Reduction of work hours

Unemployment benefit during reduction of working hours

This information is provided by the Netherlands Enterprise Agency, RVO

If you run a business in the Netherlands and you don’t have enough work for your staff due to exceptional circumstances, such as the Corona virus, fire, flooding or a trade boycott you can apply for a reduction of working hours (werktijdverkorting, WTV) permit. This permit enables you to apply for temporary unemployment benefit for your employees. The workers concerned will still be employed by your company.

When do you qualify?

You can apply for a WTV permit if:

  • the reduction in the volume of work is due to exceptional circumstances, such as the Corona virus, fire, flood or a trade boycott
  • you expect to have at least 20% less work for your staff for at least 2 but no more than 24 weeks
  • If you are a self-employed professional (zzp-er), you cannot use the unemployment benefit for short-time working. You may be eligible for financial support for self-employed professionals (Bbz).
  • You can only apply for the unemployment benefit during short-time working for employees towards whom you have a continued payment of wages obligation (loondoorbetalingsverplichting). You cannot apply for the unemployment benefit during short-time working for employees with a zero-hours contract, or for agency workers.

How to apply for unemployment benefit during reduction of working hours?

You apply online for a reduction of working hours permit (in Dutch) to the Ministry of Social Affairs and Work.

Please note: Are you having trouble accessing the website of the Ministry of Social Affairs and Work? In all likelihood, it is overloaded. The Ministry is working hard to solve this problem. Please try again at a later time.

If you are granted the permit, notify the Employment Insurance Agency (UWV) immediately, using this form (in Dutch).

Have you submitted an application?

Via ‘Mijnzaak’ you can find out who is handling your request, you can contact the practitioner directly. You will find the login details for ‘Mijnzaak’ in the confirmation of receipt of your request. The Ministry of Social Affairs and Employment tries to process applications as quickly as possible. The more complete the application, the faster the ministry can process it.

Renewal permit

Is there no improvement in your company after the permit has expired? Then you can request an extension of the permit. The working time reduction may not exceed 24 weeks in total.

Applying for unemployment benefit for staff

You must report the receipt of the short-time work permit to UWV immediately. After reporting and after the permit period has expired, you can apply for unemployment benefits for your staff at UWV.

UWV pays unemployment benefit to employer

UWV then reimburses the hours that the employees did not work during the permit period. This only applies to the hours for which you have a permit. If your employees meet the conditions, UWV will transfer the unemployment benefits to you. So you pay less labor costs, while your employees remain fully employed. Your employees will remain employed by you. Usually they do not notice much of the reduction in working hours financially: they simply receive their wages.

Even with unemployment benefit employees may still be disadvantaged

Suppose you work in a shoe store. You are employed and have a contract for 38 hours. But because of the corona crisis, hardly anyone buys shoes anymore. Your boss decides that you still have to work 1 day a week. He will send you home for the remaining 30 hours.

Your employer can then request a working time reduction for those hours that you are at home. You will then simply remain employed and also receive a salary. The UWV pays 70 percent of your wages to your employer and he pays that to you again.

Some employers will supplement your wages up to 100 percent. But that is not a legal obligation. In principle, you only have to pay the unemployment benefit, which is 75 percent in the first two months and then 70 percent of the wages. This will be agreed in the employment contract or in the Central Labour Agreement if one is applicable. The shoe seller then receives a 100 percent salary for 8 hours, but for the other 30 hours, after two months, he only receives 70 percent. Suppose he normally earns 2,300 euros gross per month, then he will only receive 1,755 euros. And if his employer no longer has any work for him, he will only receive 1,610 euros instead of 2,300 euros.

Also in the area of ​​the employee’s WW rights the employee may be disadvantaged. If companies still fall over, employees will be presented with a bill for the second time, because the reduction of working hours affect your unemployment benefit rights. In other words: if you have already had a period of reduced working hours, you are less entitled to ‘real’ unemployment benefits. On the other side, the social insurance premiums continue. The UWV pays gross in the event of a reduction in working hours. This includes employer premiums. The pension contributions also continue as normal, so the pension accrual is not damaged.

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