The outgoing cabinet announced that the NOW (Temporary Emergency Bridging Measure for Sustained Employment) will be extended to include Q3 2021. Therefore, as an employer, you can receive wage cost subsidy in Q3 as well. NOW will be extended in its present form; it will not be reduced. To be eligible for the fourth version of NOW (NOW 4), your loss of turnover must have been at least 20%. The maximum subsidy percentage remains 85%. But the reference month for the payroll costs has been adjusted from June 2020 to February 2021. The extension is expected to cost f € 2 billion. NOW 4 will apply from July 1 to September 30, 2021.
To reimburse employers, the TVL (Reimbursement Fixed Costs) is retroactively no longer included in the turnover for NOW as of NOW 3, which applies from October 2020 to June 2021. The previous increases in the TVL meant higher turnover for employers, which meant they received less subsidy. By excluding the TVL, you will receive a higher amount of support as of NOW 3 when you have applied for the definitive subsidy.
Processing the altered calculation method will involve additional work, so the wage subsidies will not be paid until July at the earliest. As it is unclear to what extent the economy will rebound in the immediate future, a three-month extension has been opted for. After the summer, the government will decide on the continuation of the NOW, depending on the extent to which society will be further unlocked.
The NOW is part of the outgoing cabinet’s corona policy. The compensation for employers who suffered a loss of turnover of at least 20% over a three-month period due to the corona crisis, aims to mitigate the impact of corona on employment.