The Law on the Conditions of Employment of Posted Employees in the European Union (hereinafter WagwEU) was adopted on the basis of the European Directive on the Employment of Posted Workers. The main task of the document is to protect the rights of workers sent on a long business trip within the EU. The law applies to companies from other EU countries that temporarily bring their staff to the Netherlands.
Enforcement of the WagwEU law is entrusted to the Dutch counterpart of the Labor Inspectorate, SZW, a division of the Ministry of Social Affairs and Employment.
The law does not apply to foreign employees who are temporarily assigned to work for a Dutch employer. They are in any case entitled to the working conditions prescribed by Dutch law. The WagwEU applies to companies registered in other EU countries that temporarily come with their staff to the Netherlands.
What are foreigners temporarily posted to the Netherlands entitled to?
From July 30, 2020, all seconded employees from EU countries, not only for a long time, but also temporarily working in the Netherlands, have rights comparable to the working conditions of residents of the Kingdom. They are entitled to a Dutch minimum wage, even if it is lower in their country.
According to the Cabinet of Ministers, "equal work in the same place should be rewarded with equal pay."
Also, temporary workers from other EU countries receive the right to comply with basic working conditions: limiting work hours and providing sufficient time for rest, organizing workplace safety, calculating vacation days according to the laws of the Netherlands. The only thing that is not covered by the new law is an additional pension and protection in case of dismissal.
Improving control over compliance with labor laws during a business trip
The Employment Conditions (Posted Workers) Act in the EU allows for stricter controls on companies covered by this Act. In case of violation of Dutch labor laws, these companies can be fined. Fines are issued directly by the SZW Inspectorate.
Companies bringing employees to the Netherlands must prove that they comply with the law. For example, by storing payrolls in the workplace or having access to them digitally. In this way, companies demonstrate that their employees receive the wages they are entitled to.
From July 30, 2020, employers must clearly indicate in their administration what travel expenses they reimburse employees. For instance:
- business trip;
- accommodation;
- food.
Employers must record how much of the money paid is wages and how much is reimbursement of expenses. This way, it becomes clear what salary the employee receives and what is added to it as an allowance for expenses.
An example of a situation where the law applies
First example. The Dutch company begins construction of a residential complex. For part of the work, a contractor company from Poland is hired, which brings its employees. Despite the fact that the minimum wage in Poland is 17 zlotys per hour, which is slightly less than 4 euros, for workers from this country working at a facility in the Netherlands, the minimum wage will be calculated at the level of the Netherlands. Second example. A Dutch farmer hires a sole proprietor from Bulgaria for seasonal work such as harvesting. To help itself, in order to save money and increase efficiency, the Bulgarian individual entrepreneur brings several fellow villagers, in whose homeland the minimum hourly rate is 1,75 euros. However, under the new law, he will have to formalize them, pay the minimum wage at the level of the Netherlands (9,53 euros), and provide them with housing and food. And most importantly, keep track of the entire administration so that SZW inspectors can check the documentation on site or access it online.
What to do?
If you are a foreign contractor traveling to the Netherlands to perform work with your employees, there are a number of formalities you must complete. In particular, before starting to fulfill the contract, you must declare your work in the Netherlands through the Dutch online reporting service and provide the following details:
- provide company data;
- report employees who temporarily come to work;
- name the client;
- the sector in which activities are carried out in the Netherlands;
- workplace address;
- expected duration of work;
- the identity of the person responsible for the payment of wages;
- provide evidence that all social contributions for the brought workers have been paid.
If you are a business owner in the Netherlands and decide to hire a foreign company to perform some work, you also need to go through several procedures:
- for your part, you are obliged to check whether this information was provided and whether it is reliable;
- If there are any errors in the information provided, you must indicate this in the online reporting system and ask the foreign employer or foreign self-employed person to correct this information.
If you need advice on a question, contact us.
Publication Date: 20.08.2020
