Q1 Update (January – March 2025)

Legislation

Internet consultations

In our continuous effort to keep you informed on legislative developments, we wish to highlight the current consultation phase for upcoming legislation. This phase is an important step in the legislative process, allowing stakeholders to review and comment on proposed bills.

The following draft bills were opened for consultation:

• Act implementing the Pay Transparency Directive (EU) 2023/970 (Wet implementatie Richtlijn loontransparantie mannen en vrouwen): This draft bill is open for consultation until 7 May 2025. The aim of the bill is to promote equal pay for men and women. The proposal includes various measures to ensure pay transparency. Measures are also included to improve the legal protection of employees.
• Strengthening the labor market infrastructure (Wijziging van de wet SUWI in verband met de versterking arbeidsmarktinfrastructuur). This draft bill is open for consultation until 29 April 2025. With this bill, workers, job seekers, and employers will receive better access to services in the areas of work and education. The bill strengthens the cooperation between public parties (UWV and municipalities) and the collaboration between these public parties and private parties within the regional labor markets.
• Introduction of a mandatory code of conduct for undesirable behavior (Wijziging van de Arbeidsomstandighedenwet in verband met de invoering van een verplichte gedragscode ongewenst gedrag). This draft bill is open for consultation until 23 maart 2025. It requires a code of conduct for undesirable behaviour for employers with 10 or more employees.
• Limitation of the compensation scheme for transition fees in the event of dismissal due to long-term illness to small employers (Wijziging van Boek 7 van het Burgerlijk Wetboek in verband met het beperken van de compensatieregeling transitievergoeding bij ontslag wegens langdurige arbeidsongeschiktheid tot kleine werkgevers). This draft bill is open for consultation until 19 March 2025. With this bill, the statutory compensation scheme for a transition fee in the event of termination of the employment contract after long-term illness will be limited to small employers.
• Introduction of a permit requirement for asbestos work (Wijziging Arbeidsomstandighedenwet in verband met een vergunningplicht voor bepaalde asbestwerkzaamheden). This draft bill is open for consultation until 2 April 2025. With this amendment to the Working Conditions Act, a permit is required for companies that carry out demolition or asbestos removal work.
• Social affairs and employment act 2026 (Verzamelwet SZW 2026). This draft bill is open for consultation until 17 March 2025. This bill is intended to technically maintain and optimize legislation. Technical amendments are changes with no substantive component, such as correcting references and improving linguistic formulations.

Case law

We have made a selection of the most significant recent employment law cases for employers, from the following courts: 

• The Supreme Court (Hoge Raad)
• The Court of Justice of the European Union (CJEU)

Supreme Court: Relevance of ‘external entrepreneurship’ for qualification of employment agreement (Uber-case)

This case addresses whether Uber drivers operate under employment contracts. Specifically, the Supreme Court examines the factor entrepreneurship' within the framework for qualifying an agreement as an employment contract, as outlined in the Supreme Court's Deliveroo ruling of 24 March 2023.

In the Deliveroo ruling, the Supreme Court did not prioritize the various factors relevant to determining whether an employment contract exists. The factor of 'entrepreneurship' is therefore as significant as the other factors. The Supreme Court sees no reason to establish a hierarchy among these factors now. It remains possible that the decisive factor in determining whether an agreement is an employment contract could be whether the worker behaves or can behave as an entrepreneur in the economic market, even if other factors suggest an employment contract. Consequently, it is possible that the same work performed for the same company may not constitute an employment contract for a worker with 'entrepreneurship' but may do so for a worker without 'entrepreneurship.' 'Entrepreneurship' in the context of the Deliveroo ruling pertains to the general (entrepreneurial) situation of the worker and may also involve circumstances beyond the specific relationship between the worker and the company.

Practice note: when qualifying and employment relationship no hierarchy exists among the factors relevant in determining if the relationship as an employment agreement. And ‘external entrepreneurship’ is (also) a relevant factor.  

Reference: Supreme Court 21 February 2025, ECLI:NL:HR:2025:319

Supreme Court: When do pension contribution claims expire?

The mandatory industry-wide pension fund for the travel sector demands that Booking.com is required to participate in the pension scheme, effective from 1 January 1999. In 2021, the Supreme Court ruled that Booking.com indeed falls within the scope of this pension fund. The central question in this procedure is when the pension fund's contribution claims expire.

