Employing in Netherlands
The Netherlands is one of the top three countries in which our clients choose to base their employees. Why so popular…?
As our own business development manager can attest from a recent trip, everyone speaks English (and much of the wider workforce is multi-lingual). Having such a prevalence of fluent speakers of the world’s language of business is extremely attractive, especially for US businesses seeking a suitable landing place for their expansion into Europe.
Sandwiched between European superpower Germany, the de facto capital of the EU Belgium and the marine transport links of the North Sea, the Netherlands is geographically well placed to do business across Europe.
Richer than Germany and the United Kingdom (the other countries featuring in our top three expansion targets) by GDP per capita, the Netherlands has a consistently growing economy. As a result, many multinational businesses with household names have established their presence there. Will your business be the next to thrive in the kingdom of the low countries?
An employer of record, sometimes known as an international PEO can help you quickly hire and onboard workers in the Netherlands – often with just two weeks’ notice. Establishing your own local entity without risk and saving costs, this type of service makes an EOR in the Netherlands worth checking out!

An overview of employing in the Netherlands
Salary Information
Other Information
Employers costs in the Netherlands
Social security system
The Dutch social security system consists of national insurance, employee insurance and medical insurance.
The national insurance scheme comprises of state pension (AOW), surviving dependents (ANW) and exceptional medical expenses (AWBZ).
National insurance contributions and salaries tax are withheld by the employer from an employee’s salary and then paid to the Dutch Tax and Customs Administration.
Healthcare
Employees are to take out their own private health insurance as per the Health Insurance Act (Zorgverzekeringswet). The insured individual pays a premium to the insurance company which is determined by the insurer. The Health Insurance Act (ZVW) provides an income-related contribution to be paid by the insured person: the higher the salary, the higher the contribution.
Individuals can choose to take out supplementary insurance to cover anything not included in their health scheme. There’s a mandatory excess of €385 (correct for 2021) to be paid for claiming on the scheme despite having to pay a standard premium.
An overview of the main statutory benefits
Probationary period
The maximum probationary period under Dutch law is two months for indefinite contracts or contracts of at least two years, otherwise only one month’s probation is allowed. Contracts shorter than six months don’t allow for a probation period.
It’s possible to terminate the employee’s contract during the probationary period with immediate effect should they not be meeting the required standards of performance; however, protocols must be observed — TopSource Worldwide can advise clients on this.
There’s no specific action required to inform employees they have passed the probationary period.
Working hours
Full-time employment is usually 36–40 hours per week. The Working Hours Act (ATB) sets the maximum working hours per week to 60; however, an employee must not work the maximum number of hours every week.
• Per week during a four-week period: on average 55 hours per week
• Per week during a 16-week period: on average 48 hours per week
Notice periods
Notice periods can vary depending on who wants to terminate the employment. If this is the employer, the notice period is always twice as long as when the employee is requesting the notice period. A longer notice period can be agreed upon in the contract.
Interim notice is required in the employment contract to terminate a fixed-term employment contract. This enables the employee to receive unemployment benefits from the time of dismissal.
Employees: the statutory notice period to be provided by an employee is one month. However, it’s possible to agree a shorter or longer notice period with the employee, in which case it must be explicitly stated in the contract of employment. If an employee’s notice period is more than one month, this will have the effect that the employer’s notice period will be at least twice as long. The maximum notice period for an employee is six months.
Employers: where an employee notice period has not been negotiated to be longer than the statutory of one month, the statutory employer notice depends on the length of contract, with a maximum of four months.
Length of service – Notice period
Up to five years – One month
Five to 10 years – Two months
10 to 15 years – Three months
15 years + – Four months
In the event that a fixed-term employment contract ends, the employer must notify the employee in writing one month prior to the end of the employment contract. If the employer fails to do so, the employment contract ends by operation of law, but the employer must pay a penalty of one month’s salary (or the equivalent for each day it’s late). This is formally different from the ‘notice period’.
Holiday & Leave
Keen to engage an EOR in the Netherlands? At TopSource Worldwide, we work with local experts to help you navigate the various admin and cost obstacles you may come across along your expansion journey
To find out how we can help your business with our employment solutions, contact us today.
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