Changes from January 1st 2017 in the Netherlands

by Alexander Beard, on Jul 28, 2016 1:41:02 PM

Due to the Wet Beperking Ziekteverzuim (Law Limitation Absence Through Illness) and Arbeidsongeschiktheid Vangnetters (Disability Safety Nets), or BeZaVa.

Employers pay annual premiums to the Tax Authorities for permanent and temporary employees for the cost of long term disabled employees. The differentiated Whk (employment continuation funds) premium. The reintegration assistance is done by the UWV, as well as the long term benefit payments.

An employer can choose to pay the long term disability benefits themselves for permanent employees. Or become responsible for the reintegration requirements themselves too. In that case no premiums need to be paid to the UWV. This is called being Self-insured.

With effect from 1st January 2017 the premiums for permanent and temporary employees are being combined to one premium. Because of this employers who are Self-insured need to make a choice if they want to add the premium for temporary employees to their Self-insurance or stop Self-insurance and return to the UWV.

History

On January 1, 2013, the Wet Beperking Ziekteverzuim (Law Limitation Absence through Illness) and Arbeidsongeschiktheid Vangnetters (Disability Safety Nets), or BeZaVa, was implemented, more currently known as the Modernizing Health Legislation. The law aims to limit the absence through illness and the influx of employees with a flexible contract, ‘flex workers’, in the WIA (work and income according to labor capacity act).

In order to achieve this, the financial involvement of employers increased, among other changes. As of January 1, 2014, employers contribute to the health expenses of flex workers via a differentiated premium.

Choices to be made before 01-10-2016

On 1 September 2016 the UWV will publish the differentiated Whk (employment continuation funds) premium for 2017. Employers who are currently Self-Insured need to determine if they want to remain Self-insured after 1 October 2016. This can be a difficult decision, however we are happy to assist you in making the right choice for your business.

Possible advantages and disadvantage between UWV and Self-insurance

 

Possible advantages Possible Disadvantages
UWV After 104 weeks employer is no longer directly responsible for reintegration. UWV is faced with a big delay with the medical inspections.
Premium small companies linked to industry wide disability figures, and does not increase if the employers is faced with high disability numbers. The employer has no influence on reintegration costs, but pays for the disability through the premiums.
ERD Self-insured employer can influence reintegration and save costs. Insurance premium can become higher at increasing disability rates.
If the Self-insured employer has reinsured this risk with an insurance company, insurance companies are better equipped and have a higher interest in getting the employee back to work than the UWV. Higher administrative burden for the employer.
Topics:AnnouncementsEmployeesEuropeNetherlands