As we enter 2024, several important updates to employment in the Netherlands come into effect. These changes influence both employers and employees across various industries. Understanding the new rules helps businesses stay compliant and ensure fair working conditions for their teams.
What to Expect from Dutch Employment Law in 2024
From adjustments to travel and home-working allowances to revisions in the 30% ruling, the minimum wage, and salary criteria for highly skilled migrants, these updates shape how organisations manage HR and payroll in the coming year. Let’s explore the five main changes that affect employment in the Netherlands in 2024.
1. Higher Tax-Free Travel Allowance
Employers can now reimburse travel expenses tax-free for employees who commute by any means, including walking, cycling, driving a private car, or using public transport. The exception applies when an employer provides a company car or bicycle.
From 2024, the tax-free reimbursement rate for business kilometres rises from €0.21 to €0.23. In the Netherlands, there is no legal requirement to reimburse travel costs unless this is included in a collective labour agreement (CAO).
Another improvement in employment regulation in the Netherlands is that employers no longer need to deduct wage tax when employees do not use public transport often. This change simplifies administration, making it easier to offer travel reimbursements as an attractive secondary employment benefit.
2. Updated Work-from-Home Allowance – Netherlands Employment
Remote and hybrid working continue to be popular since the pandemic. Among the best changes in employment regulations in the Netherlands is that employers can now support their teams with a tax-free work-from-home allowance. This helps cover extra expenses such as heating, electricity, water, Wi-Fi, and office equipment.
The daily home-office allowance increases from €2.15 to €2.35 in 2024. However, employees cannot receive both the travel and home-working allowance on the same day. For hybrid workers, there are two options:
- Option 1: Calculate actual travel expenses on days they commute.
- Option 2: Agree on a fixed fee if they travel to a fixed location for at least 128 out of 214 working days per year (known as the 128/214-day scheme).
This flexible approach supports employees in balancing their work routines while maintaining compliance with Dutch tax rules.
3. Gradual Reduction in the 30% Ruling
New employment laws in the Netherlands: the 30% ruling allows foreign employees recruited from abroad to receive 30% of their salary tax-free to cover extra-territorial costs. To qualify, employees must meet specific salary criteria:
- Salary (excluding allowance) exceeds €46,107 in 2024.
- If under 30 with a Dutch master’s degree or equivalent qualification abroad, salary must exceed €35,048.
- Researchers conducting scientific work at recognised Dutch institutions remain eligible without a minimum salary requirement.
Starting in 2024, new applications will face a phased reduction of the benefit:
- First 20 months: 30% tax-free
- Next 20 months: 20% tax-free
- Final 20 months: 10% tax-free
Employees already benefiting from the 30% ruling before 1 January 2024 will continue under the existing arrangement. Note that if annual income exceeds €233,000, the employee is no longer eligible.
This change affects many expats and employers managing employment in the Netherlands, making accurate payroll administration more important than ever.
4. Introduction of the Hourly Minimum Wage
From 1 January 2024, the Netherlands introduces an hourly minimum wage of €13.27 gross for employees aged 21 and above. This replaces the previous monthly, weekly, or daily calculations.
Under the old system of employment in the Netherlands, someone working 40 hours weekly could earn a lower hourly wage than someone working 36 hours weekly. The new rule ensures that longer working hours always result in higher total earnings, promoting fairness and transparency across workplaces.
5. New Salary Criteria for Highly Skilled Migrants – netherlands Employment
Each year, the Dutch government reviews the salary thresholds for highly skilled migrants. As of 1 January 2024, new applications must meet the following monthly gross salaries (excluding the 8% holiday allowance):
- €5,331 for highly skilled migrants aged 30 and over
- €3,909 for highly skilled migrants under 30
- €2,801 for graduates during or after their orientation year
Employees already working under the previous salary requirements with valid residence permits do not need to adjust.
These updates are essential for companies that employ international professionals, reinforcing compliance with immigration and tax regulations tied to employment in the Netherlands.
Final Thoughts
Keeping track of these regulatory changes ensures your organisation remains compliant and attractive to both local and international talent. As an HR service provider, we help businesses manage payroll, employment law, and HR operations in line with Dutch legislation.
If your company needs guidance or hands-on support with HR or payroll in 2024, our team is ready to help. Get in touch with us today to ensure your HR processes align with the latest employment regulations in the Netherlands.
