Overview of employment law in the Netherlands

Employment law is a branch of law that deals with the rights and obligations of the employer and the employee in the context of employment. The rights of the employer mainly relate to the right to instruct the employees. The employees are then obliged to comply, but they also have rights that have been created to protect workers.

In addition to the legal rules that apply to employment law, freedom of contract also plays a role. Employment law is a complex subject in which the judiciary has also created or tightened up a number of rights. This page discusses the basics of Dutch employment law.

Table of contents

Employment law and hours worked

woman checking her worked hours The number of hours a person works must be within a range that is not dangerous. There is also an expectation that the employees are available to work a set number of hours to ensure the business is running effectively. There are many situations in which the interests of the employer and employee will come into conflict.

Holiday hours upon termination of the contract

At the end of a contract of employment, the employee will want to take all or part of their accrued holiday days within the notice period, and before they start a new job. This might not always be possible, the employee must still request the holiday dates as standard and this can be refused.If refused and the holiday days not taken before the end of the contract, the employee must pay them.

Special rules for a zero hours contract

In a zero-hour contract, an employee has an employment contract to work zero hours. This is advantageous to the employer, who can implore the employee to work long and unsociable hours. There are a number of restrictions to help support the worker:

An employer can call the employee to work a short period, but is obliged to pay for at least three hours of work, even if the work takes only half an hour.
The employer is obliged to call the employee at least four days in advance.
Within this four day period, if the employer calls the employee to cancel they must still pay the wages.
There is also an obligation to continue paying wages in the event of illness. The employee may call in sick and the employer must then pay at least 70% of the wages for the days that fall in the on-call period,and the wages cannot fall below minimum wage.
On-call workers are entitled to paid holiday hours (four times the number of agreed working hours per week).
A zero-hours contract is only possible to a limited extent. After twelve months of employment, the employee is entitled to security. That is why the employer must offer the on-call worker a contract for the average number of hours worked in the past year.
When an on-call worker works every week or at least 20 hours per month for three months, they can enforce an employment contract through the courts for the average number of hours in this period.

Employer wants to reduce hours

It is of course possible that the employer has less work than expected. This is a difficult decision because simply reducing performance hours can mean that an employee can no longer pay their bills. The employer cannot just unilaterally reduce the number of hours available, but the employer and employee can freely make agreements about this.

Right to work and the agency clause

Many employers choose to work through an employment agency, allowing them to deal with staff in a flexible way, as the contract of employment is with the agency and not the individual. The contract with the temporary employment agency often contains a temporary employment clause that allows for the end of working hours within 26 weeks if there is no work available. After 26 weeks of work, the agency clause no longer applies. In that case, there is simply a safety net and the employee will not lose their job.

Employment contract

In principle, freedom of contract applies in the Netherlands. In this way, the employer and the employee can freely make agreements. In practice, however, employment contracts are strictly regulated with a view to the protection of the employee.

Whatever the agreements are, the employer cannot simply dismiss employees without warning. That is why the termination of the employment contract is very strictly regulated, in various ways.

Contract with probationary period

Employers sometimes include a probationary period clause in the employment contract to check if the employee fits with the range of duties and company culture. If the employer wants to terminate the contract they do not have to reassign the employee and a preventive test by the subdistrict court or the UWV is also not mandatory. Such a probationary period is allowed, but is subject to all kinds of restrictions:

To be valid, a probationary period clause must be drawn up in writing
A probationary period may never exceed two months. In the case of an employment contract for a period of less than two years, the probationary period may not exceed one month
In successive employment contracts, a probationary period clause is only permitted in the first employment contract, unless the new employment contract relates to a position with clearly different skills or responsibilities
The employee can also resign during the probationary period, whereby the probationary period is the same for the employer and the employee
Even with a probationary period clause, the employer may not terminate the employment contract for discriminatory reasons

Please note that a collective labour agreement can always deviate from the above restrictions.

employer and employee going over the contract

Competition clause and non-solicitation clause

A non-competition clause and non-solicitation clause are clauses that can be included in an employment contract to prevent employees from joining competing companies after termination of employment. A non-competition clause restricts an employee's ability to join a competitor after termination of employment, while a non-solicitation clause prohibits the employee from contacting customers, suppliers or other associates of the former employer after employment.

Certain conditions apply to the validity of a non-competition or relationship clause:

The clause must be agreed in writing between the employer and the employee (a verbal agreement is not enough).
The employer must clearly explain why the clause is necessary, for example to protect specific business interests.
The employee must be able to understand the consequences of the clause and must be of age when signing the employment contract.
In some cases, a court may rule that a non-competition or non-solicitation clause no longer applies, for example if an employer has acted seriously culpably. This means that the employee is then no longer bound by the restrictions entailed by the stipulation.

