Rogue businesses can use secondment to circumvent the employment conditions and laws of the country where the activities are performed. In order to lay down and respect the rights related to the employment conditions of seconded employees, European directives have been drawn up. The new bill on the Employment Conditions of Seconded Employees in the European Union Act is intended to implement the European Enforcement Directive into Dutch law, which will make it easier to implement and enforce the Secondment Directive. The Act is expected to take effect in mid-2016.

The bill in summary

The bill contains:

  • a notification obligation for cross-border services in the Netherlands;
  • measures to provide, upon request, personal details during the period of secondment in the Netherlands;
  • measures to provide, upon request, personal details to organizations representing the parties to collective labor agreements that are responsible for monitoring the compliance with collective labor agreements;
  • measures which improve the access that service providers and seconded employees have to information about obligations;
  • measures which enable information to be exchanged with other Member States;
  • measures which provide for the cross-border collection of fines.

The notification obligation

The bill contains a notification obligation for foreign businesses wishing to provide services in the Netherlands. The introduction of this obligation means that the Inspectorate SZW can monitor whether EU employees get the minimum employment conditions to which they are entitled and, as such, whether the foreign businesses comply with the European Secondment Directive. The notification obligation also applies to self-employed individuals who come to the Netherlands to perform a service in certain, still to be designated risk sectors. In so doing, the Netherlands is following other Member States that also have a notification obligation. The measures in the bill also have implications for the recipient of the services. The bill requires the recipient of the services to review, no later than at the commencement of the activities, whether a notification has been submitted and, if so, to verify whether the individuals who are going to perform the work are the same individuals listed in the notification

Impact: improved oversight of European service providers

If the bill is approved, the Netherlands will improve its oversight of European service providers that are active in the Netherlands. The bill provides for the enforcement of rules related to employment conditions, but in doing so it has made it even more important to establish, in advance, other obligations (for example, the corporate income tax obligation, the withholding obligation for payroll tax and social security contributions and the VAT obligation).