The Netherlands is well-known for its strong employee protections, generous benefits, and a cultural commitment to work-life balance.
With an unemployment rate far below the European Union average (3.5% vs. 6.1%) and a 4.5% job vacancy rate, hiring in the Netherlands is highly competitive, especially for skilled roles.
To stand out as an employer of choice in this low-unemployment, high-skill market, offering only the minimum statutory benefits isn’t enough.
Employers must go further: offering attractive supplementary perks, flexibility, and meaningful work-life balance to win over qualified candidates.
Key takeaways:
- Both full and part-time Dutch employees are entitled to various statutory benefits.
- Employers in many sectors must comply with collective labor agreements and offer additional benefits.
- Businesses frequently offer supplementary benefits to build competitive compensation packages that attract top talent.
Who Is Entitled to Benefits in the Netherlands?
Both full- and part-time employees are guaranteed statutory benefits, like access to paid leave.
Employers in many industries operate under Collective Labor Agreements, or Collectieve Arbeidsovereenkomst (CAO). CAOs are negotiated between employers and trade unions and can mandate enhanced benefits, like additional paid leave or enhanced pension contributions. They’re common in the public sector, transportation, manufacturing, construction, and other industries with large or unionized workforces.
Even companies not bound by CAOs will typically offer additional supplemental benefits to attract and retain highly skilled workers in the competitive hiring market.
On the other hand, independent contractors or “zelfstandigen/ZZP'ers” are not entitled to statutory benefits.
Employers must ensure they are appropriately classifying independent contractors, and treating them like contractors (NOT full-time employees), or they risk worker misclassification penalties and legal issues, plus owing back pay for taxes, Social Security, and retroactive benefits.
Minimum Wage & Overtime Pay
As of July 2025, the minimum wage in the Netherlands is EUR 14.40 for employees 21 and older, and the typical full-time work week is between 36 and 40 hours.
The Working Hours Act, or “Arbeidstijdenwet,” stipulates that employees 18 and older can work a maximum of 60 hours per week, but not every week. Employees must also receive a weekly rest period of 36 consecutive hours.
There are exceptions to these limits, for example: the working hours may differ based on the terms of a CAO or can be adjusted temporarily to support seasonal work or emergency situations.
Overtime pay is not legally stipulated in Dutch employment law; it’s typically specified in the CAO or employment contracts. Many employers offer overtime rates at 50% or 100% of regular pay or offer additional time off.
Dutch employees also receive “Vakantiegeld,” a legally mandated holiday allowance equal to 8% of their annual salary, designed to give them extra spending money for vacations or summer holidays.
In addition, many employees also receive a 13-month salary, an end-of-year bonus equal to one month’s gross wages. Not all employers offer the 13-month salary, but it is frequently included in employees' CAOs.
Flexible Working Act
To support work-life balance, the Netherlands passed the Flexible Working Act or “Wet Flexibel Werken.”
Under the Flexible Working Act, employees who have been with a company for at least six months have the right to request adjustments to their work arrangements, such as reducing their hours, changing their schedule, or working remotely or from a different location.
Employers are legally required to consider this request and respond in writing. They can only deny the new working conditions if they have a strong and objective business reason.
Social Security Contributions
In the Netherlands, mandatory Social Security contributions — paid by both employers and employees — fund benefits like pensions, maternity leave, and healthcare.
- The national insurance schemes or “volksverzekeringen” supports the General Old Age Pensions Act, Surviving Dependents’ Pension, Long-Term Care Act, and Child Support.
- The employee insurance schemes or “werknemersverzekeringen” funds the Unemployment Insurance Act, the Work and Income (Capacity for Work) Act, and the Sickness Benefits Act.
Typically, employers contribute 17-25% of an employee’s gross salary to fund programs like:
- Health insurance (Zvw): 6.51%
- Unemployment insurance (WW): 7.74% (high end) and 2.74% (low end)
- Disability insurance: 7.64% or 6.28% for a small company
Pension Plans
Dutch pension plans ensure employees have a stable income after retirement.
In the Netherlands, there are multiple pension options:
- General Old Age Pensions Act (AOW): A state pension for all Dutch residents, with accrual amounts based on the years an employee lived in the Netherlands before their retirement age and their living situation. AOW is funded through employee national insurance contributions, withheld via income tax.
- Surviving Dependents’ Pension (ANW): The ANW insures all residents for a surviving dependents’ pension.
- Workplace Pensions (Occupational Pension Plans): Workplace pensions in the Netherlands are mandatory when an industry-wide pension fund applies, which is typically outlined in a CAO. However, businesses not governed by a CAO can still choose to offer a pension plan.
- Private pensions: These voluntary retirement savings plans are used by self-employed workers or employees who want to supplement their state and workplace pensions.
