Browse through brief employment and labor law updates from around the globe. Contact a Littler attorney for more information or view our global locations.

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New Remuneration Standard for Senior Officials

New Legislation Enacted

Authors: Eva Schneiders, Associate, and Michelle Engberts, Associate – Clint | Littler

As of January 1, 2024, employers are no longer allowed to provide unlimited tax-free reimbursement of additional costs incurred by employees due to a move to the Netherlands. The so-called “Balkenende standard” (in Dutch: Balkenendenorm) will start to apply.

The Balkenende standard refers to the remuneration standard for senior officials stipulated in the Senior Executives in the Public and Semi-Public Sector (Standards for Remuneration) Act (in Dutch: Wet normering topinkomens).

Proposed Reform of Non-competition Clauses

Proposed Bill or Initiative

Authors: Eva Schneiders, Associate, and Michelle Engberts, Associate – Clint | Littler

The non-competition clause prohibits an employee from performing similar work with another company or as an entrepreneur after the end of their employment contract. With the “Modernize Non-Competition Clause” Bill (in Dutch: Wetsvoorstel Modernisering Concurrentiebeding), the government proposes a number of restrictions for the use of non-competition clauses, including the following:

• The non-competition clause can be effective for up to one year after the end of the employment contract
• The employer must justify the duration and geographical scope in writing in the employment contract
• The employer must (also) justify the weighty business interest of a non-competition clause in writing in employment contracts for an indefinite period (this already applies to fixed-term employment contracts)
• If an employer holds a leaving employee to the non-competition clause, the employer must pay compensation to the employee. This compensation amounts to 50% of the last-earned monthly salary, for each month the non-competition clause is invoked

These new rules will also apply to the business relationship clause. The Bill was submitted for consultation on March 4, 2024 (until April 15, 2024).

Bill Extension of the Older Unemployed Persons Income Scheme Act

Proposed Bill or Initiative

Authors: Eva Schneiders, Associate, and Michelle Engberts, Associate – Clint | Littler

A bill to extend the Older Unemployed Persons Income Scheme Act (“IOW”) (in Dutch: Wet inkomensvoorziening oudere werklozen) was introduced on February 19, 2024, for debate by the House of Representatives and the Senate. If approved, the bill will extend the IOW by four years to January 1, 2028. Job seekers aged over 60 years and four months will be able to apply for IOW benefits once their unemployment benefit or WGA benefit have expired. The IOW benefit prevents older unemployed people from having to fall back on welfare and draw on their savings in the years before they are entitled to an old-age pension benefit (in Dutch: Algemene Ouderdomswet uitkering).

If the House of Representatives and the Senate agree to the Bill, it will take effect retroactively from January 1, 2024.

Bill to Increase Minimum Wage

Proposed Bill or Initiative

Authors: Eva Schneiders, Associate, and Michelle Engberts, Associate – Clint | Littler

A bill was introduced by the House of Representatives to increase the legal minimum wage by 1.2% as of July 1, 2024, in addition to the regular half-yearly increase. Exactly how high the minimum wage will become is not yet known and will depend on the six-monthly indexation of the minimum wage rises along with the collective bargaining wages. The higher minimum wage will affect benefits such as welfare, social security, among others.

The bill will need to be debated and approved by the Senate by April 16, 2024, at the latest. The amounts will be announced in the spring of 2024.