Human resources and employment law

Human resources and employment law

The most important long-term asset of almost any business is its qualified personnel. As mentioned before, the Netherlands is internationally renowned for its high-quality labour market. In addition, Dutch employees are flexible and have an excellent work ethic.

Human resources

The most important long-term asset of almost any business is its qualified personnel. As mentioned before, the Netherlands is internationally renowned for its high-quality labour market. In addition, Dutch employees are flexible and have an excellent work ethic.

Trade unions in the Netherlands have a moderate character and tend to operate on the premise of consensus. Union membership is generally low and where industrial disputes do occur, they are resolved quickly and pragmatically. Employers and employees cooperate in various ways through the Joint Industrial Labour Council, the Social and Economic Council, Dutch works councils and European works councils. This cooperation also contributes to stable labour relations. As a result, growth in wage costs has been kept to moderate levels, while productivity levels remain high.

It is common practice in the Netherlands to include a bonus scheme in the employment agreement of highly qualified personnel. In certain sectors bonus/reward schemes are subject to specific statutory requirements. The wording of these schemes is of utmost importance, as the right design can have tax advantages and may save the employer unexpected costs when the employment is terminated. In addition, providing benefits (rather than paying a higher salary) can have tax advantages for both the employer and the employee.

While wage costs are moderate, it is important to notice that premiums for benefits such as social security and pensions are compulsory. They are paid by both the employer and the employee.

Dutch employers can also hire ‘self-employed persons’. A self-employed person is not an employee. In practice it is sometimes hard to make a distinction between an employee and a self-employed person. The employer should make sure that the Dutch Tax Authorities cannot consider the relationship with the self-employed person as an employment.

The government is currently working on a web module to provide employers with certainty, if possible, that a labour relationship with a self-employed person is not an employment. 

In the meantime, enforcement of labour relationships with self-employed persons was in first instance suspended until 1 October 2021, with an exception for so-called malicious parties, for whom enforcement is possible. As of 1 January 2020, the Tax Administration is also able to enforce if organisations do not (or insufficiently) follow the Tax Administration's instructions within a reasonable period of time. These enforcement principles are currently still applicable, as the new government will develop further regulation regarding self-employed persons. In other words, new developments are expected in 2022.  

What can we do for you?

  • Up-to-date information about the developments in the Dutch labour market
  • Advise about employment terms and conditions
  • Advise about the position of a self-employed person

Employment law requirements

Dutch law grants employees a range of protections that create obligations and potential risks for employers. These include among others:

  • An obligation to pay employees at least the minimum wage, which is a fixed monthly rate and is increased annually (as of 1 January 2022 1,725 euro gross per month for those aged 21 and over) and holiday allowance (8 per cent of gross annual salary).
  • Maximum work periods and minimum rest periods. This means a full-time work week that normally contains not more than 40 hours per week.
  • A duty to give each employee paid holiday leave at a minimum of four times the average number of days worked per week (20 holiday days based on full-time employment). Giving employees 25 holiday days per year is considered as market practice. 
  • The limitation of the number of temporary employment contracts that can be offered to an employee (three fixed term contracts within a period not exceeding three years).
  • Various benefits for the employee in connection with childbirth, adoption and other family situations (including the right to at least sixteen weeks of pregnancy and maternity leave).
  • The obligation to pay employees during illness. During the first two years employees are entitled to: 70 per cent of their last earned salary, with a minimum equal to the monthly statutory minimum wage of 1,725 euro gross (during the first year and if 21 years or older - as per 1 January 2022) and a maximum equal to 70 per cent of the maximum monthly wage of 4,975.53 euro gross (as per 1 January 2022).
  • The requirement to establish a works council or an employee representative body. A company is obliged to establish a works council if (1) it employs 50 employees or more or (2) it is obliged to do so by an applicable CLA. An employer employing more than 10 but less than 50 workers is obliged to install an employee representative body if requested to do so by the majority of its personnel. If no employee representative body has been established, the employer is obliged to have a personnel meeting ('personeelsvergadering') at least twice a year or when requested by its employees. 
  • A limitation of the employer’s freedom to process personal data obtained about its employees and job applicants.
  • A general duty to provide a safe place of work, safe access and safe work systems, supported by related obligations such as consulting with employees or their representatives on health and safety issues and providing staff with certain health and safety information.
  • An obligation not to discriminate against employees, including job applicants, on a range of grounds. According to several equal treatment regulations. 
  • The obligation to pay employees a statutory severance payment ('transition allowance') upon termination. Employees are entitled to a (prorated) transition allowance as per the first day of their employment (including termination within the probationary period) and if the termination or the non-renewal of a contract (incl. after sickness or expiration of a definite term contract) is initiated by the employer. The transition allowance amounts to 1/3 of a gross monthly salary for each service year. As of 1 January 2022, the maximum transition allowance amounts to 86,000 euro gross or to a gross annual salary, should that be higher than 86,000 euro. The gross monthly salary includes 8 per cent statutory holiday allowance, year-end allowance (13th month), structural allowances and bonuses.
  • Several dismissal law rules and statutory protection from dismissal rules. 

