Employers and unions are close to reaching a deal on reducing the length of time small firms have to pay sick pay to one year, the Telegraaf said on Wednesday.

Currently statutory sick pay lasts two years but employers say the cost is preventing small firms from taking on permanent staff. Sources told the paper that the two sides have now agreed that this can be cut to one year because this will make it easier for small firms to take on more workers.

The four parties currently negotiating a new coalition cabinet agreement all included a cut in sick pay in their manifestos.

FNV leader Han Busker and Hans de Boer of the employers organisation VNO-NCW are due to meet the four party leaders on Wednesday to discuss progress, the paper said.