Important Netherlands Employment Law Changes Effective 1 January 2026: What Employers Using EOR Services Need to Know

Starting 1 January 2026, significant changes to employment law in the Netherlands will take effect. These updates influence payroll practices, worker classification, minimum wages, pension rules, and benefits administration. For foreign companies hiring or managing talent through a Netherlands Employer of Record (EOR), these changes affect compliance risk, total employment cost, and HR processes. Below is a practical overview of what is changing, the current arrangements, and what it means for employers.

False Self‑Employment Enforcement (Soft Landing Extended)

What is Changing

The Dutch Tax Authority enforces rules about whether a person is genuinely self‑employed or is effectively working as an employee. The government has decided to partially extend the soft landing approach through 1 January 2027.

Current and Continuing Arrangement

Tax authorities will generally begin enforcement with company visits rather than immediate penalties, although fines can still be imposed for intentional wrongdoing or gross negligence.

Why This Matters for Employers

This extension gives employers more time to clarify employment relationships and avoid misclassification risk, which is important for companies leveraging flexible arrangements or contractors. EOR partners must still help clients align engagements with local classification norms.

Equivalent Conditions for Temporary Agency Workers

What is Changing

From 1 January 2026, a new collective labour agreement for temporary agency workers takes effect. Employers must ensure that the overall package of working conditions for agency workers is at least equivalent to those in similar roles directly employed by the client company.

Current Practice

Previously, agency workers often had different or lesser benefits compared to direct hires. As of 2026, this gap must be closed in value, even if not every employment term is identical.

Why This Matters for Employers

This change increases compliance obligations for companies using agency placements or EOR arrangements resembling agency deployments. EOR partners should review worker conditions and help align them with comparable direct hire roles to meet the equivalence test.

New Pension System Implementation

What is Changing

January 2026 marks broad implementation of the new Dutch pension system under the Future of Pensions Act. Millions of workers transition to this updated system.

Current Position

The Dutch pension system is being modernised to improve predictability and retirement outcomes. Employers and pension administrators will follow new valuation and contribution rules.

Why This Matters for Employers

Employers must update pension administration and employee communications. EOR partners should ensure payroll and benefits systems support new pension calculations and regulatory reporting.

Minimum Wage Increase

What is Changing

The statutory minimum hourly wage for employees aged 21 and over will increase as of 1 January 2026.

Current and New Rates

The minimum gross hourly wage will move from €14.40 to €14.71 for employees aged 21 and older. Youth wages for younger workers are calculated as percentages of the standard minimum wage.

Why This Matters for Employers

Payroll systems must be updated to reflect the new minimums. Failure to pay correctly may expose companies to fines and wage claims. EOR partners are key to ensuring accurate payroll implementation.

Tax‑Free Allowances and Reimbursements

What is Changing

Several tax‑free allowances are being adjusted or scaled back in 2026.

New Arrangements

• Home‑working allowance increases to €2.45 per day
• Travel allowance remains €0.23 per kilometre
• Extraterritorial costs reimbursement (ETK) will be scaled back

Why This Matters for Employers

Benefits commonly used for remote work and expat support are changing. Employers should review compensation and allowance structures to stay compliant and competitive. EOR partners can ensure payroll systems handle these allowance changes accurately.

Transition Payment and Severance Levy

What is Changing

Transition payments payable upon dismissal will be adjusted, and severance levy rules will become stricter.

Updated Rules

• Maximum statutory transition payment increases to €102,000 or one year’s salary if higher
• Employers face a 75 percent pseudo‑final levy on excessive severance above thresholds

Why This Matters for Employers

This affects termination cost planning and workforce strategies, especially for senior or highly paid employees. EOR partners can advise on contract termination policies and cost implications.

Wage Cost Benefit Removal for Older Employees

What is Changing

The wage cost benefit (LKV) previously available for employees aged 56 or older will no longer apply from 1 January 2026 for new contracts.

Why This Matters for Employers

This affects total employment costs for older hires. Employers and EOR partners should review hiring incentives and adjust compensation models.

Other Notable Adjustments

Remuneration Caps

Maximum remuneration under the Executives’ Pay Standards Act rises to €262,000 for 2026. Different caps apply in sectors such as education, healthcare, and housing.

Pensionable Salary

The maximum pensionable salary remains at €137,800 gross.

Early Retirement / RVU Scheme

Threshold exemptions under early retirement schemes rise to €2,357 per month, with additional allowances for certain employees.

Why This Matters for Employers

These adjustments influence total employment cost planning, benefits design, and compliance reporting. EOR partners should incorporate these changes into payroll and HR management workflows.

How Tarmack Supports Employers Through These Employment Law Changes

Tarmack helps employers navigate the evolving Dutch employment landscape by:

• Updating payroll systems to reflect new wage levels and allowances
• Advising on worker classification and agency parity compliance
• Managing pension, severance, and termination cost implications
• Ensuring statutory benefits and reimbursements are accurately administered
• Reducing administrative burden so employers can focus on growth

With an experienced Netherlands Employer of Record partner, your organisation can remain compliant, competitive, and resilient as Dutch employment regulations evolve.