It is recommended that employers have a comprehensive employment contract in place for every employee, which includes all the terms and conditions of employment and in addition protects the employer’s business interests by imposing obligations on the employee (e.g. about confidentiality of business secrets or restrictions of certain competitive activities after the employment ends).


All foreign nationals who intend to work and stay in the Netherlands are required to comply with the immigration regulations of the Netherlands. The Netherlands has a less restrictive admittance policy for highly skilled workers of multinational companies who meet specific (salary) criteria.

EEA/Swiss national

No immigration requirements are applicable to EEA (or Swiss) nationals. In case the stay of an EEA national exceeds four months he/she needs to register with the local municipality in the city of residence (see ‘Registration municipality’ under ‘Non-EEA national’).

Non-EEA national

According to the Dutch Foreign Employment Act an employer needs to be in possession of a work permit for a non-EEA national who will perform work activities in the Netherlands.

For stays shorter than 90 days in a rolling 180 day period the non-EEA national may need a Schengen visa (for business or tourist purposes) to enter the Netherlands. A (business) Schengen visa does not allow the non-EEA national to work in the Netherlands.

In case the intended stay will exceed 90 days within a rolling period of 180 days a residence permit is required to legally be allowed stay in the Netherlands. In addition, a long term entry visa (MVV) is required before entering the Netherlands for most nationals (except for nationals from the UK, US, Canada, Australia, South Korea, Vatican City, New Zealand, Monaco and Japan). In case the company of the foreign national is registered as a recognised sponsor and the foreign national is in possession of a valid residence permit issued by another Schengen country, no long term entry visa (MVV) is required. This exemption applies to the highly skilled migrant procedure (see below). 

Which immigration procedure has to be initiated, depends on the specific facts and circumstances. The work permit procedure and the highly skilled migrant procedure are the most commonly used procedures.


While the UK left the EU on 31 January 2020, the rules regarding free movement continued to apply until 31 December 2020 based on the Withdrawal Agreement. This means that there is in principle no change to the rights of UK nationals to entered, worked and resided in the Netherlands before 31 December 2020.

Any UK national who resided in the Netherlands before 1 January 2021 is allowed to continue to do so after this date. The main requirements are that the individual registered at the town hall of the municipality where they resided before 1 January 2021 and that they have sufficient income (e.g. through paid employment). UK nationals who resided in the Netherlands for 5 years or more are eligible for a permanent residence permit while those who have not may apply for a temporary residence permit (valid for 5 years). Once these individuals have reached 5 years residence they will also be allowed to apply for permanent residence. The deadline for submission of the initial application under the Withdrawal Agreement is 30 September 2022 (postponed from 30 June 2021).

However we note that UK nationals without a pending or approved application under the Withdrawal Agreement (or other type of Dutch residence permit) do not have a lawful immigration status in the Netherlands from 1 October 2021, even if they arrived in the Netherlands before 1 January 2021. If they apply for a permit under the Withdrawal Agreement before 1 October 2022 and it is approved, their residence status will be restored to lawful status from 1 October 2021.

