Skip to main content

What does the outline agreement mean for payroll and HR?

On 15 May 2024, the PVV, VVD, NSC and BBB parties finalised an outline agreement. This sets out how they want to make work financially more worthwhile and so increase livelihood security and boost spending power. The Senate voted against the bill that would have resulted in an extra 1.2% increase in the minimum wage from 1 July 2024. According to the coalition parties, this money should be used to fund various proposals in the outline agreement, including:


To make it financially attractive to work more hours, the parties plan to cut the tax and social security charges payable on labour and also to reduce the marginal tax burden, possibly by introducing an extra income tax bracket. Policy to improve labour market security for genuinely self-employed contractors is planned, including regulations for the temporary employment sector and higher numbers of permanent contracts. Parliament will meanwhile continue discussing the Labour Relations Clarification and Legal Presumption Act (VBAR) and the Labour Provision (Accreditation) Act (WTTA), and will clamp down hard on undesirable temporary employment arrangements.

Taxes and businesses

The outline agreement includes plans to reform the tax and benefits system. The four parties want, for example, to reduce the SME profit exemption from 13.31% (2024) to 12.7% in 2025, instead of the previously announced reduction to 12.03%. The plan to end companies’ right to repurchase their own shares without paying dividend tax (‘dividend tax repurchase facility’) will be reversed, and the right to deduct gifts from income and corporate taxes will be restricted. The General Unemployment Fund (‘AWF’) contribution for people on permanent and flexible contracts will rise by 0.1% in 2026.

The parties also want to improve the business climate. Some cost increases previously announced for businesses are being partly reversed, including the planned increase in energy tax and on capital.

The coalition partners want vehicle fleets to become more sustainable. However, drivers leasing electric vehicles will have to pay a fairer share so that revenues remain viable in the longer term. Subsidies available for electric vehicles will therefore end in 2025.


Transition payments

The parties’ plan is for compensation for employee transition payments to be available only to small businesses with fewer than 25 employees. Employers with more than 25 employees will therefore no longer receive compensation if they end the contract of an employee who is unable to return to work after two years of being on paid sick leave.

Knowledge migrants

The parties recognise the importance of knowledge and study migrants for the Dutch economy. But they also want to balance these forms of migration against what local municipalities, the education and care sectors and the housing market can handle. They are therefore planning to tighten the requirements for qualifying for the knowledge migration scheme. Labour migrants (other than knowledge migrants) from outside the EU will need a work permit to work in the Netherlands. In addition, the 30% ruling for foreign employees working temporarily in the Netherlands and earning more than €46,107 a year may become less generous or be partly or fully discontinued.

Employers should also be given greater scope to provide on-site accommodation for labour migrants. The employer will be responsible for ensuring that long-term migrants learn Dutch. The opportunities for foreign students to enrol on Bachelor programmes at Dutch universities will be more limited, except for degree subjects where there is a labour market shortage. Account will, however, be taken of local circumstances.