Dutch workers, bosses reject plan to halt special unemployment fund

Jun 23, 2009, 11:20 GMT

Amsterdam - Labour unions and employers' associations in the Netherlands have rejected the government's decision to stop all special unemployment payments it has made available in the wake of the economic crisis.

'The government's argument that funding for these special payments is suddenly finished, is not acceptable,' Najoua Aachboune, spokeswoman for the largest Dutch labour union FNV told the German Press Agency dpa on Tuesday.

The largest Dutch employer association VNO-NCW, meanwhile, warned that stopping the special payments would cause 'unrest' among entrepreneurs and recommended that payments should continue until January 2010.

In March, the government instituted a special unemployment payment program by which companies could seek permission to cut employees' work hours. This would allow companies to save on expenses while retaining staff.

The companies would only pay their employees for the reduced hours they had worked, while the government would pay the employment so- called 'part time unemployment money' for the remainder of their hours.

But on Monday, Social Affairs Minister Piet Hein Donner said the 375 million euros (520 million dollars) reserved for these special unemployment payments had run out much quicker than expected.

The Social Affairs Department would only consider applications received no later than June 23.

'The number of applications has risen faster than we thought,' Donner said on Dutch television.

He added many employers had applied for the special payments not because their companies lacked work, but because they wanted to save company expenses during the crisis.

But FNV spokeswoman Aachboune said the sharp increase in applications demonstrated the 'success' of the special programe that would 'save jobs'.

She disputed that the funding had run out, saying, 'this is money contributed by the employees and employers themselves, through their salaries.'

The FNV, other labour unions and employers' associations are due to discuss the matter with Donner.

Parliament is due to debate the issue next week, but the two largest government coalition parties, the Christian Democrats and Labour Party, have asked to meet with Donner beforehand.