Never before has the labor market been so tight, but many people are still on the sidelines. According to employers and experts, this cannot be seen separately from the long period in which companies continue to have to pay their sick employees.
The financial risk of hiring people is therefore sometimes too high, they say. It is especially difficult for the elderly and people with a disability to find a job.
Double labor costs
A sick employee will continue to have at least 70 percent pay for a period of two years. “Sometimes people need a little more time to recover,” said Kitty Jong, vice president of the FNV union. “Think, for example, of cancer, but also now with lung covid. You don’t want people to become disabled very quickly.”
Such a long-term sick employee can cost the employer a lot of money. In addition to the continued payment, there must be a temporary replacement – and that means double labor costs.
It is expensive, especially for smaller businesses. Companies can insure against it, but not everyone does it because of the premium cost. Despite the fact that the previous government set aside millions to partially pay this premium, almost a quarter of employers do not have such insurance.
Creative entrepreneurs no longer dare to hire people, they become self-employed.
But according to labor market professor Ton Wilthagen, the Netherlands not only has a staff shortage, but also an “inclusion deficit”. “This means that many people are outside the labor market who want and can work. But they are seen as a risk, because if they become ill, the salary must be paid for up to two years.”
“The average labor force participation in the Netherlands is high. But the difference is very large among people with a disability or the elderly. In Scandinavia and Germany, 35 percent more people work in that group than in the Netherlands.”
Henk Grifhorst owns a children’s clothing store in Amsterdam and has for years fought against the rules for continued payment of wages. “I once had an employee get a tattoo in a place where the sun doesn’t shine,” he says. “He got sick for a long time, and I’m responsible for that. While the insurance company says: it’s reckless behavior. It does not pay off. Why should entrepreneurs do it?”
Kristel Groenenboom, owner of a container company, also sees the rules as a big burden. “Building containers is physically demanding work. We have an absence of 8 to 10 percent. And long-term illness costs a lot of money. If someone is out for two years, it can cost between 150,000 and 200,000 euros.”
I’m not going to block the highway with containers, but I find that frustrating.
The law regulating long-term pay in the event of illness was passed in 2004. The Netherlands is world champions with continued pay payments for 104 weeks; in Germany it is six weeks, in Belgium 30 days. Thereafter, sick workers in these countries receive compensation from a collective benefit.
‘Let society pay’
Store owner Grifhorst is now working with CDA on a bill to regulate that small entrepreneurs are no longer responsible for the salaries of employees who have become ill due to ruthlessness. “Creative entrepreneurs no longer dare to hire people, they become self-employed. Small and medium-sized businesses are already going through a difficult period, it only makes things worse.”
Professor Wilthagen wants the period for all employees on sick leave to be shorter. “Society must then step in to ensure that everyone can return to work.”
Get long sick leave
They do not agree with the trade union FNV. Vice President Jong: “As an employer, you should present yourself as someone who likes to invest in your employees who are committed to recovering time for a sick employee. Look at how many people are coming to you.”
Jong points out that only 1.5 percent of all sick leave lasts longer than four months. In addition, she stresses, employers can claim subsidies to employ people with disabilities.
But for entrepreneur Groenenboom, the financial barrier is still too great. “It’s very sad,” says Groenenboom. “I do not intend to block the motorway with containers, but I find it frustrating.”