Anyone who supplies staff or hires staff through a temporary employment agency, a secondment agency or another labour supplier will be subject to new rules from 2027. The Act on the Authorisation of the Supply of Workers (Wtta) introduces an authorisation scheme for companies that supply workers.
The implications are not limited to temporary employment agencies. Secondment agencies and other companies that make workers available to third parties may also fall under the new rules. Furthermore, the companies that hire these workers – the hirers – will also have specific responsibilities.
What exactly is going to change, and when do you need to take action?
Why is a licensing scheme being introduced?
The Wtta is intended to combat abuses in the labour hire market and to better protect the position of workers – particularly migrant workers. At the same time, the Act aims to ensure a more level playing field between companies that supply staff.
The essence of the new system is simple: from 2028, in principle, a company will only be permitted to supply workers if it has been officially authorised to do so.
Implementation of the system will be the responsibility of the Dutch Temporary Agency Work Authority (NAU).
What conditions must a temporary agency meet?
To be eligible for authorisation, a temporary agency must meet various conditions. Among other things, it must submit a Certificate of Good Conduct (VOG) and, in principle, provide a security deposit of €100,000.
In addition, the company must demonstrate that it complies with the relevant labour law, tax and social security regulations. This includes, for example, the rules concerning the statutory minimum wage.
Inspection bodies will check whether temporary staffing agencies meet the set requirements. The NAU then decides on authorisation on behalf of the Minister for Social Affairs and Employment. Under certain circumstances, authorisation may also be suspended or withdrawn.
Not just temporary employment agencies
The name of the Act may be somewhat misleading. The Wtta is not exclusively relevant to traditional temporary employment agencies.
Other companies that make workers available to another party in return for payment, to carry out work under that party’s direction and supervision, may also be subject to the authorisation requirement. Consider, for example, certain secondment arrangements.
For companies that make staff available to other businesses, it is therefore advisable to assess in good time whether their services fall within the scope of the Wtta.
Hiring organisations must also be vigilant
An important aspect of the Wtta is that responsibility is not placed solely on the supply agency.
From the moment the licensing requirement is enforced, companies may, in principle, only hire staff from a licensed supply agency. Hiring organisations will therefore need to check whether the party with whom they are doing business is in fact licensed.
This means that choosing a temporary employment agency or other staffing provider is no longer solely a commercial matter. From a legal and compliance perspective, too, it becomes important to check who one is working with.
Anyone who hires workers through a temporary employment agency that does not hold the required authorisation may, in fact, face enforcement action and a fine themselves.
When will the new rules come into force?
The introduction will take place in phases.
The Wtta will come into force on 1 January 2027 . For existing labour hire agencies wishing to make use of the transitional arrangement, the period from 1 November to 31 December 2026 is particularly important. They must register with the NAU during that period.
They can then apply for authorisation in 2027. From 1 January 2028 , the Dutch Labour Inspectorate will enforce the authorisation requirement.
That may seem a long way off, but for businesses falling under the Wtta, it is wise not to wait until the last minute.
What does this mean in practice?
For temporary employment agencies, secondment agencies and other organisations that make staff available, it is advisable to assess now whether they fall under the Wtta and, if so, whether they can meet the authorisation requirements.
The Wtta also warrants attention from employers who regularly hire staff. They will need to structure their contracts and internal processes in such a way that it will be possible to verify whether a labour supplier actually holds the required authorisation.
The key points to consider are therefore:
- assess whether the provision of workers within the meaning of the Act is taking place;
- as a user of temporary staff, check in good time which authorisation conditions apply to your business;
- take into account the transitional arrangements and the relevant deadlines;
- as a user of temporary staff, identify which temporary employment agencies, secondment firms and other suppliers are used to hire staff;
- ensure that, once the authorisation requirement comes into force, you only work with parties that meet the legal requirements.
.
Conclusion
The Wtta brings about a significant change for the Dutch labour hire market. It is particularly important to note that the new rules are not limited to unscrupulous temporary employment agencies or to companies that primarily employ migrant workers. Regular temporary employment agencies, secondment agencies and other companies that supply workers may also be affected.
Nor is the hirer immune from these changes.
You should therefore have the implications of the Wtta for you, your organisation and/or your existing contracts assessed in good time.
Do you have any questions about the provision or hiring of staff, or about the implications of the new legislation for you or your business? Please feel free to contact one of the employment lawyers at SPEE advocaten & mediation.
Monique J.E. Spee, LL.B., lawyer and MfN-registered mediator