Equal pay for agency workers also includes bonuses

Right to equal treatment

Workers assigned to third parties, including temporary agency workers, are entitled to receive at least the same essential employment conditions as employees in equivalent or similar positions within the company where the temporary worker is employed. This is stipulated in the Waadi (Dutch placement of personnel by intermediaries act), which covers, among other things, wages and other allowances that must be paid to the hired worker for performing equivalent or comparable work. In case law has, there has been varying interpretation of what “wages” as per the Waadi include. The Supreme Court has now provided clarity on this matter.

Supreme Court Ruling

The case involves an employee who, via the agency Dosign, was working at AkzoNobel (Akzo) as a junior process engineer. Parties agreed that the contract between them was an agency agreement ("uitzendovereenkomst") within the meaning of section 7:690 of the Dutch Civil Code.The question before the Supreme Court was whether an agency worker could claim entitlement to the performance-based bonus, a productivity allowance, and the "Akzo bonus", which Akzo employees in similar positions were entitled to receive. The Supreme Court established that the principle of equal treatment in the Waadi is grounded in the European Temporary Agency Work Directive and must be interpreted in line with European case law. This means that the definition of wages in the Waadi must be interpreted broadly, according to the Supreme Court. The term includes all current or future benefits, whether monetary or in kind, granted to an employee based on the employment contract. The Supreme Court found that it is irrelevant whether these benefits arise from law or are granted voluntarily. As a result, the Supreme Court concluded that the hired employee, just like Akzo's own employees in equal or similar positions, is entitled to payment of the performance-based bonus, productivity allowance, and the Akzo bonus.

Is a deviating pay for temporary agency workers under a CLA still permissible?

Under the Waadi, it is possible to agree on a more limited wage concept within CLA’s (collective labour agreement). This is (a.o.) the case in the two temporary employment CLA's of the ABU and the NBBU. However, questions arise as to the implications of the Supreme Court’s ruling for this possibility of CLA deviations, considering the broad interpretation of the equal pay concept. Notably, the legislative proposal Improving security for flexible workers (“Wet verbetering zekerheid flexibele arbeidskrachten”) extends the obligation to equal treatment of temporary agency workers to all employment conditions, rather than being limited to essential employment conditions. Although it remains possible to deviate by CLA under this legislative proposal, it can only be included in the collective labour agreement of the lending agency. Also, the total employment package stipulated by the Waadi must at least be equivalent in value. Any deviation from a wage element must be compensated within the total package of wages and other benefits; it cannot be offset against “other (non-wage)" employment condition. Conversely, non-wage conditions may be offset by wages, as long as an equivalent level is maintained.

The legislative proposal is still in an early stage and is currently under consideration by the Council of State ("Raad van State"). The recent Dosign ruling by the Supreme Court will undoubtedly be taken into account in this evaluation.

We will, of course, closely monitor these developments and keep you informed as more becomes known about the status of the legislative proposal.

Hanneke Klinckhamers and Floris Meinardi

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