Netherlands: Latest working life developments – Q4 2016

The issues at stake in the run-up to the General Election, the favourable economic growth and falling unemployment and the debates among the social partners and politicians on flexwork are the main topics of interest in this article. This country update reports on the latest developments in working life in the Netherlands in the fourth quarter of 2016.

General developments: Political, economic and legislative

The forthcoming General Election is affecting debates on working life issues and industrial relations, resulting in increasingly divergent opinions within the Cabinet on issues such as self-employed people, the minimum wage and cross-border employment. On social and economic issues the Labour Party (PvdA) has shifted to the left, while liberal coalition partner the People’s Party for Freedom and Democracy (VVD) sticks to its more free market and non-interference stance. The nationalist and right-wing populist Party for Freedom (PVV) has been leading the polls for quite some time.

Wage rises are gradually increasing against the background of better economic prospects, a recovering housing market and falling unemployment levels. Recent figures from the Central Bureau of Statistics (CBS) show that, in 2016, wage rises (1.9%) were the highest since 2009. In the public sector – after several years of wage freezes – there was a significant increase of 3.4%. Wage costs for employers increased by 2.0% in the same period.

There were no major developments on labour-related legislation. A major act on working conditions is still pending and will come into force on 1 July 2017. Several legislative initiatives on the rights of works councils (on equal pay and remuneration issues) are still pending or at an advisory stage (such as works councils’ influence on pensions in companies employing fewer than 50 people). In December 2016, a revised version of the Dutch Corporate Governance Code (PDF) was launched, reaffirming the Dutch stakeholder approach to companies and explicitly mentioning the role of works councils in the system of corporate governance.

Diverse reports from advisory bodies

The tripartite Social and Economic Council (SER) issued advice on various topics including:

In December 2016, the bipartite Labour Foundation (StvdA) issued advice on the rights of workers in case of bankruptcies, transfer of undertakings and public tenders. After several big bankruptcies, this issue has moved up the agenda of politicians and the social partners. Three bills on the modernisation of insolvency legislation are still either pending or in a preparatory stage. The bill on the so-called ‘pre-pack’ is at the most advanced stage and has potentially the largest impact for workers. During a pre-pack stage, a bankruptcy is prepared with the aim of saving as much of the business’s activities and employment as possible.

In November 2016, an independent advisory body to the government, the Central Planning Bureau (CPB), published a memorandum on flexworkers in the Netherlands (PDF). Around 40% of the working population currently have flexible contracts, including temporary agency workers, self-employed people and on-call workers. The rise in the proportion of flexworkers in the Netherlands in the past decade has been much higher than in other Member States, with the increase mainly involving less educated workers. The risk of unemployment and poverty is much higher for this group as they are less protected in the case of unemployment and disability, and only rarely build up occupational pensions.

In 2016, the Netherlands Organisation for Applied Scientific Research (TNO) published its biennial review of working conditions in the Netherlands. Based on this review, an overview of work-related accidents was published in December. The average annual number of accidents stood at 1,400 per 100,000 employees, slightly below the EU average. 

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