Dutch labour law and your contract of employment
Dutch labour laws regarding your contract of employment in the Netherlands are numerous; here are some expert tips on negotiating your employment contract.
The laws covering employment in the Netherlands are many and various. Your personal contract of employment will determine your pay and specific conditions. Dutch employment law covers key areas such as trial periods, Netherlands vacation, notice and dismissal, the Dutch minimum wage, health and safety and equal treatment.
The Dutch labour law system for dismissal is particularly unusual in being so protective of employees: in most cases the employer needs permission from the UWV WERKbedrijf or the court to fire you.
Useful information regarding working practices, your contract of employment, Dutch labour law and the Netherlands' minimum wage can be found on the Ministry of Social Affairs and Employment website (www.szw.nl) or the UWV WERKbedrijf website (www.werk.nl).
If you want to assess an employment contract offer, you can check the market rate for your salary or calculate bruto/netto rates (before/after tax and social security deductions) at www.loonwijzer.nl. It is standard practice in the Netherlands to get extra wages (usually 8 percent of your yearly salary) as a ‘holiday allowance’ (normally paid in May) plus four weeks of paid leave. Read about Netherlands vacation days.
There are numerous aspects to Dutch labour law, however, which are explained below to help you negotiate your contract of employment in the Netherlands.
Dutch labour law overview
Sanne van Ruitenbeek of Pallas Advocaten provides the following important information about the Dutch employment law:
- If you work in the Netherlands, Dutch labour law is partly and often fully applicable to your employment, even if the law of another country is declared applicable in your contract of employment.
- The number of succeeding employment contracts for a fixed term is limited to three, but can also not exceed a limit of two years for total duration of fixed term contracts. If the duration of the contracts or the number of fixed contracts exceeds either legal limit, the contract of employment will automatically become a permanent contract for an unlimited term. An interval of six months between contracts, however, breaks the chain of consecutive temporary contracts.
- If the contract is for less than two years, the trial period cannot be longer than one month. The maximum duration of a trial period is two months. Trial periods in an employment contract for less than six months are invalid. During the trial period, both employer and employee are allowed to terminate the employment contract with immediate effect.
- The notice period for the employee is usually one month. If the notice period for the employee to end a contract of employment is extended, the notice period for the employer should be double the notice period of the employee.
- A permanent contract can only be terminated by the employer with consent of the employee, the labour office (UWV WERKbedrijf) or the Court. The court and labour offices assess whether there are grounds for a valid termination. If an employer gives notice of termination without obtaining prior approval, the employee could nullify the termination. This rule is not applicable in the case of summary dismissal (such as fraud or theft by the employee). Courts are, however, very reluctant about accepting summary dismissals under Dutch labour law. It is therefore very important to contact an employment lawyer immediately if you are fired on the spot.
- According to Dutch employment law, the legal minimum number of holidays per year is four times the weekly working time. This means 20 holidays in the case of fulltime employees working five-day weeks, although it is common practice for fulltime employees to be granted 25 holiday days per year, on top of Dutch public holidays. As per the Dutch labour law, there is an expiration date of six months for taking the legal minimum number of holidays. Employees therefore must take all their holidays within six months after the year in which the holidays were accrued. Should the employee not take the holidays on time, the holidays will lapse without any compensation or payment. The expiration date of six months is not applicable to the holidays that the employee is entitled to on top of the legal minimum number of holidays. These extra holidays will not lapse until after a period of five years. Read about Netherlands vacation law.
Labour standards NL: Collective Labour Agreements (CAOs)
This is a written agreement covering working conditions and benefits, which is drawn up by employers, employers’ organisations and employee organisations (such as unions). A CAO operates at company or industry sector level and the provisions (number of holidays, for example) are often more generous than statutory requirements. It should state in your contract of employment whether a CAO is applicable; you don’t have to be a member of a union to benefit. If no CAO applies – all must be registered – you will need to negotiate your own terms and conditions. The largest trade union federation in the Netherlands is the FNV (www.fnv.nl).
Changing jobs: Your employment contract and Dutch permit
Any changes in your work or partnership status must be reported to the IND within four weeks. You or your ‘sponsor’ (such as an employer) can be penalised by the IND if changes aren’t reported, including contributions to repatriation costs.
If you change jobs, you don’t necessarily need a new residence permit, but the same rules will apply as for the first permit you were granted. So if you worked with a separate work permit, your new employer needs a new work permit, too, for your contract of employment.
If you worked as a highly skilled migrant, your new employer needs to be eligible to apply under the highly skilled migrant scheme, and will need to prove to the IND that you still meet the requirements of the highly skilled migrant scheme, for example, sending in your contract of employment to show you earn the required salary.
If you are applying to extend a residence or work permit, your circumstances will be assessed again in reference to the original application. The main exception is that after three years working on any given residence permit that allowed you to work (such as a partner's permit or employee single permit), you no longer need a separate work permit to sign an contract of employment.
Highly skilled migrants can also change their purpose of stay into ‘labour’ after three years, which allows them to work without a work permit and without meeting the requirements for the highly skilled migrant scheme either.
Unemployment benefits (WW) Netherlands
Typically all working residents in the Netherlands must first pay Dutch social security contributions in order to receive any benefits. Your employment history determines the amount and duration of unemployment benefit payments. For the first two months you get 75 percent of your last earned salary, and thereafter 70 percent. You must have worked 26 out of the previous 36 weeks before the first day of terminating your contract of employment (or less for those not in regular employment), although benefits can be restricted if other benefits are in operation. Read more in our guide to Dutch social security.
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Sanne van Ruitenbeek, Pallas Attorneys-at-law / Expatica
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