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If you own a company in the Netherlands and one of your employees becomes ill, you are required to pay at least 70% of their last earned wages. You are obliged to do this for a maximum period of two years.
How much to pay
You should pay:
- 70% of the employee's normal wages during the first year of illness. If this amounts to less than the minimum wage, you should supplement it up to the minimum wage amount
- 70% of the employee's normal wages during the second year of illness. You do not need to supplement if the amount is less than the minimum wage
If your employee is off sick because of organ donation, pregnancy or giving birth, you need to pay 100% of their normal wages.
Whom to pay
This obligation is applicable to all your employees, such as:
- employees on a permanent contract
- employees on a fixed-term contract
- on-call employees (both those on fixed-hours and zero-hours contracts)
End of contract
If you have a disabled employee who becomes ill, you can apply for a sickness benefit at the Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen, UWV). This regulation is called the no-risk policy (no-riskpolis, in Dutch). In this case you will continue to pay your employee's salary and offset the benefit against this.
Returning to work
You must consult with the employee about their returning to work. Within the two-year period, you have the option of temporarily discontinuing payment of wages if they do not cooperate sufficiently. Insufficient cooperation can even serve as grounds for dismissal.
Work and Income (Capacity for Work) Act (WIA)
After two years, the employee may be eligible for a benefit pursuant to the Work and Income (Capacity for Work) Act (Wet werk en inkomen naar arbeidsvermogen, WIA, in Dutch). You can then dissolve the employment contract. The employee can apply for a WIA benefit after one and half years. If it is absolutely evident that your employee cannot get back to work within this period, they can, after consulting you and your company doctor, apply for a WIA benefit earlier.
UWV assesses whether you and your employee have done enough to avoid a benefits claim. If not, they may reclaim the benefit from you.
One-stop SME absenteeism insurance
The government has introduced a raft of measures to make dealing with the absenteeism of sick employees cheaper and easier for small and medium-sized businesses. Aside from exemption of the 21% tax on sick pay insurance for employers, these measures include introducing one-stop SME absenteeism insurance to support your reintegration obligations towards sick employees and changes in the role of company doctors:
- This insurance acts as a safety net to alleviate the financial risks and helps you, as an employer, meet your financial obligations and administrative requirements when an employee goes on sick leave.
- The €450-million set aside for reimbursement towards the costs of paying wages during sick leave will mainly benefit small businesses.
- The company doctor’s medical advice will play a leading role in determining whether enough is being done to reintegrate an employee. On the basis of the doctor’s recommendation, you can set up a reintegration programme with your employee. This measure is due to be introduced on 1 January 2021.
Statistics: sickness absence rate
The total number of sick days of employees, as a percentage of the total number of available (working-/calendar)days of employees in the reporting period.