Hiring an international employee in the Netherlands can offer many advantages, but it also entails legal and administrative obligations. Employers must comply with strict rules regarding work permits, payroll taxes, and employment conditions. The employment law specialists at Arslan Advocaten explain what you as an employer need to be aware of.
Difference Between Foreign Employee and Expat
The term "expat" is often used for employees who temporarily work in the Netherlands from abroad, usually at a higher professional level. A "foreign employee" is any employee with a non-Dutch nationality who performs work here. Largely the same statutory rules apply to both groups, but the tax and residency aspects differ.
Work Permit and Residence Status
For employees from outside the European Economic Area (EEA) or Switzerland, a work permit (TWV) or combined residence and work permit (GVVA) is required. These are issued by the UWV and the Immigration and Naturalisation Service (IND).
Important Conditions for a Permit
- The employer must demonstrate that no suitable candidate is available within the Netherlands or the EEA.
- The employee must meet income requirements for knowledge migrants or labour migrants.
- The employer must be registered as a recognised sponsor with the IND.
If an international employee is employed without a valid permit, the employer may face a fine of EUR 8,000 per worker.
Employment Contract and Working Conditions
A foreign employee is entitled to the same employment conditions as Dutch employees performing comparable work, including minimum wage, holiday allowance, working hours, and rest periods. Applicable collective labour agreements (CAOs) must also be observed.
The 30% Ruling
Qualifying international employees may benefit from the 30% ruling, a tax advantage allowing employers to pay up to 30% of the salary as a tax-free allowance for extraterritorial costs. This arrangement is subject to specific conditions.
Risks for Employers
- Fines for employing workers without valid permits;
- Liability for underpayment or violation of employment conditions;
- Administrative penalties for incorrect payroll tax declarations;
- Reputational damage and loss of recognised sponsor status.
How Can Arslan Advocaten Help?
At Arslan Advocaten, we advise employers on all aspects of hiring international employees. From work permits to employment contracts, from tax arrangements to compliance — our lawyers ensure you meet your obligations and avoid risks. Contact us for expert advice.