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Details of the Emergency Measure Bridging for Retention of Work (NOW-scheme)

31/03/20

See also our article published on 7 May 2020 about the extension of the NOW scheme for groups of companies with less than 20 percent loss of turnover.

The last update of this article was on 23 February 2021.

The NOW measure, which is a temporary emergency measure for maintaining jobs (in Dutch: Tijdelijke noodmaatregel overbrugging voor werkbehoud) supports employers who are facing a substantial decline in turnover due to the corona crisis. If you have to deal with this, the NOW can provide you with a compensation for labour costs to bridge this period. To apply for this, your turnover must fall by at least 20 percent to apply for a partial compensation of the wage costs. The actual amount of the allowance depends on the extent of your turnover decrease.

The aim is to maintain as many jobs as possible that have come under pressure as a result of the corona crisis. On the basis of your application, the Employee Insurance Agency (in Dutch: UWV) will make an advance payment of 80 percent of the expected compensation in three instalments, with the first instalment being paid within 2 to 4 weeks.

The emergency measure applies to the wage bill for the period March to May 2020. However, the possibility of extending the measure by three months is kept open.

What does this mean for you?

If you meet the conditions, you can apply for a partial compensation of your labour costs. A number of elements are important for this, for example, you must estimate your decline in turnover. Based on the estimated decline in turnover, you can determine for what percentage of your wage bill you can receive compensation. This also makes the wage bill a relevant element. The UWV bases the amount of the wage bill on the data from the UWV's administration.

This is information that you submit every month via your payroll tax return. On the basis of your application, the UWV will then make an advance payment of 80 percent of the expected compensation. The advance will be paid in no more than three instalments and an attempt will be made to pay out the first instalment within 2 to 4 weeks.

Below you will find an overview of the various relevant elements.

Decline in turnover

In order to determine whether you qualify for this emergency measure, you must first estimate your decline in turnover. To do this, you divide your total turnover from 2019 by four. You compare this turnover with the expected turnover of three months in 2020. You can choose from three periods, a. March-April-May 2020 or b. April-May-June 2020 or c. May-June-July 2020. You can use these three periods to calculate the decline in turnover as a percentage.

Percentage of compensation

The amount of the compensation for labour costs depends on the decline in turnover. You can ask for a partial compensation of your labour costs in relation to your loss of turnover. A few examples:

  • if 100% of the turnover is lost, the compensation amounts to 90% of the wage and salary bill of an employer;
  • if 50% of the turnover is lost, the compensation amounts to 45% of the wage and salary bill of an employer;
  • if 25% of the turnover is lost, the compensation amounts to 22.5% of the wage and salary bill of the employer.

Wage and salary bill

The basis of the NOW scheme is the amount of the wage and salary bill from the payroll tax return of January 2020. The wage for social insurance purposes (in Dutch: SV-loon) from this return is the basis for the NOW allowance with a fixed surcharge of 30 percent for employer's costs (holiday pay, pension contributions and employer's contributions). This wage and salary bill may also include the salary of flex workers and zero-hours contracts. There is, however, a maximum wage that is compensated per employee. This maximum is 9,538 euros per employee per month, salary above this amount will not be compensated.

Group level

For the application of the scheme, the decline in turnover is taken into account at the level of the entire group to which your company belongs. If the group, however, also has foreign subsidiaries which do not pay wages qualifying for Dutch social insurance purposes, you can not include the turnover of these foreign subsidiaries in the estimated turnover. Furthermore, you must apply for the NOW compensation separately for each payroll tax number registered with the Dutch Tax Authorities.

Director-owners, international employers and employees

The NOW scheme applies to the wage and salary bill of all your employees for whom you file a payroll tax return in the Netherlands and who fall within the scope of the Dutch social insurance system. It follows from this that the wage and salary bill of a director-owner of a private company who is not insured for employee contributions, is not covered by the scheme. The wages of your international employees, however, are covered by the scheme if the employees are insured in the Netherlands under the social insurance system. Foreign employers are also eligible for the allowance insofar as they employ employees who are socially insured in the Netherlands.

Auditor's report

You must apply for the final settlement of the subsidy between 7 October 2020 and 31 October 2021. Depending on the amount of subsidy you applied for, you need an auditor’s report or a third party statement. With an advance of 100,000 euros or a final subsidy amount of 125,000 euros or more, an auditor's report must be submitted with the application for the final settlement. In the case of an advance payment of more than 20,000 euros or a final subsidy amount of more than 25,000 euros a statement from a third party is needed. In any case, you do not yet need an auditor's report or third party statement when applying for the advance payment.

Starting date 

The desk of the UWV for the advance payment will open for filing the application on Monday 6 April 2020. You can apply for the compensation of your wage and salary costs from 1 March 2020. The office will remain open until 5 June 2020. The UWV aims to pay out the subsidy within 2 to 4 weeks after the application is filed.

Social responsibility

We ask you to deal responsibly with applications for the NOW and only use this emergency measure if it is really necessary for your company and the retention of your employees.

For other points of interest regarding the consequences of the corona crisis for your personnel, we refer you to our theme page. This theme page will be updated as soon as possible with details of the NOW scheme and we will continue to add to the page when there is more information from the Dutch government.

Contact us

Nicolien Borggreve

Nicolien Borggreve

Partner, PwC Netherlands

Tel: +31 (0)62 081 66 41

Daniël Sternfeld

Daniël Sternfeld

Partner, PwC Netherlands

Tel: +31 (0)61 089 28 89

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