NOW 3: the outlines

The extension of the Tijdelijke Noodmaatregel Overbrugging voor Werkbehoud (Temporary Emergency Bridging Measure for Sustained Employment) (NOW 3) has been announced. The Ministry has not yet published the exact text of the NOW 3 scheme, but the outlines of the scheme have already been made known.

NOW 3 will enter into force on 1 October 2020 for a period of nine months, spread over three periods, with amended conditions. The objective of the scheme will still be to support work and income, but companies and employees will also be given possibilities of adjusting to the current economic situation. But it is already clear that the scheme will be cut back slightly in each period.

NOW 3 in outline

  • The minimum loss of turnover in order to be eligible for the NOW scheme will be increased from 20% to 30% from the start of the second period.
  • The compensation percentages will be gradually reduced each period: from 80% to 70% to 60%.
  • Although the compensation will be reduced, it will be possible (unlike under NOW 1 and 2) to gradually reduce the total wage bill by 10%, 15% and 20%, respectively, without that affecting the compensation.
  • The “reorganisation fine” will be abolished.
  • The best-efforts obligation aimed at training and the ban on paying dividends and bonuses that applied under NOW 2 will continue to apply under NOW 3. Although the explanation is not yet specific on this point, it has been announced that the same system will apply. This most likely means that dividends may be distributed or bonuses may be paid only after adoption of the 2021 financial statements (usually in early 2022).
  • As under NOW 1 and NOW 2, the employer will initially receive an 80% advance.
  • The fixed surcharge for employer’s contributions will remain 40%.

List of the various conditions per period:

10% of the compensation for period 1 must be used for training/job-to-job transition. This part of the compensation will not be paid to the employer; the employer will therefore effectively receive a maximum of 80%.

NOW 3 applications

NOW 3/period 1 may be applied for as from 16 November 2020 (UWV target date) with retroactive effect from 1 October 2020. Participation in NOW 3 is not dependent on whether or not a company has previously taken part in the NOW schemes. An application for NOW 3 may also be filed per time period.

For more information on this subject please contact Bart de Vroe (+31-6-20366243) or Anna Görgün (+31-6‑23908453).

This article was published in the Newsletter Vestius of October 2020