The Social and Economic Council (SER) issued its first recommendations on the position of self-employed workers in the Netherlands in September 2010, proposing the need for agreed minimum rates for self-employed workers. SER believes adjustments are needed to the social security system with respect to the self-employed but not fundamental change. Its recommendations have been welcomed by the new trade union for self-employed workers (FNV Bond voor Zelfstandigen).
The Social and Economic Council (SER) issued its first recommendations on the position of the self-employed person in September 2010. SER identified a 33% increase in the number of self-employed workers over the past decade: at over 675,000 people this amounted to around 9% of the national workforce in 2009.
The growing numbers of self-employed workers also revealed some areas of potential friction in socioeconomic policy. Being neither employees nor employers, these workers fall outside the central social security system in the Netherlands, which is based on a clear distinction between the two. Self-employed workers now have to enter into insurance schemes to supplement their earnings – in the event of, for example, occupational disability. They also have to make arrangements for other welfare provisions, such as pensions, which not all of them have done in the past. The Council believes that, although adjustments are needed, the system does not require fundamental change.
SER also urged self-employed workers to consider the risks they are taking as entrepreneurs. This marks the first time that independent entrepreneurs were able to discuss their own position in the labour market within SER, as the Union of Independent Entrepreneurs (PZO) has been given a seat on the Council by the Confederation of Netherlands Industry and Employers (VNO-NCW) (NL1004019I).
SER opts for protection and clarity
SER proposed that an agreement should be reached on minimum rates for self-employed workers. In principle, self-employed workers conduct their business at their own expense and risk. The economic crisis has forced a number of self-employed workers to conduct business below cost, resulting in problems in the long term. Although entrepreneurs are responsible for their income, SER would like to avoid excesses and does not believe this to be in conflict with the Competition Act. SER’s recommendation ties in with the wishes of the new trade union for self-employed workers, FNV Bond voor Zelfstandigen, which is calling for minimum rates to prevent the erosion of employment conditions.
It is becoming clear that the economic crisis has hit some self-employed workers disproportionately hard. The consequences for a group having little recourse to social security are also clear. Many self-employed workers do not have occupational disability insurance and have not set aside savings for their pensions. For this reason, SER wishes to assess the extent to which company pension funds could be opened up for this group. In addition, the occupational disability insurance threshold must be lowered. Finally, self-employed workers must be awarded the same rights to education as ‘normal’ employees. The arrangements provided to employees should also be accessible for the self employed.
FNV Bond voor Zelfstandigen supports SER recommendation
SER’s recommendation and the more concrete instructions it contains correspond with the position adopted by FNV Bond voor Zelfstandigen, which is calling for self-employed workers to be awarded the same rights as employees. The union supports SER’s analysis and recognises the concerns of self-employed workers in the current economic crisis. The union is also enthusiastic about the solutions presented. However, FNV Bond voor Zelfstandigen would like to see the position of self-employed workers more clearly defined in relation to taxation. This relates to the Declaration of Independent Contractor Status, which is a tax scheme for the self-employed. But as their status is often only recognised later (that is, after the start of business activity), in some cases self-employed people have been faced with unexpectedly having to pay contributions retrospectively, even though just like employees, independent entrepreneurs have every right to be made aware of their legal obligations in advance.
Marianne Grünell, Hugo Sinzheimer Institute (HSI)