In November 2017, a legislative proposal was submitted to the Dutch Parliament to amend the Placement of Personnel by Intermediaries Act (Wet allocatie arbeidskrachten door intermediairs, hereinafter: Waadi), regarding payrolling. The proposal intended to make sure that payroll employees work under the same employment conditions as employees who were directly employed by the undertaking and performing the same or equivalent positions. The purpose of the legislative proposal is to prevent improper competition between payroll employees and “normal” employees, regarding employment conditions. The legislative proposal is still pending at the moment.
Meanwhile, another legislative proposal has been submitted for an internet consultation, regarding a number of changes in the Dutch Civil Code. It also includes a definition of payrolling and declares a specific regime applicable on payroll agreements. The proposal intends to make a differentiation between payrolling and agency work. Payrolling will, in the new definition, differ from agency work in the sense that agency employers have an active role on the labor market, bringing supply and demand of work together (the so-called allocative function). Payroll employers do not have such allocative function since the hiring undertaking itself searches the employee which it will hire. For agency work, a so-called “light” regime applies when it comes to dismissals and the conclusion of temporary contracts. This “light” regime will only apply on payrolling in a very limited way. The new definition of payrolling will also apply on intra-concern posting of employees.
Whether the proposed change of the Waadi-Act, as well as the proposed change of the Dutch Civil Code, will actually be realised, remains to be seen. Both proposals have received quite some criticism from employment law specialists in both the academic world as well as in law firms.
