Substitute fulfilment

What it means

Substitute fulfilment is a way for an employer to meet the disability employment quota without hiring people with disabilities itself. It orders goods or services from a sheltered workshop, a sheltered workplace or a self-employed person with a disability.

The law sets how much work ordered corresponds to one missing employee with a disability. The order must be genuine, paid for and carried out by people with disabilities, not simply re-invoiced through a workshop from another supplier.

Substitute fulfilment is an alternative to paying the levy for missing the quota. It can be better value for a company, which gets goods or services it needs anyway while supporting the employment of people with disabilities.

How it works in practice

To meet the obligation, the employer collects invoices and confirmations from sheltered workshops or self-employed people with disabilities for the calendar year and files the annual notice on meeting the quota with the labour office by the statutory deadline.

When choosing a supplier, check that it has sheltered workshop status or is a person with a disability trading under a licence, and that it actually did the work. Typical orders are cleaning, packing, printing, catering or small-scale production.

The costs are an ordinary deductible expense according to what was supplied. In the books we recommend flagging substitute fulfilment invoices so that they are easy to total at year end for the notice.

What to watch out for

The most common mistake is ordering “substitute fulfilment” from an intermediary who simply re-invoices goods from an ordinary supplier. The labour office will not accept it, and the company has to pay the levy for missing the quota.

The second risk is missing the notice deadline or miscounting employees. The quota is calculated from the average headcount, and a calculation error can lead to back payments and a fine.