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Netherlands PEO: Benefits & Best Services in 2024

VERDICT: The No. 1 Netherlands PEO in 2024 is Horizons. With dedicated local hiring support in-country, and a strong reputation for PEO services across Europe, Horizons can set up your Netherlands team within days. 

Key Takeaways

  • Netherlands PEOs facilitate easier market entry in the Netherlands for international companies.
  • They manage complex legal and HR-related tasks, allowing businesses to focus on growth.
  • The top 5 Netherlands PEOs in 2024 are Horizons, ThisWorks, AgilityEOR, Remote and Deel

The Netherlands is well-known for its highly-skilled workforce, partly due to the 30 percent tax ruling which makes it an attractive location for expat professionals looking for a European base. 

But securing top talent in the Netherlands doesn’t need to be difficult. Read on to find out how a Netherlands Professional Employer Organization (PEO) can help you hire in the Netherlands quickly, and at low cost. 

What Is a Netherlands PEO?

Netherlands PEOs provide comprehensive HR solutions to companies looking to expand their business into the Dutch market without establishing a local entity.

Professional Employment Organization (PEO) acts as a co-employer to clients’ employees, offering a suite of human resource services, including payroll administrationtax compliance, and employment benefits. In the Netherlands, a PEO enables businesses to legally hire local and international talent, navigating through the complexities of Dutch labor laws and regulations.

Top 5 Netherlands PEOs

The leading Netherlands PEOs in 2024 are:

  1. Horizons: With Horizons, global companies can hire in 180+ countries, including the Netherlands through their intuitive SaaS platform. With Netherlands-based hiring support on hand at any time of day, Horizons can quickly fix any issues that may arise in your Netherlands expansion.
  2. ThisWorks: ThisWorks is an international PEO with an especially strong presence in the Netherlands and Germany. As well as hiring and paying your Netherlands-based team, ThisWorks can also support your company with its ‘subsidiary-as-a-service’ offering if you wish to transition to a full legal entity in the Netherlands. 
  3. AgilityEOR: AgilityEOR (Agility) is an international PEO with a range of hiring solutions in the Netherlands, including payroll and staffing solutions. Agility prides itself on a people-centred approach to PEO, placing a special emphasis on customer service. 
  4. Remote: Remote is a market-leader in the PEO industry with its network of wholly-owned infrastructure. Remote is especially useful for any company expanding into the Netherlands seeking compliance assurance.
  5. Deel: Deel is an international HR platform, providing PEO, EOR and global mobility services in the Netherlands and throughout the world. Deel is especially useful for any company wanting to take advantage of its extensive platform integrations.

 

Legal Framework for Dutch PEOs

Perhaps the most important duty of a Netherlands PEO is ensuring full compliance with Dutch employment laws and regulations.

1. Dutch Employment Contracts

Dutch employment law is prescriptive, requiring employment contracts to be detailed and comprehensive. Some of the most important elements that must be specified in the contract include:

  1. The nature of the labor contract. This includes specifying whether it is a fixed term contract or ongoing , and whether there is a probation period.
  2. Working hours. This includes setting out regular hours, the maximum working hours and any overtime provisions.
  3. Leave. This covers public holiday, paid vacation leave, any other paid leave (including paid sick leave), as well as unpaid leave entitlements.
  4. Employee benefits. This includes mandatory benefits under the law,  health insurance provisions and any terms mandated by a collective labor agreement.
  5. Termination processes. This includes fair process requirements and any severance pay.

2. Dutch Labor Law Compliance

In addition to contractual requirements, PEOs must ensure compliance with Dutch labor regulations and tax laws, including the Dutch Civil Code. This includes:

  1. Proper registration of employees.
  2. Adherence to the minimum wage laws.
  3. Adherence to parental leave provisions. After a child’s birth, both maternity leave and paternity leave entitlements apply.
  4. Administration of social insurance contributions. This includes Dutch National Insurance, unemployment insurance and old age pension requirements. These contributions are part of Netherlands payroll taxes.

Non-compliance can result in significant fines and other legal issues for both the PEO and the client company. Additionally, changes in legislation, such as updates to the minimum wage or the Working Conditions Act, require PEOs to continuously update their policies and procedures.

The Netherlands Employee Insurance Agency, a government agency, ensures full compliance with these provisions. Non-profits such as Fair Work also ensure compliance with key labor law requirements. 

Video: Fair Work Netherlands Ensures Labor Law Compliance

What Are the Benefits of Using a PEO

Professional Employer Organizations (PEO) offer tailored HR solutions that can improve the efficiency and growth potential of businesses operating in the Netherlands .

