News item | 06-10-2023 | 18:06
The rules for working with employees and self-employed persons are clarified. This allows workers and employers to know more quickly whether a job can be done by a self-employed person or by an employee. What is new is that indications that point to self-employment will also be given considerable weight in the assessment of an employment relationship.
Minister Van Gennip of Social Affairs and Employment has put the bill out for internet consultation today. This proposal is one of the measures with which the government wants to combat false self-employment and offer more space to entrepreneurs.
Minister Van Gennip: ‘We have examined and clarified the case law and created an assessment framework. Simply put, this means: 1. How are you managed and controlled? Do you have complete freedom in this or are you under the guidance of someone else? 2. Do you do work that is structurally done in an organization? Has a permanent place in the organization? And do you do the same work as and with employees? 3. Or do you work independently, at your own expense and risk? With this clarification, employers and self-employed people will soon be able to do better. Without having to sift through a mountain of case law for assignments.’
Many self-employed people consciously choose entrepreneurship. They therefore make an important contribution to the economy. At the same time, there is also a downside to the rapid growth in the number of self-employed people. In some cases there is (forced) false self-employment. Or unfair competition on employment conditions between workers and between employers. There are also macroeconomic concerns. If large groups of workers who are in fact employees do not contribute to employee insurance (such as unemployment insurance), its reach decreases and it may become more difficult to provide sufficient protection to vulnerable workers.
In the spring, the government made a broad package of agreements with employers’ and employees’ organizations for a future-proof labor market, including the staff retention crisis scheme and the regulation of flexible work. This has now also been discussed with the House of Representatives. Part of the package is restoring the balance in working with and as a self-employed person(s).
The cabinet is working along three parallel lines. Steps have now been taken on all three lines. The bill that is being consulted today is part of the second line:
- Creating a more level playing field for contract types for employees and self-employed persons.
- Clarifying the rules about when one works as an employee and when one can work as a self-employed person.
- Strengthening and improving enforcement and in preparation for the abolition of the enforcement moratorium as of January 1, 2025.
Clarify legislation
In the regulations, the way in which the work is carried out (the totality of facts and circumstances) determines whether work may be done by a self-employed person or by an employee. In many cases, the current legislation is clear. And is someone clearly an employee, or can perform a job as a self-employed person. But for a smaller portion of the assignments it is more difficult to determine how work should be done. This gray area is partly due to the openly formulated legislation. This open legislation has been further supplemented over the years by case law (court rulings) and in some cases provides a large number of relevant facts and circumstances that may be important for the outcome. We have also started working differently in our modern labor market, for example by working from home, or because people work via an app. For example, does someone have complete freedom or does an algorithm determine the rates and how quickly something must be finished?
The cabinet has therefore decided to clarify the legislation on ‘working in the service of’. For this purpose, the case law has been brought together and summarized in an assessment framework (page 49 of the Explanatory Memorandum). This makes everything clearer and easier to handle. Companies that want to hire someone and workers can then focus on that assessment framework. These main elements and associated indications not only indicate when there is an employee status, but also include indications of ‘own account and risk’, indications of independence. This gives self-employed people tools to shape their work within the rules where possible. Nine example cases can be found in the Explanatory Memorandum (from page 50).
More security at the basis of the labor market faster
In addition, the cabinet wants a legal presumption based on an hourly rate. This legal presumption makes it easier for workers at the bottom of the labor market to claim an employment contract from the employer and, if necessary, from the court. If the worker appeals to the legal presumption and makes it plausible that he is paid less than the applicable hourly rate (currently 32 euros), it is then up to the employer to demonstrate that there is no employment contract. The government expects this to have a preventive effect. So that when an employment relationship is entered into, a more critical assessment is made of whether there must be an employment contract or whether the work can be done by a self-employed person.