The Netherlands: 2025, Looking Ahead
Author: Lisa Smit
In 2025, the following employment law matters will change:
- End of Enforcement Moratorium Dutch Tax Authority
- Contribution to unemployment insurance
- Indexations
- Registration of carbon emissions
- Legislative proposal clarification of assessment of employment relationships and legal presumption
1. End of Enforcement Moratorium Dutch Tax Authority
As of 1 January 2025, the so-called enforcement moratorium will be terminated. The Tax Authority will actively enforce compliance regarding pseudo-self-employment and impose retroactive correction obligations, additional assessments, and penalties. The Tax Authority has published the “Guidance on Assessing Employment Relationships,” which outlines the facts and circumstances relevant to determining the nature of the working relationship between principal and contractor. These criteria are based on the Deliveroo judgment. The guidance also explains how to interpret these facts and circumstances: when they indicate employment (and thus an employment contract) and when they point to independent contractor status.
A one-year transition period will apply during which the Tax Authority will not impose penalties for deliberate non-compliance, provided that the client can demonstrate efforts to address false self-employment. The Tax Authority may only enforce retroactive corrections up to January 1, 2025 (the date the enforcement moratorium is lifted). For the period before 1 January 2025, retroactive corrections can only be imposed in cases of intentional misconduct or failure to comply with previously issued instructions within the five-year statutory limitation period.
2. Contribution to unemployment insurance
Differentiated contributions to unemployment insurance (WW) indicate that employers pay a lower premium for permanent contracts and a higher premium for flexible contracts. Starting 1 January 2025, the costs of overtime under the WW premium for large permanent contracts will be reduced. To provide employers with flexibility, employees may work up to 30% additional hours beyond their contracted hours. However, if an employee works more than 30% additional hours on average over the contracted hours, the higher WW rate will retroactively apply for the entire year. “Larger” employment contracts, where an employee works an average of 35 hours or more per week, are exempt from this rule. As of 1 January 2025, this exemption will be expanded to include contracts of an average of 30 hours per week.
3. Indexations
Increase in Maximum Transition Compensation
As of 1 January 2025, the maximum transition compensation (the statutory severance payment) will increase. This maximum amount is adjusted annually in line with the development of contractual wages. In 2024, the maximum compensation was EUR 94,000.- and will be increased in 2025 to EUR 98,000.-.
Standards for Remuneration Act
With the general remuneration cap, specific remuneration categories with reduced limits have been established for various sectors. This cap is adjusted annually in line with wage developments in the public sector during the preceding year. For 2025, the general remuneration cap has been set at EUR 246,000.-. The reduced limits for 2025 in education, the cultural and media sectors, housing corporations, healthcare, and the development aid sector were published in November. For health insurers, specific higher caps apply in comparison to the general limit.
Increase of minimum hourly wage
Every six months (On 1 January and 1 July), the statutory minimum wage is indexed. Since 1 January 2024, the minimum wage is calculated on an hourly basis. As a result, there is now a single fixed minimum hourly wage for all employees aged 21 and older. The indexation for January 1, 2025, has been set at 2.75%, increasing the minimum hourly wage from EUR 13.68 to EUR 14.06. The next minimum wage adjustment will take place on 1 July 2025.
Increase of remote work allowance
The maximum tax-free allowance for remote work will increase by 2.13%, from EUR 2.35 to EUR 2.40 net per day in 2025. If a higher allowance is provided for remote work, income tax and social security contributions must be withheld on the portion exceeding EUR 2.40.
4. Registration of carbon emissions
Employers are required to comply with reporting obligations on CO2 emissions related to employee mobility, encompassing both commuting and business travel. The submission of 2024 data to the Netherlands Enterprise Agency must be completed by 30 June 2025, at the latest.
5. Legislative proposal clarification of assessment of employment relationships and legal presumption
This legislative proposal, aimed at reducing false self-employment, tightens the authority criterion within the employment contract framework. Additionally, a legal presumption of an employment contract applies for hourly rates under EUR 32.24. While the Council of State has expressed criticism, the Minister of Social Affairs and Employment has stated that the proposal will be submitted to the House of Representatives in 2025. The intended effective date is 1 January 2026.