Employee wants to terminate the employment contract

The employee can always terminate the employment contract if it concerns an employment contract for an indefinite period. In the case of a fixed-term contract, this is only possible if a termination clause is included in the employment contract. Otherwise, the specified period must be completed.

Of course, the parties are free to make a number of agreements themselves and to terminate the employment contract in mutual consultation and consent. In that case, of course, a number of matters must be arranged, for example if the employee prefers to see the non-competition clause scrapped. Such agreements are included in a settlement agreement. It is important to be assisted by a lawyer.

employee and employer terminating the employment contract

Employer wants to terminate the employment contract

If no probationary period clause has been included or if the probationary period has ended, it is much more difficult to terminate the employment contract. Here, the legislator makes a clear choice to protect the employee. In most cases, the employer must submit a request to the UWV or the sub district court. Except in exceptional situations, such as dismissal for urgent reasons.

There are various grounds for dismissal and they are all strictly regulated:

Dismissal for business economic reasons
Because the employee is long-term incapacitated for work (after the first two years)
The employee is regularly ill and this has unacceptable consequences for business operations
The employee performs insufficiently or is unsuitable for work, while the employee has been given sufficient opportunities to improve his performance
The employee behaves inappropriately (e.g., forges credentials, steals, shows up to work drunk, etc.)
The employee has serious conscientious objections to the work and the work cannot be performed in an adapted form
There is a disturbed employment relationship that cannot be repaired
Or a combination of different reasons for dismissal
The employee has reached retirement age (but a collective agreement may impose a higher age)

In addition to the above reasons, there is also a residual group of “other reasons” provided by law. This residual group is not there to give the employer the freedom to dismiss an employee smoothly. This residual group is therefore interpreted strictly by the judges. It does allow the employer to dismiss an employee who, for example, has to serve a long prison sentence and can no longer come to work.

On the other hand, there are all kinds of protective grounds or situations in which there is a ban on dismissal. However, these exceptions are not so absolute that a thieving employee cannot be fired.

There is a prohibition on dismissal when:

The employee has been incapacitated for work or ill for less than two years
The employer has made insufficient efforts to reintegrate the employee during the two years of illness
The employee is pregnant or on maternity leave
This concerns the first six weeks of maternity leave
This concerns the first six weeks after an incapacity for work caused by pregnancy or childbirth
The employee is a member of the works council, a standing committee of the works council or the employee representative body
The employee must fulfil their national service in their country of origin
The employer relies on discriminatory grounds (e.g. ethnicity or gender)
The employer relies on the fact that the employee wants to take parental leave
The employer relies on union membership
The employer relies on membership of a political organisation
The intention to dismiss follows from the takeover of the company
The intention to dismiss is the result of a refusal to work on Sunday

An instant dismissal

An employer should not treat an instant dismissal too lightly. After all, this is a drastic sanction with far-reaching consequences. Therefore, the summary dismissal must meet a number of conditions:

The summary dismissal must be motivated by an urgent reason
The instant dismissal must be given immediately
The instant dismissal must be communicated immediately

The first condition is interpreted very strictly by case law, making instant dismissal manifestly unreasonable. For example, the proportionality between the dismissal and the reason underlying it is also taken into account. However, it can of course also be challenged on the basis of the other two conditions. If a court decides that the dismissal is manifestly unreasonable, it can annul the dismissal and reinstate the employment contract. They will often judge that a normal reinstatement is no longer possible and will award compensation instead.

Settlement agreement

A settlement agreement is a written agreement between the employer and employee to terminate the employment by mutual agreement. The usefulness of a settlement agreement is that both parties can say goodbye to each other in a controlled and amicable manner, without the need for a lengthy and costly legal procedure. The agreement lays down the conditions for the termination of the employment, such as the end date, possible severance pay, agreements about holidays and agreements about, for example, the laptop of the company.

A settlement agreement usually contains provisions about the end date of the employment, the severance payment, the handling of vacation days and benefits, any non-competition or non-solicitation clause, and so on. In addition, agreements can be made about the method of communication to colleagues and possible references. A final discharge clause is often included in a settlement agreement. This means that both parties grant each other full and final discharge for any claims arising from the employment and its termination. This prevents the parties from disputes arising later about matters that have already been settled.

It is wise to obtain legal advice before signing a settlement agreement. This ensures that you as an employee are well informed about your rights and obligations and that the agreement is drawn up in a fair and just manner. If you do not agree with a signed settlement agreement afterwards, it can be difficult to change this, unless both parties agree or there are special circumstances such as error or fraud.

