Dutch government's planned freelance worker reforms won't solve inequality problems
The two laws with which the Dutch government wants to reduce the inequality between freelancers and permanent employees on the labor market will not actually work, the Council of State said in advice to the government on Monday. “The government’s approach in two bills to reform the labor market falls short because it does not fundamentally reform the labor market,” the government’s most important advisor said.
The two bills date from the previous Cabinet. One aims to give freelancers more job- and income security and another to combat fake self-employment and encourage more permanent contracts. But according to the Council of State, neither of these bills will have the desired effect.
The Certainty for Flexible Workers bill mainly focuses on more clearly defining the existing possibilities and practices regarding flexible work. The bill limits the difference between the maximum and minimum hours a freelancer can work to 30 percent, but it's unclear what effect that will have. It also bans on-call contracts, which may prove impossible in practice.
The bill also includes multiple exceptions to measures for minors, school pupils, and students with a part-time job to offer them more flexibility. But according to the Council of State, those exceptions also come with “less security and protection.” The Council of State expects this bill to have a “limited effect” and urged the government to better motivate these differences in treatment.
The bill to combat fake self-employment, where freelance workers do the same work as permanent employees but save employers the government contribution to social security benefits, identifies legitimate issues, but will only contribute to solving these issues to a limited extent, the Council of State said.
There is already a law to prevent freelancers from doing work that is actually part of an employment contract. “This bill mainly codifies the applicable law,” the Council said. “The development that more and more workers are active as self-employed, even where an employee position would be more appropriate, will therefore not be directly countered by this proposal.”
The Council also raised concerns about the consequences if a freelance position is determined to be an employment contract. “This can have far-reaching consequences due to the obligation to pay pension contributions for previous periods,” the Council said. The government needs to more clearly explain how these risks can be managed.
