Employment Emergency Fund (NOW) – NOW 2.0

On March 31, 2020, the Dutch government first published the Employment Emergency Fund (Tijdelijke noodmaatregel overbrugging voor behoud van werkgelegenheid, NOW 1.0). Please read more about this here 

The initial period of the fund ended on 31 May, 2020 but allowed for a one time extension for an additional three month period. On 20 May, 2020 the Dutch government announced the extension of NOW and certain further amendments to NOW 1.0. The extension fund is called NOW 2.0. Below we discuss the key characteristics of NOW 2.0 and important changes made to the NOW 1.0.

NOW 2.0

From 6 July an employer can make an application for NOW 2.0 to the Insurance Administration Agency (UWV). The amended scheme still provides for the Government to grant a substantial contribution towards wage costs for employers experiencing a drop in turnover of at least 20% during a three month period (June-Aug, July-Sept or Aug-Oct). For employers who are applying to receive the NOW subsidy for the second time, the second period must directly follow the previous one.


Since 1 May 2020 a group of companies that experiences an overall drop in turnover of less than 20%, can apply for the subsidy in respect of a subsidiary that experiences a drop in turnover of more than 20% if:

  • the group states that it will not pay out any dividend or bonus and or repurchase its own shares during 2020;
  • the subsidiary enters into an agreement with the trade unions (where it employs 20 employees or more) or employee representatives (where it employs less than 20 employees) about maintaining the level of employment within the company; and
  • no intra-group secondment opportunity exists.

In addition certain financial requirements apply that the accountant of the company or group is obliged to check and confirm.

Dismissals on business economic grounds

The penalty which applied where an employer made redundancies during the subsidy period has been removed. Under NOW 1.0 150% of the respective redundant employee’s wage was deducted from the claimed subsidy sum if during the subsidy period an application for a dismissal permit for economic reasons was submitted by the employer. Under NOW 2.0 100% of the wage sum of the redundant employee(s) will be deducted from the subsidy amount if an application for a dismissal permit for economic reasons is submitted between 1 June and 31 August 2020. The additional 50% “penalty” therefore no longer applies.

Where 20 or more dismissals are envisaged, the rules of the Act Notification of a Collective Dismissal apply and in addition the employer who has applied for NOW 2.0 is required to consult the trade unions or the employee representative body during four weeks and reach agreement on the necessity of the proposed redundancies. Only after these four weeks can the applications for the proposed dismissals based on economic reasons be submitted.

No dividends, bonuses or repurchases of shares

A company applying for NOW 2.0 which receives an advance subsidy of EUR 100,000 or a definitive subsidy of EUR 125,000 may not pay out dividends or bonuses or purchase any of its own shares during 2020 and until the Annual General Meeting of its shareholders has finalised the 2020 annual accounts in 2021. A statement to this effect must be submitted together with the application for NOW 2.0. The prohibition on the pay out of bonuses is limited to the board of directors and higher management. Other personnel are still entitled to receive their bonus.

Surcharge to the employer contributions

Under the NOW 1.0, the January 2020 wage bill was used as the basis for calculating the level of compensation claimed. This amount was increased by a flat rate surcharge of 30%.The fixed (flat-rate) surcharge has been increased in NOW 2.0 from 30 to 40 percent. This increase in surcharge serves to compensate employers for the additional premiums and costs that employers must make, such as employer contributions, employee contributions to pension and the accrual of holiday.


Under the NOW 2.0, employers who make use of the scheme are obliged to encourage their employees to request professional development or to undergo training or participate in training to maximise job retention and/or new job opportunities. The government also sees a role here for works councils and other employee representatives to encourage participation in professional development advice or training and, if necessary, to ensure employers comply with this requirement.

The Government intends to launch the initiative “NL continues to develop”. This initiative aims to support people who are at risk of losing their work or have already lost their work as a result of the crisis. The initiative consists of career advice and online training. The government aims to launch the initiative in July 2020, which will run until the end of 2020.

Changes to NOW 1.0

Seasonal businesses

In order to accommodate seasonal companies, an adjustment has been made to the calculation of the wage bill for the subsidy of the NOW scheme. In short, for employers who had a higher average wage bill in the period from March to May 2020 than in January 2020 (at least 3 times the amount ), the subsidy will now be determined based on the wage bill in the period March until May 2020.

The new calculation method automatically applies to all employers with a higher average wage bill in the period March to May 2020 than during the month of January. Therefore, employers who have already applied for, and have been granted state support under the NOW 1.0, do not have to actively request the wage bill for the months of March to May be taken as the reference wage bill.

13th month filtered

 When the final wage subsidy is determined, the UWV will filter out the so-called thirteenth month payment. This prevents the employer from having to pay back (part of) the wage subsidy as a result of the payment of a thirteenth month in January.

Threshold for submitting an auditor’s statement

The applicant for NOW 1.0 must submit an auditor’s report if the advance payment to NOW exceeds EUR 100,000 or if the final determination exceeds EUR 125,000. The UWV provides an online tool for the employer to estimate whether an auditor’s report is required. If the advance amount is more than € 20,000 (and less than € 100,000), or if the final determination is more than € 25,000 (and less than € 125,000), a statement from a third-party expert is required instead of an auditor’s report. These threshold amounts are based on the subsidy allocated to the entire group and not just the compensation per entity (i.e., payroll tax number).

We are happy to assist you with questions relating to the NOW-measure or other issues you encounter due to the COVID-19 outbreak. Do not hesitate to contact one of our team members.

Norton Rose Fulbright provides interactive perspectives from multiple jurisdictions on the recent development of strategies, tools and frameworks designed to assist employers with reopening the workplace. Please find our global guide on returning to the workplace here 

Please read more about the legal implications of the COVID-19 outbreak across various industries and sectors on our website.


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