On November 18, 2016, the Deputy Minister of Finance, Mr. Wiebes, informed the Lower House in his Second DBA Progress Report that there is unrest and uncertainty about the Assessment of Employment Relationships Deregulation Act (Wet deregulering beoordeling arbeidsrelaties; hereinafter: DBA), which should be eliminated as quickly as possible.

How will the Deputy Minister eliminate the uncertainty?

The implementation period is extended from May 1, 2017 to January 1, 2018. This means that enforcement of the DBA has been postponed until January 1, 2018 in order to resolve the problems. The legislation will however be enforced in cases of evident malice.

What further action will the Deputy Minister take?

  • The definitions of ‘free substitution’ and ‘relationship of authority’ will be reassessed in the coming period. While these definitions are being reviewed, but in any case until January 1, 2018, the tax authorities will not take enforcement action and no penalties or supplemental assessments will be imposed. The tax authorities have a coaching role in this respect.
  • The distinction between ‘entrepreneurship’ and ‘employment relationship’ will also be examined to see how it can better reflect practical experience.
  • With effect from May 1, 2017, repressive enforcement action will be taken by the tax authorities against ‘malicious parties’.
  • The model agreements will be developed further. A policy statement and an ‘information leaflet’ for the general model agreements will be produced in order to clarify the situations where such agreements can be applied.
  • The Minister of Social Affairs is open to requests to expand the provisions in the Work and Security Act relating to the way in which collective labor agreements in the various sectors count consecutive periods when establishing whether there is successive employment. The broadcasting industry, media and the arts and culture sector were referred to in this context.

What does this mean in practice?

With his letter to the Lower House, the Deputy Minister has acknowledged that the DBA has unintended consequences for the labor market. His concession extends the implementation period. This certainly does not mean that the DBA has been made inoperative; there is merely a longer familiarization period. For principals it is therefore still important to reach an agreement with contractors that is in conformity with the rules of the DBA.

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