Netherlands: The Entrepreneurship Requirement Carries Less Weight Regarding False Self-employment

The issue of false self-employment in the Netherlands remains a key topic following the Supreme Court’s Deliveroo judgement, which outlines nine criteria for determining employment status. While the Court emphasised assessing all criteria together, the Tax Authority focuses primarily on the first eight. Starting 1 January 2025, stricter enforcement may lead to contract reclassification, requiring employers to compensate workers and the Tax Authority. Meanwhile, a draft law aims to clarify employment relationships, though its future remains uncertain. How the authorities will interpret and implement these changes in practice remains to be seen.

In the L&E Tracker, we have previously reported on the issue of false self-employment in the Netherlands. The problem mainly arises in certain situations where it is unclear whether a worker is entitled to an employment contract or is operating under a freelance agreement. The Dutch Supreme Court decided in the Deliveroo judgement that nine criteria are relevant in determining whether an individual is working under an employment contract or as a self-employed person. However, the Tax Authority primarily considers only the first eight criteria; the ninth criterion pertains to whether a person generally behaves as an entrepreneur.

Deliveroo Criteria

When assessing whether an employment contract exists, all relevant circumstances must be considered in conjunction. In the Deliveroo judgement, the Supreme Court outlined nine key factors that may indicate the existence of an employment relationship. These criteria generally relate to the nature of the work, the way the worker conducts himself within the assignment, and the extent to which they can operate as an entrepreneur.

The Tax Authority

In the Deliveroo judgement, the Supreme Court explicitly stated that all criteria must be assessed in relation to each other. Nonetheless, it is remarkable that the Tax Authority, as the enforcer of the tax system, has chosen to base its enforcement policy on this opinion, despite the preliminary questions remaining unanswered. Additionally, as of 1 January 2025, the Tax Authority enforced regulations on false self-employment more strictly. As a result, employers may be required to compensate both their workers and the Tax Authority due to the reclassification of contracts they have used until now.

At the same time, the approach of the Tax Authority aligns with a draft legislative proposal aimed at clarifying employment relationships. However, whether this proposal will be approved in its current form remains uncertain, as it has been met with significant criticism.

In the coming period, it will become clear how the Tax Authority, the legislature, and the judiciary will handle the Deliveroo judgement and the opinion of the Advocate General.