NederlandsWith the Balanced Labor Market Act (WAB), the government wants to bring more balance between flexible work and a permanent contract. Een of the amendments is the new regulation for payroll agreements, whereby payroll employees receive the same employment conditions and legal position as employees who are directly employed by you. What does that mean for you as an employer?
What is a payroll agreement?
From a legal point of view, temporary employment and payrolling are currently the same and fall under a 'temporary employment contract' in accordance with Article 7:690 of the Dutch Civil Code.
With the entry into force of the WAB, this will change and a distinction will be made between the temporary employment contract and the payroll contract. A special variant is added to the agency work employment contract, namely the payroll contract:
“A temporary employment contract, whereby the contract for services between employer and client has not been concluded in the context of bringing together supply and demand on the labor market and in which the employer is only authorized to make the employee available to another person with the permission of the client. to set.”
Payrolling only applies if both conditions are met:
- The employer has not performed allocative activities such as recruitment, selection or mediation.
- The labor force is made available exclusively to one client.
Payrolling a broad concept?
The definition of payrolling is very broad, because it is based on the actions of the employer and not of the client. Due to this broad definition, services that are normally regarded as temporary employment can be regarded as payrolling. For example, when placing benefit claimants from the UWV's question box.
Payrolling may also apply to the collegial outsourcing of an employee of your organization (hiring or on-lending). The rules for payrolling also apply to intra-group temporary employment, ie when employees are exchanged within companies belonging to the same group. If you have several companies or BVs, it is wise to check whether you as an employer fall under the new legislation regarding payrolling for your employees.
Employment conditions and legal position of payroll employee
With the entry into force of the WAB, payroll employees will receive exactly the same terms and conditions of employment as employees who are employed by the client. This applies not only to wages, but also to, for example, vacation days, training schemes and wages in the event of illness, but also year-end bonuses and profit schemes. Payroll employees are also entitled to an adequate pension. It is not yet entirely clear what this means. It has been established, however, that the new pension rules will come into effect one year later than the WAB, i.e. 1 January 2021.
For example, the legal position of payroll employees is subject to the chain scheme that applies to you as a hirer. This will usually mean that the payroll employees will soon be entitled to a permanent contract with your company after (a maximum of) three temporary contracts or after three years. Read more about the chain scheme .
Questions about the payroll?
Do you have any questions about the new legislation on payrolling or other legislative changes in the WAB? Please contact one of our branches in your area.