Netherlands: Entrepreneurship Now a Central Test in Classifying Work Relationships
Working relationships in the Netherlands are undergoing a fundamental reclassification following a series of major legal and policy developments in early 2025. Collectively, these changes signal a decisive move by lawmakers and the courts to curb bogus self-employment and strengthen enforcement against misclassified labour arrangements.
From renewed tax enforcement to a landmark Dutch Supreme Court ruling, the definition of who qualifies as a genuine independent contractor has expanded, with entrepreneurship now standing on equal footing with authority and organisational integration.
Key Legal and Policy Developments in 2025
On 1 January 2025, the Dutch government officially lifted the long-standing enforcement moratorium under the DBA Act (Wet DBA). This move restored the authority of the Dutch Tax Authorities to actively investigate and penalise cases of pseudo self-employment.
Shortly thereafter, on 21 February 2025, the Dutch Supreme Court delivered a pivotal judgment in a dispute between a taxi company and the trade union FNV. The Court held that entrepreneurial behaviour by a worker can materially influence how a working relationship is legally classified.
Building on this decision, the government announced on 27 March 2025 that it would revise the proposed VBAR legislation (Clarification of the Assessment of Working Relationships and Legal Presumptions) to align statutory rules with the Supreme Court’s interpretation.
The combined effect of these developments is clear: external entrepreneurship is now a full and independent assessment criterion when determining whether a person is truly self-employed.
How the Supreme Court Expanded the Entrepreneurship Test
The Dutch Supreme Court has consistently maintained that employment classification must be determined through a holistic assessment of all relevant circumstances. In earlier case law, the Court emphasised factors such as:
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The degree of authority or control exercised by the client
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The level of integration into the organisation
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The presence of financial risk
However, the February 2025 ruling clarified a long-standing uncertainty: whether entrepreneurship should be evaluated only within the specific working relationship or whether external business activities also matter.
The Court ruled unequivocally that external entrepreneurial indicators are relevant, including whether the worker:
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Has multiple clients
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Is registered with the Dutch Chamber of Commerce
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Operates a business website
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Makes independent investments
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Engages in marketing or branding activities
Crucially, the Court rejected any hierarchy among the criteria. Entrepreneurship now carries the same legal weight as authority, integration, or financial dependence.
Netherlands: Practical Consequences for Employers and HR Professionals
These changes significantly widen the scope of compliance obligations for organisations engaging freelancers and contractors.
Employers must now assess not only how work is performed, but also whether the individual operates as a genuine business entity beyond the engagement itself. This requires a deeper review of business conduct, contracts, and supporting documentation.
The government has acknowledged that certain data such as VAT filings or marketing efforts may not always be accessible to clients. Nevertheless, the expectation remains that organisations take reasonable steps to form and document a well-founded assessment.
Under the revised VBAR proposal, entrepreneurship will no longer be a fallback consideration used only in borderline cases. Instead, lawmakers intend to codify the Supreme Court’s approach, making entrepreneurship a core statutory test.
Netherlands: What Organisations Should Do Now
In light of renewed enforcement and expanded legal scrutiny, Legal Linkz recommends that employers and HR professionals take proactive steps to reduce exposure:
1. Re-evaluate existing freelancer relationships
Review current contracts and assess the contractor’s entrepreneurial status. Where conclusions change, ensure the reasoning is clearly documented.
2. Strengthen contractual clarity
Use carefully drafted agreements and approved model contracts to avoid high-risk provisions such as fixed working hours, mandatory on-site presence, or hierarchical reporting lines.
3. Promote genuine independence
Structure engagements around outcomes and deliverables, not methods or schedules. Grant freelancers autonomy consistent with operating an independent business.
4. Avoid operational control
Direct instructions on working hours, tools, or location substantially increase the likelihood that the relationship will be reclassified as employment.
With enforcement back in full force and jurisprudence evolving rapidly, 2025 marks a turning point in Dutch labour classification law. Organisations that fail to adapt risk tax penalties, employment reclassification, and pension liabilities.
The message from the courts and policymakers is unambiguous: substance now outweighs form, and entrepreneurship must be demonstrable, not assumed.
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