Fintech sector upset about stricter rules for salaries, bonuses
The Dutch government is planning to implement stricter rules for financial institutions' remuneration policies, including stricter rules on share benefits and bonuses. Representatives of the FinTech sector, which falls under 'financial institutions', are outraged by these new rules, saying that they will result in higher financial risks for the companies, unfair competition, and higher administrative costs, Financieele Dagblad reports.
In a recent letter to parliament, Finance Minister Wopke Hoekstra announced that he wants to oblige financial sector employees to keep the shares that they receive as part of their fixed remuneration for at least five years. He also plans to tighten the conditions under which financial institutions can deviate from the bonus cap of 20 percent of the remuneration.
Hoekstra's plans will have a negative impact on FinTech companies, which are often new, innovative companies with uncertain incomes, the sector believes.
According to Maurice Jongmans, chairman of FinTech sector association VBIN, the Dutch bonus cap already has a negative effect on the business climate and stricter rules will further erode the equal playing field in Europe. Limiting flexible remuneration may also lead to an increase in fixed salaries, he said to FD. "This creates greater risks for the company, because wage costs are often the highest cost item, which makes the company inflexible", he said.
Gaston Aussems of payment company Mollie told FD that Hoekstra's bill is an "obvious mistake". "That we as payment company fall under this law, was already an error", he said. "But until now we didn't really have a problem with it, because our bonuses do not exceed 20 percent. But now he also wants to mess with the fixed wage policy, with the minimum period that you have to hold shares: five years. For millennials, that is longer than their career with one employer."