Setting up in the Netherlands Part 3 – How to hire employees in the Netherlands

Are you looking to start your business in the Netherlands? Hiring new employees is a crucial step to grow your business. The right talent can bring new skills, knowledge and the bandwidth needed to get the best outcome for your business. However, hiring the right people for your endeavour is not just a one-time event — it is a process.

In this article, we outline the steps your business needs to take in order to hire people in the Netherlands. This guide should help you navigate the process and seamlessly onboard the right people to your team.

Step 1: Choose a business entity

In case you missed Part 1 of this series, we touched upon Dutch business entities and how to register your business at the Dutch Tax Authority (Belastingdienst) and Dutch Chamber of Commerce (KvK). Only registered businesses are able to hire employees – since your business needs a payroll tax number in order to withhold payroll tax from an employee’s salary.

For some businesses, it may not be the most effective solution to register their business as a Dutch business entity. An alternative solution would be to outsource your payroll to a local employer like Octagon Professionals and hire the people you need under our entity. We’re also recognized by the Dutch Immigration Department (IND) as a valid employer for non-EU people – making it possible to hire almost any person you need from anywhere in the world.

Step 2: Identify your hiring needs

The next step in the hiring process is to define your business goals, current situation and roles you need to fill. Every business is unique, and you have the best understanding of which skills and types of people your business needs to grow. However, like most growing businesses, you’re probably concerned about hiring too many people or bringing on permanent staff too soon before you know you can keep them busy for the long term.

On the other hand, the people you need to hire may not accept a non-permanent position, delayed hire, or the salary package your business can afford to offer at this stage. Therefore, successfully finding this comprise is going to be the key to attracting the right type of person to apply to work at your business.

To help you understand what’s possible to offer employees in the Netherlands, we’ve included a brief list of contract types, and for which type of work these contracts are usually offered, below. If you want to learn more about the difference between employment types – we’ve written a blog post about it here.

• Fixed-term contract: This type of contract has a defined end date and is usually offered to employees who only need to be employed on a temporary basis. It is also fairly standard to offer a fixed-term contract of 1 year to new hires for permanent roles at your business.
  By the end of the contract, dismissal procedure is not required to terminate the employment. However, the employee may be offered a secondary fixed-term contract. This temporary contract can be changed into a permanent one if an employee has already received three consecutive contracts, or has worked for a maximum 36 months under fixed-term contracts.
• Permanent contract: This type of contracts – as opposed to fixed – do not have an end date. The employer can only terminate permanent contracts through mutual consent (without getting the courts involved), and employees will have to observe the pre-determined notice period.
• Zero-hour contract: This is a flexible working arrangement that can be applied for both fixed-term or permanent work agreement. There are no fixed working hours for this type of contract, and the employee only works when being called on. On-call employees are entitled to the same employment rights as other employees such as salary, leave days and vacation days. The benefits are based on the number of hours they work for you.
• Freelance contract (ZZP): Freelancer is an independent contractor who is not committed to one particular employer full-time or long-term. As an employer, you do not need to pay payroll taxes for hiring freelancers/self-employed professionals under certain conditions. However, you are required to sign an agreement that defines the working relationship with the freelancer.

Step 3: Attract the right applicants

Once you have a clear idea of the role you want to fill, it’s time to locate your next best hire. This means making sure that the job opportunity reaches the potential applicants and matches their skills, experience and expectations.

The majority of business owners admit that the ideal hire is found via their own network. When this isn’t possible – you don’t have a strong network in the Netherlands yet – the best place to start to focus your hiring efforts is online.

