The thresholds
| Employees | Obligation |
|---|---|
| Fewer than 10 | Voluntary staff consultation |
| 10 to 49 | Staff meeting (personeelsvergadering) at least twice a year, or a staff representation on request |
| 50 or more | Works council, with advice and consent rights |
Everyone working in the company counts, and agency workers count after a qualifying period. From fifty employees, the obligation applies automatically, regardless of whether employees ask for it.
Advice rights on major decisions
The works council advises on major business decisions before they are taken. These include a transfer of control, a merger or acquisition, and the closure or relocation of an operation. They also include a large reduction or expansion of activities and a big change in the organisation. A major investment and the appointment or dismissal of a director are also on the list.
The timing is important. You request advice at a point where the works council can still influence the decision, before the decision is made. If you depart from the advice, the decision is put on hold for a month. The works council can then bring the case to the Enterprise Chamber of the Amsterdam Court of Appeal. That court can order the employer to withdraw the decision.
For a foreign parent planning a Dutch reorganisation, the process starts earlier and takes longer than in most other countries.
Consent rights on personnel schemes
On personnel schemes, the works council has a consent right. This is stronger than an advice right. The list includes pension arrangements, working time and holiday schemes, remuneration and job classification systems, and health and safety policy. It also includes recruitment and dismissal policy, appraisal systems, and rules on processing employee personal data.
If you introduce or change a scheme before the works council consents, the scheme is voidable. An employee can challenge it on that basis. If the works council withholds consent, you can apply to the subdistrict court for substitute authorisation. This takes time.
Establishing one in practice
The employer organises the elections. The size of the council depends on the number of employees. For a company with 50 to 99 people, the law sets five members. With the employer’s consent, the council can set a different number in its rules. Members get time and training at the employer’s expense and are protected against dismissal. They meet the employer for consultation at least twice a year.
If few employees want to stand for election, the obligation to set up the council remains. The employer must make a real effort. Keep a record of that effort, in case the question comes up later.
You set the salary once. The payroll has to be done every month. See what we take over each month on payroll and administration for a Dutch BV.
Working well with the works council
Some companies treat the works council as a partner in decisions. If they submit advice requests early and explain their reasons, they get advice faster and with fewer conditions. Companies that present a finished decision for formal approval more often face the suspension period, and sometimes the Enterprise Chamber.
The consent right also relates to other employer duties. Pension arrangements need consent, which is relevant for the pension obligation. Dismissal policy also needs consent, which is relevant when dismissing an employee. If a collective labour agreement already regulates a subject, the consent right on that subject lapses.