Better working conditions for posted EU workers

Does your company work with posted workers from an EEA member state or Switzerland? The proposed legislative changes will provide greater protection for posted workers as of July 30, 2020. For both service providers and service recipients, it is therefore important to be aware of the rights of posted workers, the obligations in the case of posted workers and the penalties when obligations are not met.

The Review Directive

The Revision Directive is an adaptation of the Posting of Workers Directive with the aim of striking a better balance between promoting the freedom to provide services and creating a level playing field for companies on the one hand, and protecting the rights of posted workers on the other. Under the 1996 Posting of Workers Directive, posted workers are already entitled to a number of Dutch terms and conditions of employment. The Posting of Workers Directive is included in the Law on Working Conditions for Posted Workers in the European Union (WagwEU). This directive is extended by the revision directive.

Who does the WagwEU apply to?

Employers from other EU countries who temporarily come to the Netherlands with staff to do a job (secondment) are covered by the WagwEU. The WagwEU distinguishes between service providers, self-employed persons and service recipients.

You are a service provider if you are a foreign employer temporarily:

• under your direction and supervision and on your behalf with personnel comes to perform a job in another member state. This will often involve a contract of assignment or contract for work between you as service provider and service recipient. For example, consider a German company that comes to build a bridge on behalf of a Dutch service recipient;
• posting of employees within multinational groups. Posting can also take place by posting an employee from an establishment of a group in one member state to an establishment of the same group in another member state;
• Provides temporary workers to work temporarily in the Netherlands, and;.
• self-employed persons are considered to be service providers if they are established abroad and temporarily come to perform work in the Netherlands and fall into one of the risk sectors to which no exception applies. These risk sectors include agriculture, construction, hospitality and health and welfare.

The service recipient is the person for whom the service provider goes to work in the Netherlands and with whom he has an agreement, also known as the client.

Under the WagwEU, the service provider has a duty to provide information, a duty to keep records, and a duty to designate a contact person. As of March 1, 2020, an obligation to report has also been added. Reporting can be done through the online reporting desk at www.postedworkers.nl.
In this way, the WagwEU enables better control of companies that fall under this law. These companies can be fined by the Insprectie SZW if they fail to comply with Dutch labor laws.

What will change as of July 30, 2020?

The premise of the changes effective July 30 is equal pay for the same work in the same place. Giving workers protection reduces differences in terms and conditions of employment to which posted workers are entitled, compared to the terms and conditions of employment of national workers. This encourages the free provision of services in the EU and creates a level playing field for businesses.

The measures from the revised Posting of Workers Directive will be implemented in the Netherlands as follows:

• The terms and conditions of employment that service providers must guarantee at least for their posted workers are expanded to include housing conditions and certain allowances and benefits;
• if a posting exceeds 12 months, which period may be extended to 18 months under circumstances, additional terms and conditions of employment apply to the posted worker;
• it has been proposed to include in the Wet allocatie arbeidskrachten door intermediairs (Waadi) that the posted temporary worker at a Dutch hirer is entitled to at least the same terms and conditions of employment as local temporary workers. This also applies to all generally binding conditions from an applicable collective bargaining agreement. Excluded are the provisions on procedures, formalities and conditions of conclusion and termination of the employment contract and on supplementary company pension schemes;
• it has been proposed to include in the WagwEU an article stipulating that the same terms and conditions of employment of the last hirer in a chain shall also apply to the posted temporary worker. This entails that the first hirer in the chain has the obligation to inform the temporary employment agency of a possible onward assignment to a second hirer within reasonable periods of time before starting work. The temporary employment agency is then given a timely opportunity to declare the correct terms and conditions of employment applicable. This is because the temporary employment agency remains responsible for the actual payment to the posted temporary worker;
• The Minimum Wage and Minimum Holiday Allowance Act and the Act on Declaring Provisions of Collective Bargaining Agreements Universally Binding and Unbinding will provide that necessary costs incurred in the context of the posting, such as travel, meals and accommodation costs will not be included in the minimum wage but must be reimbursed separately to the posted worker.

Entry into force

The Revised Posting of Workers Directive will take effect July 30, 2020, for all sectors except the road transport sector. The road transport sector to which the Revised Directive temporarily does not apply includes both goods and passenger road transport. The other sectors of the transport sector are not exempted from the revision directive.

Would you like to know more about working with posted workers from the EU? If so, please contact one of our specialists.