Online advertisements

There are many online job platforms that can bring a surge of applications. You can make listings for local job seekers in the Netherlands, and most of them are for free. Below is a list of websites to advertise jobs in the Netherlands:

• Indeed: Indeed is the number one jobs site in the Netherlands, where more than half of job-seekers are active (54%), according to Intelligent Group. Indeed is used to target both blue-collar and white-collar workers, with all types of educational background and experience.
• LinkedIn: Being the world largest professional social media network, LinkedIn is a must-have platform to connect to potential candidates. LinkedIn is predominantly used by people with higher educational background (Bachelor’s/ Master’s).
• nl: This job site is known as Monster.com in other parts of the world. This job site targets mainly Dutch-speaking job seekers.
• Glassdoor: This is one of the most popular and biggest job search websites in the world. This site allows people to rate companies on different criteria such as Benefits, Culture, Career Opportunities and Work-Life Balance. Glassdoor Netherlands mainly caters to English-speaking job seekers in the Netherlands.
• IamExpat Job Board: This job board provides expats with targeted, English-language jobs in the Netherlands. Companies and recruitment agencies use this job board to attract highly skilled internationals.
• nl: This is the official job board administered by the Dutch Government. This public employment service mainly catered to Dutch speakers and used by unemployed people on social benefits.

Outsource Recruitment Process

In the Netherlands, more than 75% of available job vacancies are owned by recruitment agencies. You can always recruit on your own, but job-seekers in the Dutch market generally expect to be approached and guided through the hiring process by a recruiter.

Outsourcing recruitment allows your company to meet the business needs, especially when the role is hard to fill due to a highly competitive job market or the scarcity of that particular set of skills. Recruitment services from Octagon Professionals can save you a considerable amount of time and hassle searching for the right talent. As a result, outsourced recruitment is a fairly common practice in the Netherlands because it can effectively reduce your company’s cost-per-hire.

Notes about hiring a non-EU employee

At Octagon, helping international businesses hire from outside the EU is our specialty. As an employer, you can hire a foreign employee in the following cases:

1. Highly skilled migrants are foreign nationals who will contribute to the knowledge-based economy in the Netherlands.
2. Individuals with a residence permit that allows them to work ‘arbeid is vrij toegestaan’ (i.e: orientation year, partner visa, permanent residence, etc)
3. Self-employed individuals who carry out the work specified on their residence permit.

To find out more about work visas in the Netherlands, read our blog: Work Visas in the Netherlands 

*In order to bring highly skilled migrants to the Netherlands, you must be registered as a recognised sponsor. Recognised sponsor status allows you to have a fast-track application procedure for the employee’s residence permit. However, the application process for recognised sponsor status is lengthy, costly, and even impossible without a viable legal entity.

In that case, Octagon Professionals can act as the employer of record and hire your highly skilled employees on your behalf. In addition, as a recognised sponsor, we can assist your employees in the immigration procedure and the 30% ruling application.

Step 4: Onboard your new hire

Once you’ve been able to find and hire the people that you need, the final step of the process is to onboard your new hire so they can get to work helping you grow your business. Aside from training the new hire for their role, there’s a long list of official administrative work needed for legality and payroll compliance. If your business chooses to outsource your payroll, the payroll provider should be able to handle the majority of these tasks.

Aside from payroll administration – there are plenty of other considerations your HR team needs to make in order to set up your new hires for success. One of our HR services at Octagon is comprehensive onboarding, where members of our HR team work onsite with a client to onboard their new hires. Here are a few of the areas we try to address in our onboarding:

• Connecting new hires with relevant colleagues
• Introducing the company and the new hire’s role
• Arranging the workplace and equipment needed by the new hire
• Organizing team-building events
• Relocation and immigration support (necessary for expats)
• Setting expectations for productivity and work
• Gathering and communicating feedback between new hire and appropriate people

Looking to expand your business and start hiring employees in the Netherlands?

Octagon Professionals has over 30 years of experience hiring talent across a wide range of functional areas. With a strategic partnership with Octagon, you don’t need to dedicate your own internal resources to go the extra mile in your hiring processes. Our expert team of HR professionals can guide you through the hiring process, and ensure your employees are perfectly compliant with Dutch market standards. Contact Octagon Professionals to successfully grow your business together with your top talent