Target group reduction first recruitments: reform measure on the way?
June 2023 – With a target group reduction for first hires, the federal government supports you as an entrepreneur in bringing your first employees on board. In this article, we briefly refresh the basics of this measure. And how does the government intend to reform this measure from 2024?
Target group reduction is a financial benefit that encourages employers to recruit and retain employees from certain target groups. Specifically, it covers the recruitment of young people (under 25), older people (from 58), people with disabilities, mentors and long-term jobseekers.
Do you have plans to hire your first employee? As a private sector employer, you will enjoy an exemption from NSSO employer social security contributions of EUR 4,000 for your first employee, with no time limit. For the next five employees, you will enjoy a reduction from €1,550 to €450, limited to a maximum of 13 quarters. This measure also provides for an intervention in the costs of a (recognised) social secretariat.
Conditions to enjoy target group reduction as an employer
When does the law consider you a new employer? If you have not employed an employee for 12 months prior to hiring. You are not eligible if your employer is part of a simultaneous Technical Business Unit (TBE) or historical TBE.
Keep in mind that since 1 January 2022, casual employees in the hospitality industry and flexi-jobbers are no longer entitled to a target group reduction. So these employees are no longer taken into account to determine whether you already employed staff or not.
What financial support is applicable?
Target group reduction entitles you to a reduction in NSSO employer contributions. You are free to choose which employee you use the reduction for. In other words, you can first check for which of your employees a different target group reduction is more interesting and decide per quarter whether and for whom you will apply for the target group reduction for first-time recruits.
Specifically, this involves the following amounts and deadlines:
Quarterly For the entire employment period
1st employee € 4,000
Quarter 1 to 5 6 to 9 10 to 13
2nd employee € 1,550 € 1,050 € 450
3rd employee € 1,050 € 1,050 € 450
4th employee € 1,050 € 1,050 € 450
5th employee € 1,050 € 1,050 € 450
6th employee € 1,050 € 1,050 € 450
An intervention in your administration costs is also possible. Are you a new employer joining a recognised social secretariat? Then you are entitled to an intervention in administrative costs worth € 36.45 for the quarters that you apply for a target group reduction for a first employee.
The amount of the intervention is a quarterly amount. Every quarter that you enjoy the benefit for a first hire, you can enjoy this intervention.
Reform measures imminent?
The federal government has plans to limit this target group reduction for the first employee to a maximum of €3,100 (instead of €4,000) per quarter from 1 January 2024. In addition, the reduction for the fourth to sixth employees would be abolished. This information is still subject to change. We will keep you updated as soon as more info on this is known.
