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The Netherlands is one of Europe’s most robust and diverse economies, known for its highly educated, skilled workforce. The country is home to a thriving technology, engineering, and healthcare sector, making it a prime destination for talent across various fields. The Netherlands also boasts a high standard of living, a strong legal framework for employee protection, and a business-friendly environment that attracts international companies.
However, hiring in the Netherlands is subject to a strict set of labor laws and regulations, particularly regarding work permits, employee benefits, and social security contributions. Employers looking to hire in the Netherlands must ensure full compliance with these regulations to avoid penalties and ensure smooth onboarding of new hires.
Facts & Stats
The Netherlands has well-defined labor laws under the Dutch Civil Code and Employment Contracts Act. These laws protect employees' rights regarding working hours, wages, leave, and benefits.
The probation period in the Netherlands typically lasts up to 2 months, and during this time, either the employer or employee can terminate the contract with minimal notice (usually 1-2 weeks). The length of the probationary period is clearly stated in the employment contract. Once the probation period is over, the employee is entitled to all benefits specified in their permanent contract.
Employees are entitled to a statutory minimum of 4 times their weekly working hours as paid annual leave (i.e., 20 days for a 40-hour workweek). This can increase based on company policy or sector-specific agreements. Employers must ensure employees have the right to request leave in advance and that unused leave is carried over when appropriate.
In the Netherlands, the standard workweek is 40 hours, usually spread across 5 days. Overtime is paid at 1.5x the regular hourly rate (150%) for the first 2 hours. Any overtime worked on public holidays or rest days is typically paid at 2x the regular rate (200%).
Employers are required to keep records of overtime hours and ensure that any overtime is tracked properly for compliance with Dutch labor laws.
The minimum wage in the Netherlands is €1,725 per month for employees aged 21 and over (as of 2024). Employers must ensure they meet or exceed this minimum threshold for all employees, regardless of whether they are full-time, part-time, or temporary.
Employer and employee tax breakdown
7.65%
Employees contribute through automatic payroll deductions for Social Security and Medicare.
7.65%
Employers pay a fixed percentage of wages toward Social Security and Medicare.
10%
Individual taxes are applied based on personal income and are calculated as a percentage of earnings.
5%
Employment termination in the Netherlands requires a valid legal ground and must follow strict procedures. Employers usually need approval from the UWV or the court, must observe notice periods, and may be required to pay a statutory transition allowance to the employee.
In the Netherlands, employees are entitled to notice periods based on their length of service. For employees with:
- Less than 1 year of service: 1 month notice.
- 1 to 5 years of service: 2 months notice.
Over 5 years of service: 3 months notice
If an employee is terminated without cause, they are entitled to severance pay, which is typically one month’s salary for each year of service.
The Netherlands observes public holidays such as:
- New Year’s Day (January 1)
- King’s Day (April 27)
- Labor Day (May 1)
- Christmas Day (December 25)
Frequently asked questions
What makes Iris helpful for hiring in the Netherlands?
Iris helps streamline the recruitment process in the Netherlands by offering AI-powered sourcing, candidate screening, and integration with local job boards.
Is it mandatory to hire Dutch nationals?
No, it is not mandatory to hire Dutch nationals. However, non-EU employees may require a work permit.
How is severance pay calculated in the Netherlands?
Severance pay is typically one month’s salary for each year of employment if the employee is dismissed without cause.
Do employees in the Netherlands receive a pension?
Yes, employees are typically entitled to a company pension plan, which may be mandatory under sectoral collective agreements.
What’s the official work week in the Netherlands?
The standard workweek in the Netherlands is 40 hours, usually spread across 5 days. Overtime is compensated accordingly.
