Labor cost benefit per 2018

The current premium discounts will be replaced with wage cost benefits (LKV) as of 2018 in the Wage Allowances Act. In short, an LKV means that an employer receives an allowance per hour for each paid hour for designated employees. This concerns (new) employees with less good access to the labor market.

Concretely, the following target groups have been designated under certain conditions:

  • Older former unemployed employees (max. € 6000 LKV per year)
  • Work-disabled employees (newly employed or relocated, max. € 6000 LKV per year)
  • Employees from the target group of job agreements (max. € 2,000 LKV per year)

Target group register

To prove that an employee belongs to one of these target groups, the employer must have a target group statement or proof that the employee has been included in the target group register.

The target group declaration is only issued if it is requested within 3 months after the start of the employment.

Only correction messages made before 1 May of the coming year are taken into account when calculating the LKV. Subsequent revision is only arranged at the expense of the employer. If an employer leaves the LKV himself, the right will be lost.

Do not ask about illness when you start working

In this connection, it is difficult to ask an employer not to ask when the employee has an occupational disability or functional limitation, although this information is necessary to determine whether the LKV Incapacitated employee can be applied. This question can only be made on the basis of Section 63a of the Sickness Benefits Act 2 months after commencement of employment. Only then can the target group declaration for LKV Arbeidssthandicapte be set in motion. The employer therefore has only one month left for this group to put his affairs in order.

However, questions about meeting the conditions for older employees

The demand for fulfillment of conditions for older employees may be asked immediately upon commencement of employment.

Finally, employees from the target group of job agreements and employees with a Wajong benefit are included in the target group register. The employer can request this online – provided he has the BSN of the employee – via his employer portal of the UWV.

Use a script

In view of the above, an employer would have to investigate the applicability of the LKV at different times and / or run the risk of missing out on premiums due to late action. This can only be prevented by using a tight script. Such a scenario could look like this:

Time from employment Action
Right away Schedule LKV action after 2 months or decide that this is not applicable / the effort does not pay.
After 2 months (as soon as possible) – Ask the employee about possible applicability of LKVs.
– If applicable, have the employee’s power of attorney sign an application for a declaration of interest. This prevents it from remaining elsewhere. An example for a power of attorney can be found on the site of the UWV under the name “Mandate of the Mandate”.
– Check via the UWV site if the Employee is included in the target group register and if in doubt ask the UWV for confirmation.
Before expiry 3 months after employment If no response from the UWV or the municipality with regard to the target group declaration, call and questions or request has been received and if necessary send again (registered).
After receiving target group declaration / Information target register

– In the wage declaration tick check the applicability LKV.

– Target group to clear out the information for the target group register and keep it available for review for 5 years.

Before 1 May of the next calendar year Check whether the data related to LKV are correct and adjust if necessary.