Netherlands: Restricted scheme for part-time unemployment benefits introduced from 20 July 2009

January 10, 2009

Background

This scheme allows employers to make employees redundant on a ‘part-time’ basis for a limited period.  The benefit for an employer is twofold, in that there is an immediate reduction in salary expenses but the experienced and trained workforce is retained.  For the employee, the downside of being made redundant on a ‘part-time’ basis is mitigated by him being allowed to claim a “part-time unemployment benefit.”  In order to be able to qualify for the restricted scheme, an employer must be able to demonstrate that the turnover of his business has been severely impacted by the credit crisis.

The initial scheme for part-time unemployment benefits (in Dutch: “Deeltijd WW”) was recently withdrawn because the EUR 375 million limit had been reached.  However, from 20 July 2009, companies may now use a more restricted version of the initial scheme for part-time unemployment benefits (“scheme”).  The Dutch government wants to raise awareness and ensure that companies consider more carefully the manner in which they use the scheme so that more companies will be able to participate.

Changes introduced

The following changes have been made:

Other conditions, such as the agreements which have to be concluded with the unions, remain the same as under the initial scheme.  The budget for the scheme has been increased from EUR 375 million to EUR 950 million.

For further information, please contact Klaas Wiersma (klaas.wiersma@loyensloeff.com) on +31 20 578 57 85.

This article was produced by, and re-produced with kind permission of, our correspondent firm in The Netherlands, Loyens & Loeff N.V. www.loyensloeff.com

Loyens Leoff

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