As a consequence of the Posting of Workers Directive and the Terms of Employment Posted Workers in the EU Act (WagwEU), with effect from 1st March 2020, employers from countries in the EEA and/or Switzerland who post employees to the Netherlands on a temporary basis are required to register those employees before they start working in the Netherlands.
Which Employers Have to Register?
Employers from the EEA and Switzerland who come to the Netherlands with their own employees (or provide their employees work in the Netherlands under a hire of labour arrangement), multinational companies that second employees to their own group companies in the Netherlands and agencies that second temporary workers to the Netherlands.
Self-employed workers who work in “high risk” sectors (agriculture, forestry and fishing industries, manufacturing, construction, accommodation and food service activities, renting, leasing and business support services, human health and social work activities, transport and storage) are also required to register before they start working in the Netherlands.
The UK will still be treated as an EEA state for the purposes of this new registration until at least 31 December 2020, during the post-Brexit transitional period.
What are the Exceptions to the Registration Requirement?
The registration is only applicable in case of a posting on a temporary basis. The Dutch legislation does not define “temporary” but states that it means that the employee “usually works in another member state”. Based on current guidance and Dutch case law, a posting for up to 1 year can be considered as temporary and periods over this will be considered on a case by case basis.
Small companies (1 to 9 employees) and companies within 100 kilometres of the Dutch border will be able to do an annual registration if they meet certain requirements. Employees undertaking urgent repairs or maintenance, visiting academic conferences, attending business meetings etc. are, under certain conditions, exempt from the registration obligation. In addition, the registration requirement is not applicable to Merchant Navy seafaring staff and merchant companies.
What does the Employer need to do?
Employers should register their employees before starting work in the Netherlands, by using the notification portal (www.postedworkers.nl). As well as providing information on the Company, the employer will need to provide information on the contract, employees, the end client and whether an A1 Certificate is in place to retain both employee and employer within their home country social security system.
The employer must be able to provide various documents for inspection, if requested, and foreign employers are required to offer their employees in the Netherlands at least the basic terms of employment regulated by the Dutch employment law.
What if the employer does not Comply with the Registration Requirements?
If the requirement to register is not observed by the employer or if incorrect information is provided, significant fines of EUR12,000 may be imposed. Fines may also be imposed if the necessary documents are not made available in the workplace or if the basic terms of employment regulated by the Dutch employment law are not met.
If you require any further information on this or require support with the registration requirements, please contact Catriona Ross, Payroll & Employment Taxes Assistant Manager or your usual AAB contact.
For more information on the AAB Payroll & Employment Taxes team, click here.