the next half year, Microsoft will give away free trials of advanced, paid functions of Microsoft Teams. These are apps of the premium version for online meetings, chats, sharing files and video conferences. Although the trials were originally intended for hospital, schools and organizations in China only, now they are available worldwide.
An employer who intends to take actions against the spread of the new coronavirus must adhere to the privacy laws. He may not process medical details of employees, nor measure them for fever.
Medical details are listed as ‘special personal details’ (bijzondere persoonsgegevens in Dutch) and are therefore protected more strictly. The General Data Protection Regulation (GDPR) states that an employer may only register special personal details when (s)he has a good reason to do so, or in legal terms: when (s)he has a legal basis. The Dutch authority of personal details (Autoriteit Persoonsgegevens), the institution for the protection of personal details, also follows this rule with respect to the coronavirus (COVID-19). The employer may register an employee reporting sick, but (s)he may not ask about the nature and cause of the sickness or register this information, even when the employee provides this information him-/herself.
An employer aware of a corona infection of one of his employees may not register this information in his/her administration because there is no legal basis. The employer is also not allowed to tell other employees, unless the infected employee gives permission for this. So what can an employer do? The employer may talk with an employee about a possible coronavirus infection, for example when this person has symptoms of a cold. However,he can do nothing with the personal medical details. Only the occupational doctor can do so. The employers may ask an employee if (s)he has been in a high-risk area and instruct him/her to work from home on the basis of the answer. And of course an employer can inform employees about the symptoms of the coronavirus and which actions should be taken for hygiene, such as washing your hands regularly.
The Dutch authority of personal details prohibits the employer from checking the body temperatures of employees. An employer is allowed, however, to refer an employee who is suspected of a coronavirus infection to the occupational doctor. The doctor can then check if there is indeed an infection. When this is the case, the occupational doctor should instantly contact the regional GGD, the municipal health service. The authority on personal details emphasizes that it is the job of the government, together with the GGD, to prevent a further spread of the virus, including at the workplace. Therefore, it is important that everyone follows the advice of the regional GGD and the Netherlands National Institute for Public Health and the Environment (Rijksinstituut voor Volksgezondheid en Milieu or RIVM).
Many employers are taking measures to combat the spread of the coronavirus. Because these measures are an addition to or adjustment of the existing regulations of working conditions, the works council has a right to vote.
The coronavirus has reached the Netherlands and therefore also the workplace. Many employers have started to take measures to prevent the spread of the virus. In addition to extra measures to improve hygiene, many employers advice employees to work from home or to avoid traveling by public transport during rush hours. According to article 27, clause 1d of the Works Council Act (WOR in Dutch), the director is required to ask the works council to vote on a new regulation or an adjustment or revocation of an existing regulation on working conditions, absenteeism or re-integration policies. The policies on the coronavirus are thus included.
The works council’s right to vote also applies when the employers adheres to the advice of the Netherlands National Institute for Public Health and the Environment (Rijksinstituut voor Volksgezondheid en Milieu or RIVM). The right to vote is only revoked when this is legally agreed or included in the regulations in the CLA. This does not apply when advice is asked. Moreover, employers still have room to decide for themselves how to put the advice in practice.
When voting on a regulation, the works council must assess in which way the proposes measures are in line with the advice of the Netherlands National Institute for Public Health and the Environment. In addition, the works council can inform and advice the director on any particularities for certain groups of employees. For example, do all employees have the possibility to work from home? What are the alternatives when working from home isn’t an option? In addition, the works council must safeguard the rights of employees. For example, an employer is not allowed to force an employee take his paid vacation days, e.g. because the employee is in quarantine or because working from home isn’t an option: in case schools and daycare facilities close, the employee is entitled to ‘calamity and other short-term leave’. Moreover, the director must adhere to the privacy laws when taking measures.
The new coronavirus has reached the Netherlands. Organizations must therefore arm themselves against COVID-19, for example by instructing employees to work from home. When employees are forced into quarantine because of the coronavirus, who will pay for the costs?
The employer is required to arrange a safe workplace. Also, (s)he must inform employees about the risks of the new coronavirus and implement hygiene protocols. Working from home reduces the chance employees infect each other. However, there are various factors that come into play to decide whether or not employees can and are allowed to work from home. The employers has to decide together with the employee per case what is desirable. When there is a well-founded fear an employee is infected, the employer can oblige the employee to work from home – for example, when the employee has visited a high-risk area.
An employee who has been reported sick and must stay in quarantine has the right to continued payment of wages. Employees who do not yet show any symptoms but must stay in quarantine, for example because there has been contact with an infected patient, also have the right to continued payment of wages. This also applies to employees quarantined abroad. The days spent in quarantine cannot be subtracted from his/her vacation days. The only exception is when an employer can prove that the employee bears the risk of infection, but this will be very difficult to prove.
Schools can opt to close temporarily because of the risk of infection. It can take a while before an employee has arranged daycare for his/her child(ren). The employee way be entitled to ‘calamity and other short-time leave’ (calamiteiten en ander kort verzuimverlof in Dutch). The employer will then continue the payment of wages during the leave. The duration must be as short as possible and ends when the employee has found a daycare option. When the employee need a leave of a longer duration (s)he can, in consultation with the employer, take vacation days or ask for an unpaid leave.
An employer who, as a result of the coronavirus, temporarily has less work can request a short-time working regulation. The employer will then receive an Unemployment benefit for his employees for the hours not worked and continues full payment of wages to them.
The new coronavirus has also set foot on Dutch soil. For organizations, this leads to question as to what they can do to prevent infections. Most important are measures to increase hygiene and provision of instruction and information to employees.
Now that corona infections have been determined in the Netherlands, organizations want to know how to deal with this new challenge. To reduce the chance of infections, it is important for organizations to take extra measures for hygiene and to inform employees on this as well as possible. Organization can:
Employees themselves can also take steps to make the change of infection as small as possible:
Mouth masks aren’t mentioned in the above lists. Experts tell us that these aren’t of much use in everyday situations. When used incorrectly, they may even contribute to the spread of the virus. This happens when mouth masks are used for too long or are grabbed on the wrong side, causing the virus to end up on the hands. Medical staff do wear mouth masks, but firstly these are profession masks and they are replace very often, and secondly these employees are much more exposed to the virus because of their contact with people already showing symptoms of infection.