The Withdrawal Agreement also ensures that UK and EU nationals who are ‘frontier workers’ may continue to pursue their activities after the end of the transition period. This is intended to secure the rights of, for example, UK nationals who regularly work in an EU member state but do not reside there. The current requirements are that the UK national resides in the UK or another EU country and worked in the Netherlands before 1 January 2021 regularly and will do so after this date as well. This set-up must also be formalized in a local contract with an employer in the Netherlands. The employee should also in principle have a Dutch tax registration number (BSN). The deadline for submission of this application is also 30 September 2022.

UK nationals arriving in the Netherlands after 1 January 2021 are subject to Dutch immigration legislation. This means they are allowed to enter and stay in the Schengen area (which includes the Netherlands) for up to 90 days in 180 days on the basis of their passport. Their passport must be valid for at least 6 months. However they will require a work permit in order to work in the Netherlands from day 1. They will also require a residence permit in case their stay exceeds 90 days in 180 days.

Work permit procedure

There are various types of Dutch work permits (e.g. for intra-company transfers and trainees). For some non-EEA nationals a single application for a combined permit for work and stay (GVVA procedure) needs to be applied for in case they plan to work and stay in the Netherlands for more than 90 days in 180 days. This procedure however is not always applicable as a number of exceptions exist. If the GVVA procedure does not apply, a separate work permit should be applied for in addition to the MVV visa and residence permit.

For non-EEA nationals assigned to a Dutch entity within the same group, the intra-company work permit procedure for key personnel may be applicable. The worldwide turnover of the group needs to be at least 50 million. Furthermore, the employee must be in the possession of at least a bachelor’s degree, have a management or key position and earn a gross monthly salary of at least 4,840 euro (5,227.20 euro including holiday pay, figure 2022).

The legal processing time for a combined permit is 3 months from date of submission. However in practice this can be six to eight weeks.

Highly skilled migrant procedure

A residence permit for a highly skilled migrant allows a non-EEA national to reside and work legally in the Netherlands (without a separate work permit). The following requirements have to be met:

  • The company must be registered as a recognised sponsor with the Dutch Immigration and Naturalisation Service (‘IND’).
  • The employee should have a gross monthly market conform salary of at least 4,7840 euro (5,227.20 euro including holiday pay, figure 2022) or 3,549 euro (3,832.92 euro including holiday pay, figure 2022) if the employee is younger than 30 years old.

If an MVV visa is required on the basis of the nationality, the visa and residence permit can be applied for simultaneously under the so-called TEV procedure. The processing time for this residence permit (including or excluding MVV visa) is two to four weeks.

Please note that a 30 per cent tax allowance for this category of employees might be applicable (see ‘Personal income tax’).

Registration municipality

In case the stay in the Netherlands is less than four months, registration as a non-resident in the Municipal Population Database at one of the eighteen designated offices is voluntary, but required in order to obtain a Dutch citizen service number (BSN) needed for tax and payroll purposes.

For a stay of at least four months within a period of six months, registration with the Municipal Population Database is required.

What can we do for you?


  • Setting up a works council which can include but is not limited to drafting works council regulations, organising works council elections, time-planning etc.
  • Give guidance in creating a safe and healthy work environment
  • Analyse whether the activities of your company fall under the scope of a mandatory CLA
  • Advise about Dutch labour law such as the various minimum leave requirements, (drafting) employment contracts and (strategies on) how to terminate an employment contract
  • Advise on how to deal with personal data of employees
  • Advise on immigration options and apply for the appropriate permits


Accounting and audit

A company is required to maintain accounting records that are sufficiently adequate to determine the financial position of the company at any time. There are various regulations, including civil and tax regulations, stipulating the period for which the records should be retained. As a general rule, the records must be kept for a period of seven years.

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Knowledge Centre

Rotterdam, PwC Netherlands

Tel: +31 (0)88 792 43 51

Jan-Willem Thoen

Jan-Willem Thoen

Senior Director, PwC Netherlands

Tel: +31 (0)61 002 95 71

Mariska van der Maas

Mariska van der Maas

Director, PwC Netherlands

Tel: +31 (0)62 422 10 29