For Employers

  1. Streamlined HR and Payroll Processes: Employers gain the advantage of simplified administrative operations, with the PEO handling various HR services like payroll, tax filings, and employee benefits administration. This service is particularly valuable in the context of PEO Netherlands, where local compliance is managed by the PEO, reducing the risk of legal or financial discrepancies.
  2. Cost Reduction: By leveraging economies of scale, a PEO can provide small to medium-sized businesses access to better rates on health insurance and other benefits, often leading to considerable cost savings.
  3. Focus on Core Business: With the administrative burden managed by a PEO, employers can focus on their core competencies, innovate, and drive business growth.

For Employees

  1. Access to Extensive Benefits: Employees typically receive access to a broader range of benefits, including health, dental, and retirement plans, which might otherwise be unattainable in small businesses. International PEO setups particularly benefit employees working across borders, offering consistent and competitive benefits packages.
  2. Job Security and Assistance: The co-employment model of a PEO provides additional job security to employees and assistance with HR-related queries, fostering a stable work environment.

What does a PEO do?

When engaging with a PEO in the Netherlands, businesses can streamline their operations significantly. We set out their key activities below:

1. Payroll Management

PEO services in the Netherlands ensure that payroll management is handled with precision. They manage not only the calculation of employee wages and salaries but also the distribution of payments in accordance with local labor laws. Compliance with wage regulations and timely payroll processing are both critical, as the PEO in the Netherlands.

2. Benefits Administration

Dutch PEOs coordinate various employee benefits, such as health insurance, retirement plans, and vacation days, in line with Dutch employment standards. This guarantees that foreign companies provide competitive and compliant benefits packages.

3. Tax Handling

Tax handling is a complex element of operating in a foreign country, but PEOs in the Netherlands handle this with ease. They manage the calculation, withholding, and submission of employee-related taxes to the appropriate authorities. This includes income tax and social security contributions, ensuring full compliance with Dutch tax legislation.

Choosing a Netherlands PEO Provider

When selecting a PEO provider in the Netherlands, businesses must focus on compliance, efficiency, and expertise to ensure successful HR outsourcing.

1. Selection Criteria

Compliance: The chosen PEO provider must adhere to Dutch labor laws and regulations. Reviewing providers for compliance can reassure companies that they will receive compliant HR outsourcing services, allowing them to employ workers in the Netherlands within a short timeframe.

Local Expertise: A PEO provider with a deep understanding of the local Dutch market and employment practices can be invaluable. For example, Horizons is recognized for their established presence in the Netherlands and their capacity to service even Fortune 500 companies.

Service Range: Businesses should evaluate the breadth of services offered, ensuring the PEO covers essential HR responsibilities, from payroll to employee benefits and beyond.

Reputation and Reliability: It’s vital to consider the track record and reviews of the PEO provider to gauge their reliability and the quality of service they provide.

2. Evaluation Process

Ask for References: Inquire about other international businesses that have used their services to understand real-world experiences and outcomes.

Assess Communication: Effective communication is crucial. Companies must ensure that the PEO provider can offer clear and timely interactions.

Check for Flexibility: The provider’s ability to adapt to the changing needs of a business can be a deciding factor. This is especially important for organizations looking at potential growth or changes in the Dutch market.

Review Contracts: Thoroughly review all contract terms, paying special attention to clauses about the termination of services to avoid any potential issues down the line.

Expand into the Netherlands through PEO Services

For companies looking to hire top Netherlands talent, setting up a local entity or subsidiary can be an expensive, and unnecessary undertaking. By using a Netherlands PEO, global companies can outsource the hardest parts of HR and payroll, enabling them to focus on core business.

If you are considering engaging a Netherlands PEO, our pick for the top 5 are Horizons, ThisWorks, AgilityEOR, Remote and Deel

FAQ

A Dutch PEO operates as your co-employer in the Netherlands. They handle payroll and HR compliance, leaving you to focus on core business. 

A Netherlands PEO can save your business money by performing HR and payroll tasks more efficiently than you could with an in-house team. 

A Netherlands PEO acts as the co-employer of your Dutch workforce, whereas a Netherlands Employer of Record (EOR) becomes the legal employer of your Dutch team. Often, these terms are used interchangeably. 

Travis is a global business development advisor. He has spent the last 14 years supporting business establishment and development in North America, Southeast Asia, and throughout the world. With multiple degrees from the University of Oregon, Travis currently splits his time between the US, and Bali, Indonesia. At RemotePad, Travis writes about remote work, hiring internationally and PEO/EOR business models.

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