Netherlands – COVID-19 new measures scheduled for June

New scheme: Meeting the fixed costs of small and medium-sized enterprises (SMEs)

SME entrepreneurs in, among others, the hospitality industry, recreation, events, fairs, stages and theatres receive - in addition to the allowance for labour costs (NOW) - a tax-free allowance from the Ministry of Economic Affairs in order to be able to pay their fixed material costs. Depending on the size of the company, the amount of the fixed costs and the degree of loss of turnover (at least 30 percent), companies receive an allowance for their fixed costs up to a maximum of 20,000 euros for the next three months. One billion euros is available as compensation for these companies employing more than 800,000 people. The sectors affected are eligible under the TOGS scheme.

Extension and adjustment of the scheme for the contribution to wage costs (NOW)

An entrepreneur who expects a loss of turnover of at least 20% can apply to the UWV for an allowance for wage costs for June, July and August from 6 July 2020. This will enable companies to continue to pay their staff. The extended NOW scheme uses the same system of compensation, but the new scheme also contains changes.

The fixed top up will be increased from 30 to 40 percent. In this way, the NOW also contributes to costs other than labour costs. The reference month for the wage bill will be March 2020. In addition, in the NOW scheme that is already in effect, March will also be taken as the starting point if the wage bill in the months of March-May is higher than in January-March. This is important for seasonal businesses. Furthermore, a company that makes use of the NOW for this year will not be allowed to distribute profits to shareholders, pay bonuses to the board and management, or buy back its own shares.

In the current NOW, if the employer requests prior approval to give notice based on business economic reasons (and does not withdraw this request within 5 days), the wage sum for the relevant redundant employees will be increased by 50% and will be deducted from the final subsidy amount. In the NOW 2.0, the correction to the subsidy in the event of dismissal based on business economic reasons will remain in place. However, the increase of 50% of the wage sum will no longer be applied. This means that the subsidy will be reduced with 100% of the wage sum of the redundant employees rather than 150% of the wage sum. In addition, companies will have to state in their new NOW application that they will consult with trade unions if they wish to apply for dismissal of more than 20 employees on commercial grounds (with a timeframe of at least 4 weeks between notifying the trade unions and filing the request to obtain prior approval). The legal protection in the event of dismissal also continues to apply.

Employers applying for the NOW will be obliged to encourage their employees to undergo further training and retraining. Employers will make a statement about this when applying for the NOW 2.0. To support the initiatives of the social partners, the government is allocating 50 million euros for this via the crisis programme NL leert door, which will enable people to follow online training and development advice free of charge as from July in order to adapt to the new economic situation.

Conditions for extended bridging scheme for self-employed persons (TOZO)

The Cabinet is extending the relaxed scheme to support independent entrepreneurs, including self-employed persons, so that they have an increased chance of being able to continue their business. Self-employed persons can receive additional income support for living expenses from their municipality. Until the end of August 2020, this supplements the income to the social minimum and does not have to be repaid.

The extended scheme includes a partner income test. This means that only households with an income below the social minimum are entitled to a livelihood allowance. In this way, livelihood support is aimed at guaranteeing the social minimum at household level.

Support also remains possible in the form of a loan (maximum €10,157) for working capital, at a reduced interest rate. In the extended scheme, independent entrepreneurs will be asked to declare that their business is not in a state of suspension of payments or that the business is in a state of bankruptcy.

At the request of the Lower House of Parliament, the Cabinet is working on a temporary and feasible solution for dismissed flex workers who do not meet the conditions for WW or assistance. The Minister of Social Affairs and Employment will inform the House of Representatives about this separately today.

Prolongation of tax measures

The period in which affected entrepreneurs can apply for tax deferrals has been extended until 1 September 2020. Any penalties for failure to pay on time do not have to be paid. The tax interest and recovery interest for all tax assets has been reduced to 0.01% until 1 October 2020. Other tax measures, such as a relaxation of the hour criterion for self-employed persons and the payment break for mortgage obligations, will also be extended until 1 September 2020.

