In a lending construction, who is actually entitled to the NOW subsidy? And should lenders and borrowers share this subsidy, or is only one of these parties entitled to it? The interim relief judge gave the first (tentative) answer to these questions on 30 July 2020.
A temporary employment agency (hereinafter "lender") employed temporary workers at a wholesaler (hereinafter "hirer") through a third party. In practice, the lender functioned only as a back-office party; the lender paid wages to the temporary workers and charged these wages with a mark-up to the hirer.
The hirer informed the lender in March 2020 that it would lose turnover, that it did not want to lose the temporary workers and that it therefore wanted to discuss using the NOW scheme. The lender did not respond to these requests. However, in April 2020, the hirer did issue a formal notice of default to the hirer for a number of unpaid invoices relating to labour costs.
The lender additionally made the proposal that 80% of these invoices should be paid immediately by the hirer, and the remaining 20% could be paid at a later stage. In that case, the lender promised to pay to the hirer the part of the NOW subsidy it would receive for the staff hired by the hirer.
The hirer did not agree to this proposal and indicated that it would hire the temporary workers through another back-office party. Here, the arrangement would be that the hirer had to pay 20% of the labour costs to the lender, and the lender would bear the remaining 80% of the labour costs.
The lender then took the matter to court. It requested that the interim relief judge order the hirer to pay the outstanding invoices. The question the interim relief judge had to answer was whether the hirer still had to pay the full wage costs to the lender, now that the lender had been awarded a NOW grant.
The interim relief judge did not consider it reasonable that the hirer had to pay 100% of the wage costs to the lender now that the lender had been awarded a NOW subsidy. According to the court, this would not be in line with the government's intentions in introducing the NOW scheme, namely to preserve jobs.
Practice shows that in the temporary employment sector, mutual agreements are made in this regard and, in this way, the NOW subsidy benefits the party who actually keeps the temporary workers at work. In this case, that would be the hirer.
Therefore, that the hirer is obliged to pay the full invoice amount to the lender is not beyond doubt. In addition, the hirer had not made the existence of an urgent interest in its claim sufficiently plausible either. According to the court, it was therefore impossible to see that proceedings on the merits could not be awaited. The claim for injunctive relief was therefore dismissed.
In this ruling(ECLI:NL:RBGEL:2020:4079), the court makes it partly clear that the purpose and purport of the NOW scheme is to accommodate those who actually keep employees in work. This is not consistent with the fact that an employment agency that receives an allowance under the NOW scheme does not pass on this allowance in its invoices to the hirer.
Then contact our specialists from the Right about NOW team.