Economy

Also ‘old’ NOW scheme adjusted: still a solution for seasonal companies

Companies that are losing more than 20 percent of their turnover due to the crisis can rely on the NOW. The state will then reimburse up to a maximum of 90 percent of the wage costs, depending on the size of the loss of turnover.

Don’t work for seasonal businesses

The scheme does not work well for seasonal companies. Because January is the reference month for the amount of the wage bill for which they can receive a subsidy. This makes no sense for beach bars, for example, because they hardly employ anyone in January. While in the months of March, April and May, for which they apply for subsidy, they have much more staff.

In other words, the seasonal companies can hardly receive any government support from the government to keep their employees employed, because they started working too late.

March instead of January

These companies can now apply for a subsidy with retroactive effect. If the wages bill in the months of March up to and including May exceeds three times the wages bill for January, the wages bill for March will be used to determine the subsidy amount.

Companies that have already applied for NOW under the old rules, but that do have a higher wage bill in the months of March through May, will automatically benefit from the change. Non-seasonal companies whose average wages in March-April-May were higher than in January will also benefit.

Good news for buyers

Something important has also changed for companies that have taken over in the course of 2019 or the first two months of this year. Indeed, they ran into another problem: determining the drop in turnover.

The drop in turnover is calculated by taking 25 percent of the turnover in 2019 and comparing it with the expected turnover for the months of March, April and May, or a period of three months that starts in one of these three months.

Distorted picture

Companies that have made an acquisition will be disappointed, because their average turnover per three months in that calculation is much lower than the turnover since the acquisition. As a result, the drop in turnover also appears to be smaller, so they receive too little subsidy.

That has now been adjusted. To determine the pre-crisis turnover, we will now look at the turnover since the takeover, and that amount will be converted into a three-month period.

Companies that only took over after January had another problem. Namely that, as with the seasonal companies, the January wage bill distorted. After all, they had recruited more staff after that time. However, because the seasonal company scheme applies to every company, this problem has also been solved.

Thirteenth month

Another problem that arose after the scheme was already invented: many companies give their employees a thirteenth month in January, the reference month for the wages bill. As a result, their salary in January was not representative, because it was far too high.

Not a disaster, but it led to an excessive subsidy, which the company would have to pay back later. The thirteenth month is now filtered out of the wage bill.

Request longer

Because the changes in the scheme mean that some companies are now eligible for the scheme, and other companies may now want to use the NOW, the subsidy for the first three months can also be applied for a little longer: up to June 5. That date was until May 31.

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