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Flexible contracts, payrolling, secondment

  /    /  Flexible contracts, payrolling, secondment

Flexible contracts, payrolling, secondment

The attorneys of Amsterdam based law firm Penrose specialise in flexible contracts, such as secondment, temporary employment constructions (temp) and payrolling. Our employment lawyers assist employers, employees, secondment and temp agencies in legal aspects such as entering into the right contracts and resolving (employment) disputes. Hereafter, we will discuss a number of relevant topics and frequently asked questions related to these topics.

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Different constructions can be applied to employ employees in a flexible contract. The most common and simple way is the fixed-term employment contract, which prevents the employee from entering permanent employment. However, the employer and employee can only enter into three consecutive temporary contacts without legal consequences. The fourth contract is automatically an open-ended contract. But a temporary contract also automatically becomes a permanent contract if the employee has been in temporary employment for more than 3 years with intermediate positions of no more than 6 months. The rule that the intervals between the various temporary contracts may not exceed 6 months is different in the case of seasonal work in the Netherlands that can only be carried out for 9 months a year. In this case, the interval between temporary contracts may not exceed three months.

These Dutch labour law rules also apply if the same type of work is involved, but with successive employers, for example if the employee was first employed by a secondment agency or temporary employment agency and then receives a temporary contract directly through the employer.

Under Dutch law, employees with a temporary contract are entitled to the same terms of employment as permanent employees. Learn more about terms of employment.

An on-call worker is an employee who only comes to work if the employer calls the employee for work. These are quite commons contracts in the leisure en hospitality sector in the Netherlands. On-call workers usually work on the basis of 0-hour contracts or on the basis of min-max contracts.

Under Dutch law, on-call employees are entitled to a permanent appointment after 12 months. This means that an employer must make a written offer to this effect within one month after the 12th month, whereby the on-call worker is entitled to at least the average number of hours worked per month over the last year.

In payrolling, an employer transfers the administrative and legal side of being a formal employer to a payroll company. The payroller then looks after the personnel and wage administration. Under Dutch law, it also bears the employment and legal risks in relation to the employee. Due to a number of (recent) legislative changes in the Netherlands, in practice there now would be little difference between the position of an “ordinary” employee and the payroll employee; payroll employees have the same legal status as employees directly employed by the employer for which they work.

A temporary employee is an employee who works for a hiring employer through an employment agency. In case of a temporary employment contract, the employee consequently has an employment contract with the temp agency, whereas in practice he works for a company that actually needs and pays for the employee. In principle under Dutch law, the employment agency must treat the hired employee in the same way as the hiring company treats his own employees.

A secondment contract is a special type of employment contract. The lender provides the employee to the principal for the performance of a specific assignment. The employee continues to maintain an employment contract with the secondment company (just as with the temp employee). From a Dutch legal point of view, employment-agency constructions and secondment are to a great extent regarded as one and the same construction, where in the Netherlands generally secondment concerns more highly skilled workers. As a result, organisations that systematically assign employees for third party business can be regarded as employment agencies. As a result, the requirement decision of the Stichting Pensioenfonds voor Personeelsdiensten (StiPP) becomes applicable, with significant pension obligations for the temp or secondment agency.

Our Dutch labour lawyers specialise in flexible contracts, secondment and payrolling. They help you consider and deal with any of your issues and are happy to answer your questions. The contact details of our experts can be found here.

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