Hiring freelancers has long been a popular option for businesses across various sectors. Freelancers provide flexibility, specialized expertise, and quick availability. However, this working relationship also raises challenges, especially when it comes to defining the line between self-employment and employment.
In 2025, the regulations surrounding the hiring of freelancers will be tightened. The proposed legislation, known as the Fixed Basic Employment Relationship Act (VBAR), aims to bring greater clarity. In this blog, we’ll explore what these changes mean for your business and how you can prepare.
What defines a freelancer?
A freelancer, or ZZP’er in Dutch, is an individual who provides services without employing others. However, if the person works alongside other employees of the same contracting party, they are considered part of a service-providing company rather than a freelancer.
In industries such as healthcare, construction, and agriculture, many freelancers function as disguised employees. They often work exclusively for one contracting party year-round, performing similar tasks to employed staff. This situation raises concerns about entrepreneurship and compliance with labor laws.
Why is change necessary?
Freelancers often lack protection against unemployment and disability, creating financial vulnerabilities. Additionally, low hourly rates make them competitors to employees, further destabilizing the labor market. Due to limited enforcement in recent years, the number of freelancers has grown significantly, leading to situations where the balance between entrepreneurship and employment becomes unclear.
What will change in 2025?
Starting in 2025, stricter enforcement on hiring freelancers will resume. The VBAR legislation will provide clearer guidelines to distinguish between self-employment and employment, using nine key criteria outlined by the Supreme Court in the Deliveroo ruling:
- Type and duration of the work.
- Who decides how and when the work is performed?
- Does the work relate to the core activities of the contracting party, and is it also performed by employees?
- Is the freelancer required to perform the work personally?
- Which party determines the contractual terms—the contractor or the freelancer?
- Is payment based on hours worked or the result of the work?
- How high is the freelancer's compensation (minimum €33 per hour)?
- Does the freelancer bear commercial risks, such as liability for damages?
- Does the freelancer behave like an entrepreneur (e.g., having a website or networking)?
How to prepare
To determine whether a working relationship qualifies as self-employment or employment, these nine criteria should be carefully evaluated. If the relationship leans towards self-employment, it’s advisable to formalize the terms in a written agreement.
For now, businesses can use the model contracts available on the Dutch Tax Authority's website. However, these will no longer be updated, so it’s important to include clear agreements about:
- Tools and materials (if applicable).
- Planning and execution of work.
- Liability for errors.
- A results-based agreement is often recommended for freelancers. Agreements based solely on hours worked can indicate an employment relationship, which should be avoided.
What this means for your business
The new regulations aim to create a fairer labor market by addressing the challenges of disguised employment. For businesses, this means taking a closer look at freelance arrangements and ensuring compliance with the updated rules.
Need support in navigating these changes? At Bol International, we’re here to help you assess your current contracts, align with the new legislation, and ensure smooth operations as you adapt to these evolving regulations.
Reach out today to learn how we can assist your business.
