Minimum Wage in Netherland - Frequently Asked Questions

Is there a separate legislation relating to minimum wages in Netherlands?

Yes there is separate legislation relating to minimum wages in the Netherlands. The gross minimum wage rates are stipulated in the provisions of the Minimum Wage and Minimum Holiday Allowance Act. All minimum wages showed on WageIndicator are gross rates. The wages of youth workers is governed by the Decree concerning minimum wages for youth workers of 29 June 1983 (Besluit Minimumjeugdloonregeling), as amended to 20 July 2012.

Do one or more minimum wages exist that is/are determined by law?

There is more than one Minimum Wage in the Netherlands.

At what is minimum wage determined at?

Minimum Wage is determined at a national level. When you are in the age of 15-22, you get a minimum wage for the youth. Youth workers between 15 and 22 years old receive a % of the adult minimum wage rate, which is fixed as follows: Workers of 22 years old shall be entitled to 85%; Workers of 21 years old shall be entitled to 72,5%; Workers of 20 years old shall be entitled to 61,5%; Workers of 19 years old shall be entitled to 52,5%; Workers of 18 years old shall be entitled to 45,5%; Workers of 17 years old shall be entitled to 39,5%; Workers of 16 years old shall be entitled to 34,5%; Workers of 15 years old shall be entitled to 30%.

On what basis is minimum wage calculated?

Minimum Wages is calculated on daily, weekly and monthly basis.

In case of weekly/monthly minimum age, are they based on any fixed number of hours?

The rates as set for the statutory minimum wage are based on a full working week. This usually is 36, 38 or 40 hours a week and it depends in what sector one works. Hardly 36 hours (this working week is negotiated in collective agreements). In most cases when the statutory minimum wage is paid it is a 40 hours working week, sometimes even more. Hotel & catering, as well as retail: 38 hours.

Are governmental bodies, employer and/or trade union representatives involved in minimum wages setting?

Ministry of Social Affairs & Employment is involved in minimum wage setting.

How are upratings (adjustments) of minimum wage/s decided upon?

Adjustment in minimum wages is unilaterally decided by the government on the basis of the average wage development in collective agreements.

Which are the components of minimum wage in Netherlands?

Statutory Minimum Wage includes everything, except for statutory holiday allowance (8%).

How frequently is the fixed component of minimum wage updated?

Fixed component of minimum wages is updated every half year (January 1 and July 1).

What is/are the yardstick/s on which minimum wage upratings are based?

Uprating in minimum wage is based on wage indexation.

What is the national poverty line? (In national currency)

In the Netherlands there is no ‘official’ definition for the national poverty line. However, the CBS bases the poverty line on the low-income barrier. This net amount of social assistance for a couple is € 1320.09 per month (+ € 69.48 holiday allowance). For single parents this net amount per month is € 924.07 + € 48.64 holiday allowance.

How often is poverty line updated?

Poverty line is updated twice a year in January and July.

When was poverty line last updated? (Specify YYYY/MM)

Poverty line was last updated in January 2016.

What is the percentage of minimum wage relative to the current poverty line?

The minimum wage is 100% of the social assistance norm for a family per month. For a single parent this is 70% of the minimum wage. For a single person this is 50% of the minimum wage.

What is the incidence of minimum wages(s) in the national labour force (wage earners only)?

To be answered at a later stage.

How is minimum wages compliance regulated?

Minimum Wage compliance is regulated by labour manpower office.

Which legal sanctions can be applied in compliance is lacking?

The amount of the fine depends on how much the paid wage differs from the legal minimum wage and the legal minimum holiday-allowance. The fine can be as high as € 10.000 per employee and a max. of € 2.000 when paying below the minimum holiday-allowance. After the fine the employer has to pay the arrears within 4 weeks, if not they will get a penalty of € 500 a day, with a maximum of € 40.000.

To whom/Where can individuals complain, if they think they are earning less than minimum wage?

Employers and/or trade union representatives are not involved in compliance procedure. Which month of the year is minimum wage rate revised in Netherlands? -- Minimum wage in Netherlands gets revised in January and July every year.

Are sanctions often being applied?

The sanctions are applied sometimes.