Start 2025 well prepared: upcoming changes to employment law

Increases in 2025

Minimum hourly wage

Since 1 January 2024, the mandatory minimum hourly wage has been introduced and there are no longer fixed minimum monthly, weekly and daily wages. The minimum hourly wage will be increased on 1 January 2025 to €14.05 gross per hour. The next revision will then follow on 1 July 2025.

Home working allowance

The maximum untaxed home working allowance goes from €2.35 to €2.40 per day.

Maximum transitional compensation

The maximum transitional compensation, which was €94,000 gross in 2024, will be increased according to contract wages. The maximum compensation for 2025 is not yet known.

End of enforcement moratorium on DBA Act

From 1 January 2025, the Tax Authority will start enforcing again on false self-employment. This means that the Tax Authorities can impose corrections, surcharges and fines on companies using false self-employed workers. We discussed this earlier in this article. On 1 November 2024, the Tax and Customs Administration published an Explanatory Memorandum on Assessment of Employment Relationship, which sets out the facts and circumstances that play a role in assessing the employment relationship between a company and a contractor.

This article on our website points out that, given this development, organisations would do well to map out their collaborations with self-employed workers and distinguish between the 'real' self-employed and possible false self-employed. On this basis, it may be possible to adjust the cooperation, or to offer false self-employed workers an employment contract.

Possible upcoming changes to employment law

Bill Clarification Assessment Employment and Legal Presumption (VBAR)

This bill aims to reduce false self-employment and, to this end, gives further substance to the so-called authority criterion from the employment contract. It also introduces a legal presumption based on an hourly rate of €33 or lower. At such rates, labour is presumed to be performed based on an employment contract. The Council of State is critical of this bill, but Minister Van Hijum of SZW has announced that he will send the bill to the House of Representatives before the end of this year. The intended effective date is 1 January 2026.

Bill to modernise non-compete clause

Back in March 2024, we informed you about a bill to restrict the possibilities of agreeing a non-compete clause. The main changes regarding the non-compete clause in the bill are:

1. The non-compete clause in terms of duration limited to a maximum of 12 months;
2. The geographical scope should be explicitly mentioned when drafting the non-compete clause;
3. Employment contracts of indefinite duration - as is currently the case for fixed-term employment contracts - must also include written reasons why the non-competition clause is necessary because of essential business or service interests;
4. If the non-compete clause is invoked, the employer must pay the ex-employee compensation of 50% of the monthly salary for each month the non-compete clause is in force.

After the closure of the internet consultation, the possibility of legally regulating that a non-compete clause is null and void if an employee earns one and a half times modal (€66,000 gross per year) or less per year in full-time employment was considered by then-minister Van Gennip. In a parliamentary letter dated 17 June 2024, Minister Van Gennip indicated that it would be up to a subsequent cabinet to determine how the pros and cons surrounding the inclusion of the salary cap in the bill would be weighed. An effective date is not yet known.

Restriction of compensation for transition allowance

Currently, employers can ask the UWV to be compensated for the transitional compensation paid to long-term unfit employees. In the budget annex to the outline agreement, the new cabinet announced its intention to drop this compensation option for employers with 25 or more employees. This intention was confirmed in the Budget Day documents and it was made clear that from 1 July 2026, only employers with fewer than 25 employees will be entitled to compensation of the transitional allowance.

Be prepared for employment law changes

So, there are significant changes on the way, at least the lifting of the enforcement moratorium of the DBA Act is likely to have a major impact on many organisations in the short term. However, there are also several other, far-reaching changes in the pipeline. Want to stay informed? Then sign up for our newsletter!