On 22 November 2023, parliamentary elections took place in the Netherlands. After several months of negotiations, the intended coalition parties presented their outline agreement on 16 May 2024. The following are some highlights of the coalition’s agenda with regard to labour law.  

The coalition parties want more security in the labour market by combating false self-employment. An existing draft bill dealing with this issue will be developed further. Under the draft bill, any purportedly ‘self-employed’ worker with an hourly rate of €32.24 gross or less will be presumed not to be self-employed but rather as having an employment contract with the employer. This means that the worker will have the rights of an employee (e.g. continued payment during illness, accrual of paid holidays, holiday allowance, an indefinite-term contract after a number of fixed-term contracts, and protection against dismissal). 

In addition, the bill contains a clarification of the term ‘relationship of authority’, which is one of the three elements of an employment relationship. In short, the bill provides that a relationship of authority exists where the work is performed under substantive supervision of the employer, and/or if the work is embedded in the organisation, and the worker does not perform the work at his or her own expense and risk.   

The coalition has further stated that it will strive towards having more indefinite-term employment contracts. However, there do not seem to be any concrete plans for that as of yet. 

The coalition parties want to regulate the employment agency sector through an entry requirement. This should also help to combat exploitation of foreign workers by abusive employment agencies. A bill to this effect has already been drafted and will be discussed further.

The qualification requirements of the Highly Skilled Migrant scheme (HSM visa) will be made stricter. And although the coalition agreement says nothing on the topic, the recent modifications to the ‘30% rule’ (a tax benefit for employees recruited from abroad) may well be reversed. As for the extraterritorial expenses scheme, which allows gross wages to be exchanged for untaxed allowances, the coalition wants to see whether tax benefits can actually be scaled down. 

In addition, the coalition plans to introduce a compulsory work permit for non-EU migrant workers hired through another EU country, although there are doubts whether this is legally feasible. The coalition also intends to make employers of migrant workers legally responsible for nuisance and costs of migrant workers without regular housing. Moreover, for longer term stay of migrant workers, the employer will be required to ensure that they learn the Dutch language. 

Reimbursement from the government to employers for the statutory transition payment for dismissal due to long-term illness (after the two-year obligation to continue payment of wages has expired) will be limited to small employers. Starting from 1 July 2026, employers with 25 or more employees will no longer be able to apply to the UWV for reimbursment for this transition payment. 

The coalition plans to reform the unemployment benefits. This still needs to be worked out in more detail, but the coalition is considering shortening the duration of benefits from 24 to 18 months and/or extending the employers’ notice period. The latter would mean higher financial burdens for employers when making a dismissal. 

There are existing plans to amend the legislation on non-compete clauses. The main expected changes are a limitation on the duration of the non-compete clause, further requirements on the written justification for a non-compete clause, and legally mandated compensation to the employee if the employer invokes the non-compete clause. The coalition agreement says nothing about this bill. However, our expectation is that the bill will be discussed further, to improve labour market mobility and bring Dutch legislation more in line with that in other European countries. 

The concrete implementation of these plans and their impact on existing labour laws and regulations is still unknown. However, the coalition agreement does give some signs as to what changes are likely to come for employers.