Labour disputes

Man calling about his labour dispute

There are many different types of labour disputes that end up in court every year. Some of the current conflicts are listed below:

Being harassed by a colleague

Colleagues can sometimes do horrible things. It ranges from sexual remarks to bullying at work. The employer must guarantee a safe working environment. Always report a problem to your employer. If they do not take any action, and the situation escalates you can contact the Equal Treatment Commission (CGB) and, if this does not help, then take court action.

Racism in the workplace

Racism is a form of discrimination. The employer must do what is necessary to prevent it and possibly intervene where necessary. It even goes so far that an employer must draw up a prevention plan to check the risks of discrimination and that they can be fined by the SZW Inspectorate. An employee who feels discriminated against can go to court or file a complaint with the Netherlands Institute for Human Rights. The advantage of the second procedure is that the Board then starts a free investigation. The results can then be used in court.

Quarrel with a colleague

The employer must make efforts to end any conflicts. Conversations or possibly even mediation should offer a solution. If that doesn't work, a transfer can always be considered. It is of course important to involve the employees in such a decision-making process. There are also examples in case law of employees who were dismissed because of such a quarrel. Often a troublemaker can be identified, a reassignment fails and all attempts to resolve the conflict have failed. Of course, an employee can oppose such a dismissal and even claim compensation.

Alcohol and drugs at work

The use of alcohol and drugs in the workplace can lead to serious problems, such as reduced productivity, unsafe situations and health problems. That is why it is important for employers to develop and implement an adequate Alcohol, Drug and Medication (ADM) policy. A good ADM policy contributes to a safe working environment, an improvement in the health of employees, a better working atmosphere and an increase in the overall quality within the company. In addition, such a policy can help prevent workplace accidents and any resulting claims for damages.

An effective ADM policy includes clear guidelines on what is and what is not allowed, education and training for employees, as well as an appropriate system for monitoring and enforcing these guidelines. Employers should also provide support and guidance to employees who are struggling with alcohol or drug problems, so that they can get the right help to deal with their problems and return to optimal functioning in the workplace.

A social media code is a set of guidelines intended to clarify the use of social media in the workplace. The purpose of a social media code is to ensure professional and responsible use of social media, both during and outside working hours. Even if a social media code itself is not included in the employment contract, it can be enforced by, for example, including it in an employee handbook. A social media code regulates matters such as to what extent employees are allowed to use social media during working hours, what they are allowed to share about the company and colleagues, and on which platforms this is allowed. Attention is also paid to what should happen with access to and use of a business social media account after termination of employment. It is important to know that the works council (OR) has the right of consent when implementing such protocols.

Use of mobile phones at work

Although there is no concrete legislation regulating the use of mobile phones at work, employers can also record agreements about this in the employee handbook. In principle, employers can prohibit mobile phone use, but it's important to be reasonable and make exceptions for situations where employees expect an important call.

Raising awareness and maintaining knowledge

Just having a good protocol is not enough. Employers should also make their employees aware of the rules regarding the use of social media and mobile phones. This can be done, for example, by making the rules accessible on the intranet, by repeating the rules in a newsletter or by putting up informative posters. Moreover, the employer is expected to set a good example and actually enforce the rules. In other words: acting consistently and sanctioning if the rules are not observed.

Possible sanctions for violating the rules regarding the use of social media and mobile phones at work range from simply addressing the employee to issuing a formal warning to withholding salary, suspension and even termination. It is essential to draw up clear rules about the sanctions that can follow for violations.

Good employee and employership

In situations where no specific rules have been drawn up, the principle of being a good employee may stipulate that certain conduct is still prohibited. This means that even without explicit rules, employees must be aware of their responsibilities and show professional behaviour with regard to the use of social media and mobile phones during working hours. Conversely, the employer can be expected to behave like a good employer and, for example, make an exception if an employee is expecting a very important phone call.

False self-employment problem

False self-employment is a situation in which someone formally acts as an entrepreneur or self-employed person without employees (self-employed person) but in practice has characteristics that are more suitable for an employee in paid employment. This can cause problems with, for example, the Tax and Customs Administration and the UWV. There are several factors that play a role in the assessment. An important factor is the degree of independence with which the work is carried out. A self-employed person usually determines how they perform the work and have the option of outsourcing work to others. In addition, a self-employed person does not receive a regular wage, such as holiday pay.

To reduce the chance of bogus self-employment and to provide more certainty for both clients and contractors, a model agreement can be used. This agreement, which has been approved by the Tax and Customs Administration, contains agreements that demonstrate that there is no employment relationship and helps to prevent ambiguities and possible sanctions.

