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Labour law & Social Policy in the Netherlands
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Labour law & Social Policy in the NetherlandsSamenvatting Syllabus ‘Labour law & social securtiy in The Netherlands’
§ 1 Introduction
In response to the social turmoil in Europe at the end of World War I the Dutch government initially
intensified its social programme.
In the period following the Second World War the government maintained tight control on wages and
prices until far in the 1960’s.
It is due to a long history of centralised wage control policy that the prictice of institutionalised
consultation and co-operation at all industry level is wel developed, the so-called Poldermodel.
During the economic recession of the 1980’s the Netherlands had difficulties in maintaining its labour
laws and social security laws that had pushed labour costs to ever higher levels. Large sections of the
population failed to find word and remained unemployed for many years.
Since then labour law and social security law has gone through a period of reconstruction. Almost all
the old statutes have been revised to make them more flexible and less costly.
Sources of law
Labour law and social security law, as set out in formal Dutch legislation, is almost completely framed
at the national level, to the almost total exclusion of subordinate authorities such as provinces and
municipalities.
Often Duch Acts of Parliament – also in matters of labour law and social security – only give basic
regulatiory principles, leaving its concretisation to Royal Orders, Ministerial Decrees, Ministerial
Circulars etc.
The most important instrument governing working conditions, after the law, is the collective
agreement.
In the Netherlands the hierarchy of sources of labour law follows general principles, which apply under
civil and public law.
Statutes have priority over contracts, treaties (provided they are directly applicable) over statues;
collective agreements have priority over individual contracts.
Yet in labour law this hierarchy of sources is often, but not always, overturned by the ‘principle of the
most favourable law’: i.e. the idea that the regulations contained in a lower souce of law may derogate
from the regulations contained in a higher source if this is favourable to employees.
Also very characteristic for Duch labour law is the prominent role played by the courts. The rights of
Dutch employees have been strongly enshrined in law; the courts may deal in full with labour law
disputes without being subject to any restrictions; the existence of the summary proceedings and of
subsidized legal aid have greatly facilitated employees’ access to the courts; unions may also take
action in the courts in the event of disputes relating to the interpretation of a collective agreement.
The higer profile of Dutch judges in labour law is all the more remarkable concerning the fact, that the
Nederlands – in contrast to most EU Member States – does not have specialised labour courts.
Since the 1960’s, the Netherlands has ratified an increasing number of international treaties, which
contain fundamental ‘social’ rights.
§ 2 Conditions of Employment
The contract of employment
Since 1909 the Duch Civil Code (CC) contains an entire chapter with about 100 sections to regulate
various terms of the contract of employment.
The provisions of the Civil Code on contracts of employment are applicable to all employees
irrespective of income, function or the sector of industry where they work.
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, As the provisions of the Civil Code on the contract of employment are only applicable if the contract is
a genuine contract of employment, the definition of the contract of employment under civil law is very
important.
The Dutch Civil Code in Art. 7:610 states that a contract of employment is an agreement under which
one party, the employee, undertakes to perform work in a relationship of subordination to the other
party, the employer, for a certain perion in return for remuneration. The notion ‘subordination’ is the
distinctive criterion defining the contract of employment in relation to the other agreements for the
performance of labour.
The uncertainly as to whether a contract is to be regarded as a contract of employment appeared to
be especially detrimental to workers in atypical employment relationships, such as freelances, labour
on call, temporary agency workers, etc. For this reason in 1999 a new provision was inserted in the
Dutch Civil Code, which provides taht any person who for the benefit of another person performs work
for remuneration by that other person for three consecutive months weekly of for no fewer than 20
hours per month is persumed to perform such work persuant to a contract of employment (Art.
7:610(a)
A contract of apprenticeship is one under which a master agrees to teach and instruct an apprentice in
the workshop. When the apprentice produces ‘productive work’ during his training, the contract of
apprenticeship is also a contract of employment.
High level employees sometimes for fiscal reasons have their own limited company and in this formula
they serve other companies management agreements
Since the mid-1980’s employers have increasingly made use of flexible labour contracts as this
enables them to easily reduce the work force when economic reasons so require. The most common
forms of such flexible contracts are the fixed-term contracts, the labour-on-call contracts, the contracts
of temporary agency workers, free lance contracts, contracts of franchising and contracts with
independent workers.
Fixed-term contracts normally end automatically on the expiry of the period agreed upon (7:667).
Only after either the third renewal (i.e. upon the fourth contract) or beyond three years will the renewed
fixed-term contract automatically become open-ended (7:668a)
Labour on call contracts are characterised by the fact the exact numbers of working hours is not
specified. The workers are when work is available.
The work for temporary work agencies created a triangular employment relationship. The relation
between the temporary worker and the agency is explicity called a contract of employment (7:690).
Following developments in international law and building on the traditional tolerance and pluralism of
the Ducht society, the Netherlands has in recent years seen a vast growth in anti-discrimination
legislation.
Most of this legislation not only forbids direct discrimination, bus also indirect discrimination, unless the
latter can be justified on reasonable and objective grounds.
The Dutch Civil Code contains a number of provisions protecting the wages due to the employees
(7:616 and further).
On the determination of wages the Civil Code has only a marginal impact. It protects the effective
payment of the agreed wage, but it does not lay down rules as to the amount of the wage to be paid.
The Civil Code entitles an employee to at least four weeks paid holidays and contains a number of
provisions (7:634 – 645), which specify this right (for example o the accumulation of rights on holidays
with pay during periods of illness).
The Minimum Wage and Minimum Holiday Allowances Act 1968 obliges all employers to pay their
employees a yearly holiday allowance of at least 8 per cent of the yearly wage (to a maximum of three
times the minimum wage).
Both sets of statutory rules have a minimum character.
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