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The employment of foreign workers. What issues do you need to be aware of as an employer?

March 2012 - Employment. Legal Developments by AKD.

More articles by this firm.

The employment of foreign workers regularly raises questions. A brief summary of the most important areas of attention will be dealt with in this article.

Work permit

The main rule, based on the Foreign Nationals Employment Act (Wet Arbeid Vreemdelingen, hereinafter called 'Wav'), is that it is prohibited for an employer to allow 'a foreign national' to carry out work if they do not have a work permit. A work permit is not required for a citizen of a member state of the European Union (EU). A work permit is also not required for a citizen of a member state of the European Economic Area (EEA). For workers from member states who joined the EU on 1 January 2007, namely Bulgaria and Romania, however, a work permit is still required.

Definition of the term "employer"

The definition of the term "employer" in the Wav is rather broad, and is different to the way the term "employer" is defined in other legislation. If work is carried out at the direction of, or in service of, a party, this party is considered to be an employer under the Wav. A consequence of this broad definition under the Wav is that a foreign national can have several employers. Each of these employers must check to make sure a work permit has been obtained for the foreign national. If a work permit has not been obtained for a foreign national, a fine can be imposed on all of the employers of the same foreign national.

Granting of a work permit

In principle, a work permit will be granted by the UWV WERKbedrijf (employment services agency) if no suitable personnel can be found in the EU or the EEA for the relevant position to be filled by the foreign national. The employer must notify the vacancy to the employment services agency at least five weeks before the application for the work permit is made.

No work permit required.

There are several exceptions to the prohibition on the employment of foreign nationals without a work permit.

Self-employed persons

No work permit is required for persons who carry out work on a self-employed basis.

Multinational corporations

A work permit is not required for employees of multinational corporations in certain cases. These multinational corporations must have an annual turnover of at least € 50 million. Furthermore, the employee of the multinational corporation must be part of the management or highly qualified, and have an annual income of at least € 50,000. Furthermore, employees of a multinational corporation may work on outplacement for a maximum of one year in connection with the exchange of specific knowledge or technology. In such cases, the relevant employees must be qualified to at least higher vocational (HBO) level.

Incidental employment

In addition, a work permit is not required if a foreign national carries out incidental work during a very short period, for example in order to hold business meetings, sign contracts (maximum of four weeks), the installation or modification of software (maximum of 12 weeks), or for the performance of artistic works.

Knowledge migrants

Finally, no work permit is required if a foreign national can be designated as a knowledge migrant. A knowledge migrant is a foreign employee who is employed by a Dutch employer, or who is transferred to a Dutch branch of his or her foreign employer, and whose gross annual income is at least € 50,619. If the employee is aged under 30, he/she must (currently) have an annual income of at least € 37,121. For foreign students who have completed academic studies in the Netherlands, and who find a job as a knowledge migrant within one year, the minimum income threshold is currently € 26,605. The above amounts are adjusted annually. Moreover, knowledge migrants, regardless of their salary, are also deemed to be: foreign doctors training to become a specialist in the Netherlands, scientific researchers, and non-European students who are studying at a Dutch educational institution and who want to follow an internship in the Netherlands. An employer must, however, sign a covenant with the Immigration and Naturalisation Service (IND) before they can make use of the exemption under the knowledge migrant regulations.

Financial penalties

The inspectors of the Health and Safety Inspectorate carry out checks to make sure an employer has a valid work permit for each foreign national. If an employer has failed to apply for a work permit for a foreign national, an administrative fine can be imposed on the employer. This fine can be up to a maximum of € 8,000 per foreign national. In addition, fines can be imposed on the employer in relation to administrative failures. As pointed out earlier, a fine can be imposed simultaneously on several employers of the same employee, for example the employment agency hiring out the employee and the host company. In practice, the host company will often try to recover the fine from the employment agency. However, recovery of this fine is only possible if agreements have explicitly been made about such between the host company and the employment agency.

In conclusion

The above gives a brief summary of the regulations in relation to work permits for foreign nationals. If you would like to know more about the regulations described above, you can get in touch with the editorial board of the newsletter.

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