Entrepreneurs are immediately granted a three-month postponement of payment upon the first application. For those three months, they only have to submit a single application (for deferral of all types of tax). Entrepreneurs can also apply for a deferment for a period longer than three months. It is important that as much money as possible actually remains in the companies. In order to guarantee this extra, in the event of a deferral longer than three months, entrepreneurs must declare that they will not pay any dividends or bonuses, or buy back their own shares.

Corona credit and guarantees to entrepreneurs (BMKB, GO, KKC, COL)

The additional, extended or more accessible lending and guarantees to SMEs, start-ups and scale-ups from the first emergency package will continue. In this way, these companies will also retain or gain access to financing from banks, for example. These are the core modules of the Borgstelling Midden en Kleinbedrijf-regeling (BMKB) and the Garantie Ondernemingsfinanciering-regeling (GO), the new Klein Krediet Corona guarantee scheme (KKC) and the increased budget of the SEED Capital scheme.

The Corona Bridging Loan (COL), which contributes to improving the liquidity position of innovative companies (start-ups and scale-ups), will receive a second tranche of €150 million because of the large number of applications submitted.

Further new general measures in places from 01 June, 2020:

Groups

• Outside people are allowed to come together if they keep 1.5 meters distance from each other.
• A maximum of 30 people may gather in all buildings that are open to the public, excluding staff. 1.5 meter distance rule applies.
• At home, the urgent advice remains to keep a distance of 1.5 metres for visitors, both inside and in the garden and on the balcony.

Catering - 1 June from 12.00 noon

Restaurants and cafes may be open, subject to conditions:

• a maximum of 30 guests (i.e. excluding staff);
• visitors have to make reservations;
• Everyone keeps 1.5 meters (except people from the same household);
• in a pre-inspection meeting between the entrepreneur and the customer, an assessment is made as to whether a visit is risky.

There is no maximum number of people on terraces. However, everyone must sit at a table and keep a distance of 1.5 metres from each other (except people from the same household).

Education

• Secondary education will open on 2 June. Schools are taking measures so that a distance of 1.5 metres can be maintained. In practice, this means that not all pupils can be at school at the same time.
• Secondary special education will also open to all pupils on 2 June. Here too, schools are taking measures so that a distance of 1.5 metres can be maintained. This requires customisation and will not always be possible in this type of education.
• On 8 June, primary education will reopen 100%, unless current research shows that this is not justified.
  • The extracurricular care (shelter) follows education and will reopen on 8 June. Children will be looked after on their fixed days as agreed in the contract.
  • From 8 June onwards, emergency care (shelter) will only be available (until 1 July) for children of parents working in care (evening / night / weekend).
• On 15 June, secondary vocational education and higher education will start again with a limited number of tests, exams, practical lessons and supervision of vulnerable students at the institution.

Cultural institutions - 1 June from noon

• Film, theatre and concert halls are open under certain conditions:
  • a maximum of 30 people in the audience;
  • visitors must book in advance;
  • a check in advance to determine whether a visit is risky;
  • everyone keeps 1.5 meters distance from each other.
• Museums and monuments are open if visitors buy tickets in advance and have a check in conversation. The maximum number of visitors depends on the building. A distance of 1.5 metres must be kept.
• Music schools and centres for the arts are open. There is a maximum of 30 people per building, which must keep a distance of 1.5 metres.

Public transport

• Public transport is intended only for necessary travel.
• In tram, (water)bus, metro and train, from 1 June, travellers aged 13 and older must wear a non-medical mouth cover. This does not apply to stations, stops and platforms where a mouth cover is not compulsory. Everyone keeps a 1.5 meter distance from others here.
• Travellers who do not wear a mouth cover after 1 June may be fined €95.

See our Coronavirus (COVID-19) feature for more information generally on the possible legal implications of COVID-19.