Employers on state aid to be fined for not helping dismissed employees

Employers who receive wage cost subsidy through the NOW regulation after October 1 will be fined 5 percent of the subsidy amount they received if they do not help redundant employees find other work, Minister Wouter Koolmees of Social Affairs and Employment said in a letter to parliament, NOS reports.

This involves companies who apply for employee dismissal with benefits agency UWV for economic reasons, but do not ask the UWV to guide the dismissed employees in their search for new work. Koolmees called it a best effort obligation.

This fine and obligation came after negotiations with opposition parties on the government's third coronavirus support package. PvdA leader Lodewijk Asscher wanted a "job guarantee" for the employees of companies who receive state aid.

But the government considered this a too heavy burden on the business community, arguing that this could make employers reluctant to shed redundant employees to restructure or reorganize their company so that it can survive this crisis. A bankrupt company would leave a lot more unemployed workers, was the argument.

As a compromise, the government pledged to ensure that redundant employees of companies receiving state aid cannot simply be put out on the street. The government reserved 1.4 billion euros for this purpose.