Subcontracting of workers under the Posted Workers in the European Union (Working Conditions) Act

Publication August 2017


Introduction

The Posted Workers Directive (Directive 96/71/EC and Directive 2014/67/EU) (the Posted Workers Directive) applies where a company (the Service Provider) in one EU member state, has a contract to provide services to an undertaking in another member state and pursuant to that contract posts workers (Workers) to that other member state. The Posted Workers Directive is implemented in the Netherlands by the Employment Posted Workers in the European Union Act (Wet arbeidsvoorwaarden gedetacheerde werknemers in de Europese Unie) (WagwEU).

Below we look at the most important aspects of the WagwEU.

Enforcement

There are a number of administrative obligations which apply to Service Providers:

  1. The duty to report: Service Providers must report in advance about where and when and with which employees work will be performed in the Netherlands. A copy of the report has to be provided by the Service Provider to the service recipient. The service recipient in the Netherlands has to check whether the report has been made and whether it is correct.

    This obligation will come into force at a later date, probably on 1 January 2018.
  2. The obligation to have certain documents available at the workplace: the documents must be in hard copy or electronically and cover such matters as the identity of the Service Provider and the recipient; employment agreements of Workers; salary slips and evidence of wages paid to the Workers; overview of working hours; valid-ID, evidence showing the contribution for social security schemes.
  3. The obligation to provide information: all relevant information, if requested, must be provided to the Inspectorate SZW which is designated to enforce the WagwEU.
  4. The obligation to appoint a contact person: this individual functions as a point of contact for the Inspectorate SZW and is ideally a posted Worker in the Netherlands.

Employment conditions

A Worker who temporarily works in the Netherlands under the Posted Workers Directive, irrespective of the law that governs the underlying employment contract, derives rights from the WagwEU on day one of the assignment. In accordance with Article 2 of the WagwEU, the foreign employer is obliged to apply several provisions of the Dutch Civil Code to the underlying relationship.

The Posted Workers Directive provides a limited list of terms and conditions that should be guaranteed by the Service Provider:

  1. maximum work periods and minimum rest periods;
  2. minimum paid annual holidays;
  3. minimum rates of pay, including overtime rates;
  4. conditions for making employees available;
  5. health, safety and hygiene at work;
  6. protective measures with regard to the terms and conditions of employment of pregnant women or women who have recently given birth, of children and of young people; and
  7. equality of treatment between men and women and other provisions on non-discrimination.

Applicability of Collective Labour Agreements (CLA)

In addition to the rights under the Dutch Civil Code (7:616, 7:626; 7:634-642; 7:646; 7:648; 7:649; 7:655; 7:658), the Worker must be guaranteed any terms and conditions under any CLA that has been declared generally binding in a given sector of industry. If these obligations are not observed, the Inspectorate SZW may impose a fine. The amount of any fine can be increased where there has been wilful evasion or repeated offence.

Whether a universally binding CLA applies can be checked here (Directie Uitvoeringstaken Arbeidsvoorwaardenwetgeving). If certain provisions from the CLA are not observed, employees and/or social partners may institute an action against the Service Provider.

CLAs that have been specifically mentioned on the website of the SZW Inspectorate are: (i) the CLA for temporary agency workers; (ii) the CLA for the Dutch Insurance Industry (office staff); (iii) the CLA in the Metal Working and Electrical Engineering Industry (Metalektro); and (iv) the CLA for the Dutch Construction Industry.

Responsibility for the substantive accuracy of the information provided and the translation of the CLA provisions rests exclusively with the parties to the CLAs. Only the Dutch version of the text of the decision to declare a provision universally binding (AVV Decision) has legal validity for the determination of rights and obligations.

Further questions / legal advice

Please feel free to contact Maartje Govaert or Thomas Timmermans for any advice or further questions in respect of the above.


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