After Lunch Webinar: Max Groneck – “The Dutch Disability Insurance System and its recent Reforms”

A unique feature of the Disability Insurance (DI) and sick leave system in the Netherlands is its extensive degree of employer responsibility by making employers accountable for their sick listed and disabled workers. This paper studies whether sharing the costs of the DI benefits of their workers yields firms to provide more work accommodation efforts for non-permanent employees. Our analysis exploits a reform in the Netherlands that extended employer incentives within the sick leave and disability insurance system to non-permanent employees using unique Dutch survey data. We find that shifting the costs of sick leave and disability towards the firm has no significant impact on accommodation efforts. We do find evidence that the reform led to more firms opting for self-arranging both the sick leave benefits and the reintegration process of sick non-permanent workers, instead of using the public insurance scheme. For the firms that opted out of the public system, we find higher accommodation rates.