Why work in
Grow your team in
Growing a team means hiring the right employees at the right time and for the appropriate positions. Employers in Portugal must have a local legal organisation and use local resources to handle compliance, payroll, tax, and benefits management. The complexity of employment regulations in Portugal demands compliance with employment laws.
With Gloroots’s global Employer of Record (EoR) service, you can let Gloroots do the heavy lifting of payroll, tax, benefits, and compliance and concentrate on what matters to you most: your employees and company growth.
Risks of misclassification
The Netherlands treats contractors, sole proprietors, self-employed individuals and full-time workers differently and there are significant risks associated with misclassification.
In the Netherlands, no single statute covers all aspects of employment law. Instead, it is governed by statutory rules enshrined in (among other laws) the Dutch Civil Code. Additionally, it is governed by (among other things) Collective Labor Agreements (Dutch Collectieve arbeidsovereenkomst, CAO) in certain industries, internal rules (if applicable), and the specific employment contract itself.
This might sound overwhelming—but it doesn’t have to be. A solution like Gloroots eliminates the barriers for you. With Gloroots’ Employer of Record offering, hiring and managing employees globally is a piece of cake.
Get an overview of what you need to know when hiring in the Netherlands.
Legal aspects of employing in
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In the Netherlands, a regular workweek consists of between 36 and 40 hours, or 7 to 8 hours per day, during a five-day workweek. Four-day work weeks could be feasible in some professions. According to the Dutch Working Hours Act, an employee's regular weekly working time cannot exceed 45 hours, with a daily maximum of nine hours.
The Working Hours Act requires companies to adhere to the following rules regarding breaks and rest periods:
- every 24 hours, at least eleven hours must be spent sleeping.
- if the worker works a five-day week, at least 36 hours of uninterrupted rest every week.
- if the worker works a six-day week, at least 72 hours of uninterrupted rest every 14 days.
- a break of at least 30 minutes after 5.5 hours of nonstop work
- if the worker is on duty for more than 10 hours straight, they should take a break of at least 45 minutes.
Employers and employees must agree on a fair pay rate when discussing the terms of employment because there is no legal requirement for overtime pay in the Netherlands.
Employees are never permitted to work more than twelve hours in a day or 60 hours in a single workweek.
Employees in the Netherlands typically receive a minimum of four weeks of paid yearly leave or 20 days if the individual works a five-day workweek. Even more, paid vacation days are included in several collective bargaining agreements. Annual leave entitlements might range from 20 to 32 days, depending on the industry.
There are nine public holidays in the Netherlands; however, unlike in other nations, no one is automatically entitled to more time off. Employers may ask their workers to work on public holidays without offering them any additional compensation if there is no collective agreement in existence that governs such labour.
It is usual to pay employees monthly. Typically, payments are made at the end of the month.
The Netherlands' minimum wage depends on the employee's age. In general, Dutch law distinguishes between workers under the age of 21 and those who are 21 or older. The statutory minimum wage is typically modified twice a year, on January 1 and July 1.
Minimum wage rates mandated by law as of January 2022:
Employees above the age of 21: €1,725.00 per month, or €398.10 per week and €79.62 per day
Employees between the ages of 15 and 20 receive monthly wages ranging from EUR 517.50 (for those aged 15) to EUR 1,380.00 (for those aged 20), or EUR 119.45 to EUR 318.50 per week EUR 23.89 to EUR 63.50 per day.
Employees who are unable to report to work due to illness or accident are entitled to 70% of their regular pay, or at least the minimum wage. The duration of sick leave is limited to two years, during which the employer may not fire an absent employee unless a collective agreement or the Employee Insurance Agency permits it (UWV).
Female employees are entitled to 16 weeks of paid maternity leave. Employees must submit a pregnancy form to avail these leaves. The form must be submitted at least 3 weeks prior to the commencement of their leaves.
Laws mandate that maternity leaves can be availed 6 weeks prior to the due date and ten weeks after their child’s birth. Employees can avail more leaves on the following circumstances:
- If the employee avails less than 6 weeks (but no less than 4 weeks) before the birth, she can take the remainder of the leaves after the birth.
- If there is a delay in the due date, then the employee's maternity leave begins after the actual birth. This may be longer than 16 weeks.
Note: Employees can apply for reimbursement for their employee’s maternity leaves from the Employee Insurance Agency.
Fathers or partners (including same-sex partners) are entitled to 1 week of paternity leave paid by their employers and 5 weeks of 70% of their wages (maximum daily wage: EUR 160.13) as a benefit. Paternity leave is available to part-time workers for one working week.
Parents/main caregivers of children under eight are entitled to unpaid parental leave in the Netherlands. Parents are entitled to unpaid parental leave equivalent to 26 times their weekly work hours per child. There are two types of leave: part-time and full-time.
Tax and Social security contribution
25.8% corporate tax rate (15% on income below EUR 395,000)
21% VAT (standard rate)
Total employer contribution rate for salaries up to EUR 59,706 is around 22%, which includes:
Unemployment Insurance (WW): 2.7% or 7.7% depending on contract type and industry
Work and Income Insurance (WIA) & Invalidity Insurance (WAO): 5.49% or 7.05% plus variable contribution
Health Insurance (ZVW): 6.7%
Individual income tax rates
- up to EUR 35,472: 9.42%
- up to EUR 69,398: 37.07%
- over EUR 69,398: 49.5%
The total employee contribution rate on annual earnings up to EUR 35,472 is 27.65%, out of which:
- National Old Age Pension (AOW): 17.9%
- Long-term Care (WLZ): 9.65%
- National Survivor Benefits (ANW): 0.1%
The maximum statutory notice time for an employer is four months, depending on the length of employment.
The duration of the probationary or trial phase is contingent upon the duration of the employment contract. The maximum probationary period is two months. Employer and employee are equally subject to the probationary term.
Employment Termination and Severance
In addition to an employee's employment is terminated by mutual agreement, by default – that is, in the case of a contract with a fixed-term duration – or by resignation, Dutch labour law also provides for an employee's dismissal for gross misconduct, reasons related to the company, as well as for extended absences from work due to illness. Both of these categories are in addition to the other employment termination options. However, the authorization of the Dutch Employee Insurance Agency is required for the remaining two possible scenarios.