The Dutch Supreme Court ruled that the statute of limitations for a claim by an industry pension fund against an employer for the payment of contributions is governed by Article 3:308 of the Dutch Civil Code (DCC). According to this provision, the limitation period is five years from the day the claim becomes due. A contribution claim for a specific period becomes due at the time of payment specified in the implementation regulations (uitvoeringsreglement), within the limits set by Article 26 Pension Act. If this due date depends on an action by the pension provider, such as sending a contribution invoice, and this action has not been taken, the claim is deemed to have become due at the latest payment date specified in Article 26 Pension Act.

The Supreme Court also noted that the limitation period under Article 3:308 BW is extended pursuant to Article 3:320 DCC in conjunction with Article 3:321 DCC, introductory sentence and subparagraph f, DCC if the employer has deliberately concealed the existence or the due date of the contribution claim from the industry pension fund. Additionally, under certain circumstances, an employer's reliance on the statute of limitations of Article 3:308 DCC against the industry pension fund may be deemed unacceptable according to standards of reasonableness and fairness.

Practice note: The Supreme Court has clarified the limitation period for pension contribution claims. However, if an employer is erroneously not affiliated with a mandatory industry-wide pension fund, the fund may seek to claim damages. The limitation period for a damages claim is also five years, but this period only starts to run once the pension fund is aware of the damage and the liable employer. Through this route, the pension fund may potentially be able to go back further in time.

Reference: Supreme Court 21 March  2025, ECLI:NL:HR:2025:423

Supreme Court: Collective labor agreement for secondary vocational education (CAO MBO) violates gender equality?

This case concerns the collective labor agreement for secondary vocational education. Employees were entitled to 30 vacation days and approximately 30 'other days' on which they were not required to work, but which were not designated as vacation days by the collective labor agreement. The collective labor agreement does not provide compensation when these 'other days' coincide with maternity and childbirth leave. The question presented to the Supreme Court is whether this arrangement constitutes gender discrimination.

The Supreme Court, based on (European) legislation and case law, emphasizes that gender discrimination is prohibited. Women must not be treated less favorably than men regarding their employment conditions. Distinction based on pregnancy is considered a distinction based on gender. The question is whether the 'other days' are an employment condition. The Supreme Court considers that the 'other days' in the collective essentially do not differ from vacation days and will be regarded as such by employees. It is therefore logical that the 'other days' in the collective labor agreement are an employment condition. Based on this, the arrangement in the collective labor agreement results in women being treated less favorably than men in terms of employment conditions, which is prohibited.

Practice note: The Supreme Court has interpreted the concept of employment conditions broadly. This has, among other things, the consequence that such an employment condition falls within the scope of equal treatment legislation.

Reference: Supreme Court 21 February 2025, ECLI:NL:HR:2025:320

Other

Letter to Parliament on working with and working as self-employed worker(s)

On 27 March 2028, the Minister of Social Affairs and Employment (SZW) informed the Parliament about developments regarding working with and as self-employed individuals. The letter includes the following key points:

Continuation Bill for Clarification of the Assessment of Employment Relationships and Presumption of Employment (WVBAR) after recent Uber-case

The original WVBAR considers factors that suggest either an employment contract or self-employment. Only if these factors do not clearly determine the nature of the employment relationship, the worker's entrepreneurial activities outside the specific employment relationship will be evaluated.

The Supreme Court's ruling in the Uber case deviates from how external entrepreneurship is considered in the WVBAR. Therefore, the minister will amend the bill to align it with this ruling. As a result, external entrepreneurship will become one of the factors considered in assessing the employment relationship. This factor will no longer only be considered in situations where the previously mentioned indicators do not lead to a clear judgment about the employment relationship.

The amended WVBAR is expected to be submitted to the Parliament before the summer in 2025. According to the minister, publication by 1 January 2026, is still possible, although the timeline is very tight.

Current status regarding the end of the enforcement moratorium on false self-employment as of 1 January 2025

As of 1 January 2025, the Tax Authorities can fully enforce the classification of employment relationships again. However, the first year will feature a ‘soft landing’ approach. The minister reports that many organizations have proactively addressed the issue of false self-employment. For example, sectors such as healthcare, education, and childcare have encouraged workers, who were previously possibly operating as false self-employed workers, to become employees. Additionally, some organizations are adapting their working methods to clarify when an assignment can be carried out by a self-employed person.

