New self-employment law aims to provide clarity and prevent false self-employment

The Dutch government has introduced a new legislative proposal, the Self-Employed Persons Act, to clarify the status of independent contractors and curb instances of disguised employment. This initiative aims to end two decades of uncertainty surrounding the work status of the 1.2 million self-employed individuals currently operating in the Netherlands. By establishing clear criteria, the cabinet hopes to encourage employers to hire contractors without fear of penalties while ensuring workers remain truly independent.

The legislation introduces two main assessments to determine worker status. The first evaluates individual entrepreneurship, requiring contractors to demonstrate multiple clients, business registration, and investments in essential provisions like disability insurance and pensions. The second assessment focuses on the specific working relationship, ensuring the contractor maintains autonomy over their methods, schedule, and location while bearing personal economic risk. Those meeting these criteria enter a so-called safe harbor, providing them with legal certainty. The tax authorities will continue to enforce regulations against disguised employment, which is defined as work that functions as traditional salaried employment.