Employers often cover a large portion of workplace pension contributions, typically ranging from 15–25% of the pensionable salary. These contributions are usually tax-deductible, with a cap set at 30%.
Health Insurance
Basic health insurance is mandatory in the Netherlands, and Dutch workers are required to purchase private insurance. Employers contribute toward the cost up to a set maximum, and employees cover the remaining balance.
Some Dutch employers choose to offer additional group/private insurance or may further subsidize healthcare premiums to better support and attract employees.
Psst: we know navigating international health insurance requirements can be challenging. With RemoHealth and RemoHealth Local, we enable businesses to offer international private medical insurance or personalized local health benefits to their global employees, including in the Netherlands.
Unemployment Insurance
In the Netherlands, the Unemployment Insurance Act, or “Werkloosheidswet (WW),” provides benefits for employees who lose their jobs.
Unemployed workers in the Netherlands receive monthly benefits equal to 75% of their previous salary (up to a capped amount) for each year they were employed, up to 10 years. If they’ve worked longer than that, the benefit amount drops to half a month's pay for each additional year, with a maximum total benefit period of two years.
Workers’ Compensation Insurance
There isn't a traditional workers' compensation insurance system in the Netherlands.
Instead, employees receive coverage and protections through Social Security and employer contributions.
However, the Work and Income (Capacity for Work) Act (WIA) supports employees who, after 104 weeks of illness, have lost 35% of their wages.
Compensation intended to supplement lost income varies based on the severity of disability and whether the person can continue to work in a decreased capacity.
Leave Entitlements
Work-life balance is highly encouraged in the Netherlands and supported by multiple leave schemes.
Annual Leave and Holiday Leave
Employees are entitled to at least four times their weekly working hours in paid leave annually, typically 20 days for full-time staff and pro-rated for part-time employees.
Many employers offer additional PTO or vacation days to make their benefits offering more competitive.
Additionally, there are 11 public holidays in the Netherlands. Although employers are not required to grant these days off, many businesses opt to.
Dutch public holidays include:
- New Year’s Day
- Good Friday
- Easter Sunday
- Easter Monday
- King’s Day
- Liberation Day
- Ascension Day
- Pentecost
- Whit Monday
- Christmas Day
- St. Stephen’s Day
Parental Leave
The Working Hours Act ensures pregnant employees get paid leave for pregnancy checkups during working hours.
Pregnant employees receive six weeks of pregnancy leave before their due date. Following childbirth, employees are entitled to at least 10 weeks of maternity leave, with a minimum of six weeks, which must be taken immediately after the baby is born. The remainder can be taken any time, up to 30 weeks post-birth.
Employers continue to pay their employees’ salaries during leave and are reimbursed by the Employee Insurance Agency, or “Uitvoeringsinstituut Werknemersverzekeringen” (UWV).
Dutch employees are entitled to one week of paid partner leave after childbirth, which can be taken within the first four weeks. This leave is paid in full by the employer.
Additionally, the Netherlands offers employees 26 weeks of parental leave (including step-parents, foster parents, and adoptive parents).
The first nine weeks are paid at 70% of the daily wage by UWV, but only if taken in the first year after the child’s birth. The remaining 17 weeks are unpaid and can be taken until the child turns eight.
Sick Leave
Sick employees receive at least 70% of their salary for the first two years that they’re out of work due to illness. At that point, the employer is no longer obligated to pay any benefits.
The Sickness Benefits Act (ZW) provides income for employees who are no longer employed and unable to work due to illness. These benefits typically cover about 70% of the employee’s former salary and can be paid for up to 104 weeks.
Supplementary Benefits to Sweeten Your Hiring Offer
Many employers choose to offer additional perks on top of statutory benefits to attract high-quality talent.
Examples of supplementary benefits include:
- 13-month salary: An end-of-the-year bonus equal to a month’s gross wage
- Travel expenses: Reimburses public or personal transportation costs or provides employees with a company car
- Work-from-home stipend: Funds for employees to set up their home office or offset rising costs of living
- Work-related costs: Allowances for work expenses, like WiFi, office equipment, education, or training
- Paid leave: Additional paid leave or even unlimited time off
Hire and Offer Benefits in the Netherlands with RemoFirst
If windmills and stroopwafels are calling your name — or, more seriously — you’re ready to tap into the skilled workforce in the Netherlands, RemoFirst is here to help.
As an Employer of Record, we’ll help you navigate complicated statutory entitlements, collective labor agreements, and evolving employment laws.
With our expert team and comprehensive platform, we’ll ensure your business is compliant with all local regulations, from Social Security contributions to legally mandated leave and pension requirements.
Even better? With RemoHealth and RemoHealth Local, you can provide top-tier health insurance options to attract and retain high-quality candidates in any country.
Ready to build a competitive and compliant global team? Schedule a demo with RemoFirst today.
