An easy first step to employing people in the Netherlands
There are many reasons the Netherlands is a great place to live and work. Its strategic location as the gateway to Europe, world-class infrastructure, and innovative business-friendly environment are attracting companies from all over the world. Individuals also enjoy living here because everyone speaks English and, according to the latest UN World Happiness Report, the Netherlands is one of the top 10 happiest countries in the world with an exceptional quality of life.
But, for you as an employer, navigating a new market is always a challenge. Particularly when it comes to employment laws, contracts, tax and payroll. If your business is looking to employ people in the Netherlands, you generally have three broad options:
1. Set up as a Dutch company (BV)
2. Register as a non-resident employer with the Dutch tax authorities
3. Partner with a Professional Employer Organisation (PEO) who offers Employer of Record (EOR) services.
The option you choose will depend on many factors, such as the size of your business, how many people you need to employ and your future plans. However, for many companies taking their first steps into the Dutch market, employing people directly feels too risky and too burdensome. Using EOR services can make your life so much easier.
What is Employer of Record (EOR) and how it can help me?
For a fixed fee, a Professional Employer Organisation (PEO), such as Blue Clue, can offer a complete EOR umbrella service. We effectively act as an employer on behalf of our clients. This makes a lot of sense if you are, for example, taking on your first few employees in the Netherlands perhaps to research the market or service existing clients.
It’s an easy first step into the Dutch market because:
1. We provide payroll services including:
• Monthly salary calculations and payslips (in Dutch and English) for you and your employees or contractors • Monthly payroll tax filing • Monthly pension premium filing (after six months) • A1 certificate for Dutch social security for employees • Payroll tax appeals, if required • Annual income statements • Free phone calls and email correspondence.
2. You won’t have to worry about all the Dutch employment laws and exceptions.
If you are employing people directly, you will need to consider a wide range of laws concerning long-term illness and disability insurance and arbondienst (a form of occupational health and safety service) for your employees. There are also a range of different rules governing temporary and permanent employment contracts, probation periods, redundancy and dismissal.
3. You have more flexibility
As a PEO we can also offer four and a half years of flexible employment contracts, under the temp agencies collective labour agreement. In Dutch law, the fourth temporary contract within 24 months is otherwise re-qualified as a permanent contract.
In summary, while EOR services will not suit every business, they are worth considering if you are taking your first steps into the Dutch market. Partnering with a PEO, such as Blue Clue, takes away the hassle, stress and worry of complying with numerous pieces of employment legislation. It leaves you free to focus on what you do best – running your business.
We are always happy to advise companies and individuals on the best options for their Dutch employment contracts, payroll and tax considerations. If you have any questions, please get in touch.