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What are the considerations and risks when using temporary workers in Belgium and Netherlands?

MSPs • Apr 29, 2024 3:02:00 PM • Written by: Georgia Reynolds

Talent shortgaes are forcing businesses to look globally to hire the right talent. This can be a very effective strategy so long as businesses have assessed the risks associated with engaging workers compliantly in various territories.

Giant Group partners with Osborne Clarke on legal compliance in various countries and Dan Haslam, Group Sales Director at Giant host’s webinars that explore several countries' complexities and compliance issues. Last month Dan focussed on Belgium and Netherlands with guests Jorgo Tsiris and Thierry Vierin from Osborne Clarke. 

Let's recap and delve into the complexities of Belgium and the Netherlands, gaining insights from industry experts." Clear agreements are essential in Belgium, where high social security charges incentivise self-employment."

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How do terminologies and language differ between countries?

In discussing the terminology used in the temporary labour market, the variation thats exist between countries, can sometimes lead to confusion. Jorgo Tsiris broke down worker engagement in the Netherlands into three main types: payrolling, temporary work agency, and self-employed workers, each governed by its own rules.

For example the engagement of contractors as self-employed workers, i.e. those who don’t work through a limited company are referred to as ZZPs in the Netherlands, sole traders in the UK, and self-employed freelancers in Belgium.

Despite slight variations in terminology, the overarching message emphasised the importance of understanding worker categories and complying with local regulations. This understanding is crucial for effectively managing the hiring of temporary workers across different jurisdictions. and most importantly minimising risk. 

What is the legal landscape surrounding worker classification?

Thierry Vierin discussed the critical role of clear agreements in mitigating legal risks within Belgium's unique social security framework, where steep charges for employees incentivise self-employment.

Avoiding misclassification errors demands a thorough review of both contractual terms and practical work arrangements. To pre-empt reclassification pitfalls, contracts should incorporate indemnification clauses and prioritise defining work scope and outcomes rather than prescribing methods.

Practical measures for assessing self-employment status include confirming registration as an entrepreneur, validating VAT inclusion on invoices, and clearly outlining responsibilities. Restricting access to company resources and maintaining a separation between self-employed individuals and core activities further solidifies the distinction between self-employment and employment relationships.

Daniel Haslam and Charles Daw from Giant said how important it is to understand the legal risks and business factors involved in classifying workers and choosing engagement methods. Charles mentioned Giant's global version of the IR35 test, a tool used to determine worker classification internationally. This test, while not legally binding, serves as a valuable tool for evaluating whether an individual should be engaged as a freelancer or through an employment model. This means carefully examining how workers are engaged, making sure everything aligns with legal requirements, and minimising risks associated with misclassification.

Compliance requirements and legislative changes

Merrill, with expertise in compliance, outlines the compliance requirements for providers of temporary workers in the Netherlands. Registration and liability considerations are crucial factors for businesses engaging with temporary workers in the Dutch market. Staying up to date on upcoming legislative changes is imperative for businesses to adapt their practices and maintain compliance.

Navigating worker engagement and compliance in Belgium and the Netherlands is complex, but with insights from experts like Thierry, Jorgo, Merrill and Charles businesses can do it confidently. They highlight the importance of clear agreements, strong processes, and staying proactive with compliance.

As a global payroll provider, Giant Group understands the intricacies of worker engagement across different jurisdictions. Using our expertise, businesses can streamline their operations, mitigate risks, and ensure compliance with local laws and regulations. With the right approach and support, companies can thrive in the ever-evolving world of worker engagement.

If you would like to watch the webinar or want to see our Q/A please email us at hello@giantgroup.com

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Georgia Reynolds

Marketing Coordinator – Content