After challenging times for the Hotel & Leisure industry due to the COVID-19 pandemic, brighter days seem to be ahead as the vaccination programme in the Netherlands is in full process and the Dutch society and social life is slowly being reopened. Nevertheless, the Hotel & Leisure industry has suffered a lot during the COVID-19 pandemic and businesses in this industry face the challenge of increasing their workforce without exposing themselves to substantial financial risks.
In this article, opportunities will be addressed for employers in the Hotel & Leisure industry to increase their workforce by means of flexible workers.
Types of flexible working relationships
Flexible working relationships come in a variety of forms. The most well-known flexible working relationship is the fixed-term employment contract, which is a suitable way to cover temporary staffing needs.
Less well-known flexible working relationships in the Netherlands are (i) on-call employees (ii) temporary agency workers, (iii) payroll employees and (iv) independent contractors. We will address these different types of flexible working relationships below.
I. On-call employee
An on-call employee is an employee who is willing to work for the employer during periods to be specified by the employer. Depending on the situation and needs of the employer, different types of on-call contracts can be concluded.
The main characteristic of an on-call contract is that either no arrangements between employer and employee are made in advance about the number of hours to be worked by the employee, or a min-max hours agreement is made. The employer only pays out the hours the employee has actually worked, or the minimum hours agreed in case the employee worked less than the minimum agreed hours. However, the employer must pay out at least three hours for each call to work.
In case the employer wishes the employee to perform work on a specific day, the employer must call up an employee no later than four days in advance of that specific day, unless any applicable collective labour agreement allows for a shorter period. An employee is not obliged to comply with a call for work that is made later than four days in advance. Once a call has been made to perform work, the employer cannot simply withdraw such call for work without any consequences. In case of a (partial) withdrawal of a call to work, or a change of times within four days before the day on which the work is to performed, the employee concerned retains the right to wages for the times of the original call.
After twelve months of employment based on an on-call agreement, the employer must offer the on-call employee an employment contract containing a fixed number of working hours. The minimum number of hours that must be offered is the number of hours the on-call employee has worked on average per week during the preceding twelve months. The employee may refuse this offer.
II. Temporary agency workers
Engaging staff via a temporary agency means that a temporary worker is made available by a temporary agency (the employer) to the hirer (e.g. a company in the Hotel & Leisure industry) in order to perform work under the supervision and management of the hirer.
The advantages of engaging staff from temporary agencies is that temporary staff can be found quickly for short-term assignments and that the temporary agency qualifies as employer. Hence, the risks of continued payment of wages during illness and the administrative burden, such as payroll administration, are the responsibility of the temporary agency.
III. Payrolling
In case of payrolling, a person (the payroll employee) is recruited by the hirer, but a payroll company is used as an intermediary with whom this payroll employee formally enters into an employment contract. Subsequently, the payroll company makes this payroll employee exclusively available to the hirer and the hirer provides the payroll employee concerned with work.
Payrolling can be a solution if the hirer would like to have influence on the recruitment and selection process, but does not want to have any responsibilities connected to being the formal employer. The payroll company qualifies as formal employer and hence pays the payroll employee's salary, does the payroll administration and arranges the financial settlement of the employment, while it is the hirer that has authority over the payroll employee.
Payroll employees must receive the same employment conditions as employees in the similar position who are directly employed by the hirer or – if no similar positions are available at the hirer – market standard employment conditions. These include the salary, holiday allowance, bonuses, a thirteenth month etc.
IV. Independent contractors
An independent contractor does in principle not qualify as an employee under Dutch employment law. Hence, an independent contractor does neither enjoy inter alia dismissal protection nor will the independent contractor receive sick pay in case of sickness. In practice, however, the position of independent contractors is not always that clear, since the work relationship between a company and an independent contractor sometimes shows similarities with an employment relationship.
The decisive difference between a service contract and an employment contract is that in the working relationship with the independent contractor - contrary to the employee working relationship - the relationship of authority is absent.
Engaging independent contractors should be done carefully as the working relationship with the independent contractor may qualify as employment contract. If this occurs, the independent contract could claim inter alia dismissal protection, sick pay or a severance payment, also retrospectively for part or all of his/her past involvement with the company for a period up to five years. Also, third parties may derive claims from an employment status (e.g. pension funds or tax authorities).
More information?
May you wish to receive more information or may you have any questions concerning increasing your company's workforce by means of flexible employees/workers, please feel free to contact us.