The importance of good legal expenses insurance

Employment law contains many rules, even though it is a dynamic environment where all kinds of conflicts can arise. It is therefore not surprising that some conflicts eventually result in lengthy and expensive legal proceedings. A good legal expenses insurance is therefore recommended.

Private legal expenses insurance

Private legal insurance does not always automatically cover employment law conflicts. The option module ‘Work & Income’ often has to be completed for this. The legal assistance insurance then covers various conflicts related to employment law, such as dismissal procedures, psychological damage during working hours and conflicts about income from employment. Always take into account the underlying conditions. For example, the extra costs are often only insured up to a limited amount.

Business legal expenses insurance

Business legal expenses insurance is recommended for anyone who wants to employ staff. The general rules of employment law make it difficult to cover yourself and then there is sometimes no other option than to defend yourself in legal proceedings. The premium of such a business legal expenses insurance is of course highly dependent on the size of the company and the number of employees, but other factors also play a role. Request a quote for detailed pricing information.

Finally, know that legal expenses insurance will only reimburse the legal costs and will never pay for any claims awarded. Therefore, immediately inquire about the professional liability insurance and business liability insurance.

Frequently asked questions about employment law in the Netherlands

Is it permissible to have an employee perform other work than what was previously agreed?

That is possible, but only on the condition that it is temporary and not structural. For example, an administrative employee can be asked to step in exceptionally in the store or help with cleaning the store. However, it is not right to make him do this every day.

Can I just move an employee to another location?

That is possible, but again it should only happen temporarily. It is even possible to have an employee work temporarily in a neighbouring country. However, this should not be done on a structural basis.

What is my notice period if I want to resign?

That depends on a number of things. In principle, a permanent contract is subject to a notice period of one month. This notice period then starts on the first day of the following month. However, the employment contract may provide for a longer notice period. Such an agreement is valid and must be respected. The condition is that the notice period is a maximum of six months and the employment contract of the employer is at least twice as long. In addition, the notice period can also be shorter if this is stated in a collective labour agreement. It does not matter whether or not the shorter notice period is included in the contract. In the case of a temporary contract, there is in principle no notice period and the agreements must be adhered to until the agreed end date. However, it may be agreed in the employment contract that the employee still has a notice period. Such an appointment is valid. Finally, there may also be a probationary period. There is no notice period during the probationary period and immediate dismissal is always possible.

When does the employer have to pay my wages?

The employer is obliged to pay the wages on time. The employment contract will always indicate when this is. The employer must comply with the agreements made. In any case, the payment of weekly wages may not exceed one month and the payment of monthly wages may not exceed one quarter. If an employer does not pay on time, the employee is entitled to an increase of 5% per day for the period between the fourth and eighth working day that the employer is late and of 1% per day for the following days, with a maximum of 50% of the wages due. The court may reduce this amount, for example if the employer demonstrates that the delay is not his fault.

I have different employment conditions than my colleagues. Is this allowed?

Freedom of contract is still the principle, but there are exceptions. For example, the employer must of course still take legal rules into account, for example with regard to working hours and rest periods. The employer may also not simply discriminate. This concerns the discrimination of immigrants in relation to native Dutch people or the discrimination of women in relation to men.

When is it possible to take emergency leave?

Emergency leave is there to solve an urgent private problem. This problem must be unforeseeable or very special. In addition, it must have a personal character. In principle, the salary continues during the emergency leave. The emergency leave lasts as long as it is necessary. Often it is a few hours to a few days at the most. An example of emergency leave is a child that has fallen ill and has to be picked up from school or a water pipe that has suddenly burst, so that you have to be at home to let the plumber in.

How often is an employee allowed to work a night shift?

This is limited to 36 nights in a period of 16 weeks, unless the collective labour agreement or company scheme provides for more night shifts. In any case, it is a maximum of 140 night shifts per year and a maximum of seven night shifts in a row. If the nature of the work or the operating conditions warrant it and this is stated in the collective labour agreement, it may also be permitted to work a maximum of eight consecutive night shifts.

My employee is sick. What are his obligations?

An employee who is ill, of course, does not have to come to work. However, he must keep the employer properly informed and provide evidence. In addition, he must do everything he can to get better and cooperate in a plan of action. In principle, the employee must also accept suitable work, geared to his changed possibilities and limitations.

What is a non-competition clause and is it allowed?

A non-competition clause is a contractual provision that prohibits an employee from working for a competitor of the employer for a specified period. In principle, such a clause is only valid if it has been agreed in writing with an adult employee and this in an employment contract for an indefinite period. However, it can also be included in a fixed-term employment contract, but then the employer must provide sufficient motivation and the clause must be necessary for compelling business interests. The latter can possibly be challenged later. Only the motivation that has been included in writing will be taken into account in the assessment.