Although the enforcement moratorium has only been lifted for three months, there is already data indicating shifts in the labor market. However, it is unclear whether these shifts are directly attributable to the lifting of the enforcement moratorium. Between December 2024 and February 2025, there has been a small decrease in the number of self-employed individuals registered in the trade register, marking a break in the trend.

The new simplified procedure at the ‘regelrechter’ for employment disputes

From 1 March 2025, litigants with simple civil cases can approach a new ‘regelrechter’ at the courts in The Hague, Overijssel, Rotterdam, and Zeeland-West Brabant. This allows them to present disputes to a judge easily and at low cost. The simplified procedure covers, among other thing, disputes between employers and employees, such as issues regarding pay or holidays, but excludes dismissal cases. It is particularly aimed at employees in vulnerable positions, such as migrant workers and temporary workers. They often find themselves in a dependent and weaker position relative to their employers.

The simplified procedure will exist alongside the normal procedure at the subdistrict court. The party initiating the case will decide which of the two procedures will be followed. The defendant must follow this choice. Unlike the normal procedure, the simplified procedure allows cases to be initiated or defended using a simple form, which can also be submitted digitally. There is no need for a bailiff to start a case, and no legal documents need to be drafted.

Another significant difference from the normal procedure is that every case will involve a hearing. During this hearing, the judge will explore the possibilities for the parties to reach a mutual agreement.

The simplified procedure at the ‘regelrechter’ is an experiment that will last for three years and will be evaluated during its course. Based on the evaluation, it will be determined whether to make the procedure or elements of it permanent.

Amendments as of 1 January 2025

End of enforcement moratorium on false self-employment

On 1 January 2025 the enforcement moratorium on false self-employment will end. The main consequences are:

• From 1 January 2025, the Tax Authorities will apply the normal rules for imposing correction obligations, additional tax assessments, and fines when enforcing the classification of the employment relationship for payroll taxes. The enforcement will primarily focus on payroll taxes at the companies.
• The Tax Authorities will consider the previous enforcement moratorium and will only retroactively correct up to the date of its lifting, i.e., 1 January 2025.
• For the period before 1 January 2025, the Tax Authorities can only impose corrections, taking into account the five-year statute of limitations, if there is malicious intent or if a previously given instruction was not followed adequately. In such cases, corrections and additional tax assessments can be imposed up to the moment of malicious intent or when the instruction was given.
• The government wants to prevent well-intentioned companies from being immediately confronted with fines after the moratorium ends. Therefore, it has been promised to ensure a 'soft landing.' In 2025, the Tax Authorities will not impose fines for the qualification of employment relationships. From 2026 onwards, the normal rules for imposing fines will apply.
• The assessment of model agreements by the Tax Authorities will be discontinued. All existing approved model agreements will be honored until the end of 2029. Parties can continue to use them until the end date. However, they only provide certainty if the company and the self-employed person actually work as agreed in the model agreements. If it turns out that a model agreement does not comply with laws and regulations, or due to new court rulings or new legislation no longer complies, the Tax Authorities will withdraw the approval. Furthermore, the Tax Authorities can withdraw an approved model agreement if it appears that the conditions in the agreement are not being followed.

The government aims to create more clarity regarding the distinction between working as an employee and as a self-employed person, in addition to resuming enforcement. This is addressed in the Bill for Clarification of the Assessment of Employment Relationships and Presumption of Employment (WVBAR). This proposal codifies relevant case law on the qualification of employment relationships into a more comprehensible assessment framework. On 11 November 2024, the Council of State (Raad van State) published a critical advisory opinion on this draft proposal. The Minister of Social Affairs and Employment intends to submit the (amended) proposal to the House of Representatives in Q1 2025. However, the (draft) annual planning of the Ministry of Social Affairs and Employment indicates that this timeline is subject to change.

30%-Ruling becomes ‘expat scheme’

The Dutch Tax Authority will refer to what is currently known as the 30% ruling as the ‘expat scheme’.

As of 1 January 2024, the 30% ruling has been amended. The maximum amount of the tax-free allowance is no longer 30% over the entire duration but will decrease over time: a maximum of 30% for the first 20 months, a maximum of 20% for the next 20 months, and 10% for the last 20 months of the term. This amendment will be reversed in 2025. However, in the 2025 Tax Plan, the government proposes another modification. Starting in 2027, the maximum percentage of the tax-free allowance will be reduced from 30% to 27%. This percentage will then apply for the entire (remaining) period of 60 months. For 2025 and 2026, the maximum percentage remains 30%. Additionally, the government intends to increase the salary threshold for incoming employees from EUR 46,107 to EUR 50,436 as of 1 January 2027. The salary threshold for incoming employees under 30 years old with a master's degree in academic education or an equivalent foreign degree will be increased from EUR 35,048 to EUR 38,338.

