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Employment Law in the Netherlands

Dutch law is partly codified and the Civil Code (Burgerlijk Wetboek) is the most important single source of employment law. Book 7 of the Code deals with employment contracts, including basic principles, probationary periods, fixed-term and temporary agency work contracts, and termination of contract. It also regulates related matters such as pay, annual leave, sick leave, part-time work, transfers of undertakings and sex discrimination. Outside the scope of the Civil Code, major individual statutes (often implementing EU law) deal with areas such as equality and non-discrimination, working time and rest, parenthood- and care-related leave, flexible forms of employment, health and safety, and employee representation. Case law, especially that of the Supreme Court, plays a significant role in interpreting employment-related legislation.

Pay and conditions for a large majority of Dutch employees are set by collective agreements, which are signed mainly at industry level. The Government has made many industry-level agreements binding on all employers in the sectors concerned, even those that do not belong to the signatory employers’ organisations. Collective agreements must generally comply with the provisions of employment legislation, though they are specifically allowed to deviate from statutory provisions in some areas (eg aspects of probationary periods, working time and sick pay). Where an employee is covered by a collective agreement, it usually takes precedence over the terms of their employment contract.

A works council must be set up to represent employees in all undertakings with at least 50 employees. As well as informing and consulting the works council, the employer must obtain its approval for policies and rules in many area of HR, including working hours, pay systems, recruitment, dismissals and training.

This topic refers to employment law in the private sector only.

Temporary Covid-19 Crisis Measures (as at 19 June 2020)

During the Covid-19 pandemic, the Government’s main measure to prevent crisis-related job losses has been a temporary pay compensation scheme (replacing the normal statutory subsidised short-time working arrangement). Under this scheme, the state reimburses part of the wage costs of employers that have lost at least 20% of their turnover over a three-month period during the crisis (the amount of the reimbursement depends on the fall in turnover, with a maximum of 90% of wages, up to a ceiling). Employers using the scheme must not make redundancies during the period concerned. This scheme is currently due to expire on 30 September 2020. Employers are generally obliged to pay the wages of employees who are unable to work for reasons related to Covid-19, such as being quarantined.

Employment Law in the Netherlands: Quick Facts
  • Recruitment and selection are subject to little specific statutory regulation, except for pre-employment medical examinations, but employers’ policies and practices in this area are strongly influenced by a national code of conduct Recruitment and Selection

  • The maximum permitted duration of a probationary period is two months in the case of an indefinite-term contract Recruitment and Selection

  • In general, non-EEA nationals require a combined residence and employment permit in order to be employed in the Netherlands for 90 days or more Recruitment and Selection

  • An employment contract is defined as an agreement whereby an individual (the employee) makes a commitment to perform work in the service of another party (the employer) for a period of time in exchange for payment Employment Contracts

  • In general, the same employer and employee can enter into a maximum of three successive fixed-term contracts, lasting no longer than 36 months in total Employment Contracts

  • Employees may be employed on the basis of various types of “on-call” contract whereby they work only when called on to do so, including zero-hours contracts Employment Contracts

  • The employer must provide the employee with a written and signed statement of the main employment conditions Employment Contracts

  • Employers must pay employees at least once a month, generally by bank transfer, and must provide detailed payslips and observe rules on deductions from pay. There is a statutory minimum wage Pay and Benefits

  • Employees’ maximum working time (including overtime) is generally 12 hours per day, 60 hours per week, 55 hours per week on average over any four-week period, and 48 hours per week on average over any 16-week period Working Time, Rest and Holidays

  • Employees must be granted minimum rest breaks and daily and weekly rest periods, and are entitled to four weeks of paid annual leave. They can work on Sundays only with their consent Working Time, Rest and Holidays

  • Working parents are entitled to take paid pregnancy/maternity leave (generally 16 weeks), paid paternity leave (six weeks), unpaid parental leave (up to 26 weeks) and paid adoption/fostering leave (six weeks). Employees can also benefit from other types of leave to provide care and deal with family and personal matters Parenthood and Work-life Balance

  • Discrimination in relation to employment is prohibited on grounds of religion, belief, political opinion, race, sex (including pregnancy, childbirth, maternity, sexual characteristics, gender identity and gender expression), nationality, heterosexual or homosexual orientation, civil status, age, and disability or chronic illness. Women and men must receive equal pay for the same work or work of equal value Equality and Discrimination

  • Sexual harassment and harassment on the grounds of the protected characteristics are prohibited, and employers must have in place a policy aimed at preventing discrimination and sexual harassment Equality and Discrimination

  • Most employees have their pay and conditions set by legally binding collective agreements. Employees have a right to join trade unions, and to strike, and must not be dismissed on grounds of union membership or activities or of participating in a lawful strike Industrial Relations and Collective Rights

  • A works council must be set up to represent employees in all undertakings with at least 50 employees. As well as informing and consulting the works council, the employer must obtain its approval for policies and rules in certain areas Industrial Relations and Collective Rights

  • Employers have a general duty of care and numerous detailed duties in the field of health and safety at work Occupational Health and Safety

  • In general, after any probationary period, an employer may dismiss an employee with an indefinite-term contract only if it has “reasonable grounds” or, summarily, for “urgent reasons”. Specific procedures apply to collective dismissals Termination of Employment

  • Dismissals on reasonable grounds must be approved by the public authorities or a court Termination of Employment

  • The employer must normally give notice of one to four months (depending on length of service) when terminating an indefinite-term contract and may be required to make a statutory “transition payment” to the employee Termination of Employment

  • When there is a business transfer, employees’ employment contracts are automatically transferred to the new employer Other Key Issues

  • Employers must arrange for employees the training that is necessary for them to perform their duties and to help them remain in employment Other Key Issues