Changes to Dutch employment law some things to watch out for

Changes to Dutch employment law: some things to watch out for

Dutch employment law is constantly changing. 2024 is no different with several interesting pieces of legislation are in the pipeline. Seliz Demirci from GMW Lawyers has the lowdown on the changes to Dutch employment law.

Given the caretaker status of the government it is unclear if this draft legislation will become law. And if so, when it will come into effect. Nevertheless, these are the changes to employment legislation you may be faced with in 2024 and 2025.

1 Changing rules to prevent sham self-employment.

In March 2023, the Supreme Court ruled that delivery drivers working for Deliveroo should not be regarded as self-employed workers, but as employees. This means they are entitled to the protection and benefits enjoyed by employees. Such as minimum wage, holiday pay, sick pay and protection against dismissal.

This piece of legislation aims to combat this type of sham self-employment by, among other things, bringing in a presumption that there is an employment contract, with employees earning below € 32.24 an hour.

The legislation is due to come into effect on the first of July 2025, but may be amended before then. The potential practical implications are significant for both employers and freelancers, from employment law and tax point of view.

2 Changes to the sick leave system in the second year of illness

This proposal is aimed at small and medium-sized businesses. Under the current rules, when an employee becomes ill, the employer is required to continue paying at least 70% of the salary for 104 weeks.

During this period, the employer is expected to do what is possible to reintegrate the employee into suitable work. The focus here is on having the employee return to his own job with the same employer. This is called the first track.

In addition, the employer (usually from the second year of illness) can also explore  reintegration with another employer. This is called the second track. Both tracks should run in parallel.

The proposed new law gives small and medium-sized businesses the right to focus exclusively on the second track. I.e. external instead of internal reintegration from the start of the second year of illness. The employee must agree to this.

If this law is passed, employers will no longer have to keep the employee’s position open from the second year of illness. And their position may be filled by someone else. That being said, the employer must continue to pay wages until the 104th week of illness. They also have to continue to make efforts to reintegrate the employee with another employer.

3 Better job security for flexible workers

The current law allows employers to offer workers call-out or zero hours contracts. The employee only works the hours they are called in to cover and does not get paid if they are not called to work. The government aims to strengthen the position of on-call and temporary agency workers by abolishing zero hours contracts.

Rules covering multiple short term contracts are also being amended. At the moment, the employee should be given a permanent contract after three years or after three consecutive temporary contracts with the same employer. If this does not happen, the employer can wait six months and then hire the same person again on a temporary contract.

If the legislation is passed, the six-month interval will be increased to five years, making it more difficult for employers to repeatedly hire an employee on a temporary basis.

4 Mandating a confidential advisor for staff

In 2023, parliament passed a bill requiring employers to appoint a confidential counsellor as part of efforts to reduce bullying and other undesirable behaviour in the workplace. This shouls help create a safe working environment for all employees. This legislation regulates the basic tasks involved and strengthens the legal status of the confidential counsellor in the private sector and other organisations.

Small companies with fewer than 10 employees are exempt from the requirement for the time being.

5 Amending the non-competition clause

Under current law, employers are legally allowed to impose a non-compete clause with a broad scope. The government wants to tighten and reform the legislation relating to non-competition clauses to make it easier for employees to move on in the labour market.

Among other things, the non-competition clause will be legally limited in duration and geographical scope. Employers must also justify the compelling business interest underlying a non-competition clause in permanent employment contracts, and departing employees must also be paid compensation if they comply with the non-competition clause.

These plans are currently being developed into a bill and will be submitted for consultation before being sent to the lower house of parliament. As yet it is unclear when the new law will come into effect.

More information

Should you encounter any problems with your employment contract, redundancy and a competition clause, feel free to contact us. We will be happy to assist you.