The transitional arrangements are as follows:

CO2 Reporting for work-related mobility of persons

Employers with 100 or more employees are required to report on the CO2 emissions from work-related mobility of persons. This includes both commuting and business travel. Employers must submit the report for 2024 to the Netherlands Enterprise Agency (RVO) by 30 June 2025, at the latest. Employers can choose to report for the entire year of 2024 or only for the second half of 2024. More information can be found on the RVO website.

Unemployment benefit contributions and overtime

Employers pay lower unemployment benefit contributions for permanent employment contracts and higher contributions for flexible contracts. Employees with a permanent employment contract are allowed to work overtime for up to 30% beside their regular hours. As long as employees do not exceed that percentage of overtime, employers do not have to pay a higher rate of WW-premiums. As soon as an employee works more overtime than 30% during a whole year, the higher rate applies retrospectively.

This maximum percentage for overtime does not apply for employment contracts of 35 hours per week or more: these contracts will be exempt from this rule. On 1 January 2025 this threshold will be reduced to 30 hour per week or more. As a result employers will not have to pay the higher unemployment contribution rate if the amount of overtime worked is more than 30%. This provides more flexibility.

Abolition of the low-income benefit and changes to wage cost benefits (LKV's)

• LIV:  As of 1 January 2025, the low-income benefit (LIV) will be abolished. Employees will still receive the LIV for 2024 in 2025.
• LKV for re-employing disabled workers:  As of 1 January 2025, the criteria for the LKV for re-employing disabled workers will be expanded. As a result, employers will qualify for this LKV in more cases.

• LKV for older workers: The LKV for older workers will be gradually phased out for employment contracts that have begun on or after 1 January 2024. As part of this, the amount of the LKV for older employees will be reduced starting in 2025. This LKV will be completely abolished by 2026. For employment contracts that began 1 before January 2024, nothing will change.

State pension age unchanged in 2030

The state pension (AOW) age for 2025 – 2027 is 67 years, and for 2028 and 2029, it is 67 years and 3 months. Minister Van Hijum (Social Affairs and Employment) has announced that the AOW age in 2030 will remain unchanged at 67 years and 3 months. For more information, see the website of the Dutch government.

Indexations

• Increase in maximum transition fee: The maximum transition fee in 2025 is EUR 98,000 gross (2024: EUR 94,000 gross) or a maximum of one annual salary if the salary exceeds this amount.
• Increase in maximum payment under the Executives' Pay (Standards) Act (WNT): For 2025, the general maximum remuneration under the WNT is set at EUR 246,000 gross (2024: EUR 233,000 gross). The WNT limits the compensation of top officials in the (semi-)public sector. Different maximums apply to sectors such as education, culture, media, housing associations, healthcare, and development cooperation. A higher maximum is applicable to health insurers. An overview of the WNT remuneration maximums for 2025 is available at the website www.topinkomens.nl. The new Implementing Regulations WNT 2025 (Uitvoeringsregeling WNT 2025) and Policy Rules WNT 2025 (Beleidsregels WNT 2025) have now been published. These regulations have been adjusted on several points. For instance, the premium for directors' liability insurance is excluded from the remuneration, and there is an explanation of the consequences of the WNT for either an agreed-upon or court-awarded (fixed) compensation for wrongful termination (e.g., when not taking into account the applicable notice period).
• Tax-free home working allowance: The tax-free allowance for home working will be increased to a maximum of EUR 2.40 per day in 2025 (2024: EUR 2.35).
• Work-related expense scheme: the free space for the wage bill up to and including EUR 400,000 will be 2% (2023: 1.92%). The free space for the wage bill exceeding EUR 400,000 remains unchanged at 1.18%.
• RVU exemption threshold: The RVU exemption threshold amounts to EUR 2,273 gross per month in 2025 (2024: EUR 2,182 gross per month).
• Maximum pensionable salary: The maximum pensionable wage as of 1January 2025, has been provisionally set at EUR 137,800 gross (2024: EUR 137,800 gross). 

For a comprehensive overview of the (other) tax changes related to labour and wages as of 1 January 2025, see the Dutch Tax Authorities' Newsletter on Payroll Taxes 2025.