Wet structuur uitvoering wet en inkomen (SUWI); Werkloosheidswet
Act on the structure of implementation of work and income (SUWI act); Law on unemployment
Public employment service
The act on the structure of implementation of work and income is the umbrella legislation on employees' benefits and reintegration. Chapter 5 deals with the tasks of the public employment service (UWV). According to article 30a, the task of the UWV is to stimulate labour market participation of the unemployed, employees with disabilities, and employees who are threatened with unemployment in the foreseeable future (four months). This should be done by registering people with the service and flagging vacancies to them. UWV can work together with clients to develop a reintegration plan if circumstances are deemed by UWV to justify this, with regular monitoring of the progress. The service is based on a personalised, targeted approach for those who need it, where the job market position of the unemployed is the main factor in the analysis of opportunities to get a job. UWV determines the labour market position using the Work Explorer (an online questionnaire). The Work Explorer predicts the probability of job resumption within one year after the onset of unemployment. On the basis of the outcome, jobseekers receive tailored services. People receiving an unemployment benefit and having less than 50% of job recruitment opportunity within one year are invited to a personal job orientation interview. The content of the reintegration plan depends on the specific situation and circumstances, and usually consists of training programmes and forms of coaching. These tasks of UWV apply to all unemployed or disabled employees, with some exceptions. In case of major restructuring, UWV and other parties concerned (local or regional authorities, unions, employer federations) may establish a special task force. However, there is no specific legislation for this purpose.
People that have been employed for at least 26 weeks in the last 36 weeks that become (partially) unemployed through no fault of their own, loose at least five hours of work, are directly available for another job, and have registered as jobseekers at the public employment service, are entitled to an unemployment benefit that equals 75% of their previous income for the first two months and 70% for at least three months. The height of the benefit has an absolute cap that is determined separately for each year, in 2019 this amounts to €214 per day, or €4,660 per month, which could mean that high-wage workers may experience a lower replacement rate.
The duration of the benefit is in a period of change between 2016 and 2019. It is calculated using a so-called working life indicator, using actual and fictional work history. The actual work history is constituted by the years which the employees worked, from 1998 to the year in which they became unemployed. A year must meet the following conditions in order to count:
- Until 1 January 2013, a year counted as a 'working year' if one received a salary for at least 52 days in that year. The year in which the benefit began does not count.
- From 1 January 2013, a calendar year counts if one received a salary for 208 or more hours in that year.
If one year does not meet these conditions, that year may sometimes count (in part) if one took care of a child younger than 5 years (care plan) or of someone who is ill or disabled (mantelzorgforfait); was on unpaid leave; received a full disability benefit; or worked in other countries.
The fictional 'working life' consists of the years from one's 18th birthday up to 1997 (relevant only for people 18 or older in 1997). It does not matter if one worked or did not work during that period.
The sum of the actual and fictional 'working life' is the total 'working life'. This determines the duration of the benefit:
- 10 years or less: for each year one is entitled to 1 month
- Over 10 years: For all full calendar years of employment before 1 January 2016 one is entitled to 1 month. For all 'working life' years from 1 January 2016 one is entitled to 0.5 month of Unemployment benefit (WW uitkering).
The maximum benefit payable has been lowered from 38 months as of January 2016 to 24 months in 2019. For the duration of the benefit, unemployed people are obliged to cooperate with the public employment service to help their own reintegration into the labour force. This obligation entails applying for jobs at least four times a month and accepting suitable work. Almost all work is deemed suitable by the public employment service if a person has received unemployment benefit for six months or more, so job offers for employment with long travel time or significantly lower pay also have to be accepted.
Unemployment benefits also apply if a person earns less than 87.5% of the amount that they previously earned, through no fault of their own (partial unemployment). In this case, the benefit supplements up to 87.5% of previously earned income.
The unemployment benefits are paid from a fund to which all employers contribute (obligated premiums).
At the end of 2018, the UWV public employment service listed 263,000 people who were wholly or partially on unemployment benefits. This number is expected to decrease by 31,000 in 2019 and then rise again by 2,000 in 2020.
Cost covered by
- National government
Involved actors other than national government
- Public employment service