A guide through your new employment agreement in the Netherlands

You have been offered a new job in the Netherlands and the employment contract is waiting for your signature. Congratulations! Before you sign, it is important to understand what you are agreeing to. The ACCESS FAQ already refers to the Dutch government’s website for general information on employment. In this blog, we explain a number of elements that you will find in almost every Dutch employment contract, and what to look out for.

Collective labour agreement

Our first advice is to start with checking whether a collective labour agreement (CAO) applies to your employment agreement. Many sectors in the Netherlands have one. A CAO often contains additional or different arrangements on salary, holidays, working hours and salary during sick leave.

Fixed-term or indefinite contract?

In the Netherlands, parties can enter into a fixed term employment agreement or an indefinite term employment agreement. A fixed-term contract ends on a specific date. That date can be a calendar date, or it can be tied to the completion of a specific task or project. An indefinite contract has no end date.

Probation period

An employment contract often contains a probation period. During this period, both you and your employer can terminate the contract immediately, without a valid reason and without observing a notice period.

The maximum length of a probation period depends on the type of contract:

· Fixed-term contract of six months or less: no probation period is allowed.

· Fixed-term contract of more than six months but less than two years: a maximum of one month.

· Fixed-term contract of two years or longer, or an indefinite contract: a maximum of two months.

A probation clause that is longer than permitted, or that is included in a contract where it is not allowed, is null and void. It must also be agreed in writing and must be the same for both parties.

Secondary employment

Many contracts contain a clause about whether you may work for another party alongside your job, for example as a freelancer or in a second job. It is important to note that since 1 August 2022, an employer may no longer simply prohibit this. A restriction is only possible if the employer has an objective justification, such as the health and safety of the employee, the protection of confidential business information or the prevention of conflicts of interest.

Our advice: is to always discuss with your employer that you intend to take on secondary work. Many contracts require you to report this or ask permission first.

Holidays

Your contract states how many holidays you are entitled to. By law, you accrue four times your weekly working hours per year. With a 40-hour working week, that means 20 statutory holidays (wettelijke vakantiedagen). Any days above that are non-statutory holidays (bovenwettelijke vakantiedagen).

The difference matters, because the two types expire at different times. Statutory holidays expire six months after the end of the calendar year in which you accrued them, so on 1 July of the following year. Non-statutory holidays expire five years after the end of the calendar year in which you accrued them.

Salary

Your contract states your gross salary and when it is paid, usually monthly. Besides the amount of salary you will receive, your employment agreement will also include a couple of other relevant elements regarding your salary.

In the Netherlands you are entitled to a holiday allowance of at least 8% of your gross salary. Your contract states whether this is paid monthly or once a year. Most employers pay it once a year, usually in May.

Most employment agreements also include how much salary you will receive during sick leave. By law, your employer must continue to pay at least 70% of your salary for a maximum of two years. Sometime, employers deviate from this. A common arrangement is for example 100% of salary in the first year of illness and 70% in the second year.

Post-contractual clauses

Almost every employment contract contains a confidentiality clause. This obliges you to keep confidential information to yourself, both during and after your employment.

Your contract may also contain a non-solicitation clause, which prohibits you from working for or approaching your employer’s clients after you leave, and/or a non-compete clause, which prohibits you from working for a competitor or starting a competing business. Under current Dutch law there are no statutory requirements regarding the geographical scope or duration of such a clause. It must, however, be agreed in writing.

For a fixed-term contract, an additional requirement applies. A non-compete or non-solicitation clause in a fixed-term contract is only valid if the contract explains in writing why the clause is necessary because of business or service interests. Without this justification, the clause is null and void.

Conclusion

We can imagine that you are excited about your new job and want to sign the contract as soon as possible. That is understandable! But take the time to check your employment contract, and any applicable CAO, before you sign. If you have questions, ask your new employer before signing.

Questions or advice?

If you cannot work it out together, please do not hesitate to contact me or one of the other specialized lawyers at GMW lawyers. We can work it out!

Roos van Zaltbommel specialises in employment law is involved in various matters, including dismissal cases, non-compete clauses, disputes between employers and employees, and the employer’s duty of care.

You can contact her at: r.vanzaltbommel@gmw.nl

For more information about work and employment contracts in The Netherlands, visit Employment contracts – ACCESS NL.