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Key Takeaways
The Netherlands has become one of Europe’s most attractive places to hire. It consistently ranks near the top of global talent benchmarks – placing 5th worldwide in the 2025 IMD World Talent Ranking. Dutch workers are highly educated, comfortable with digital tools, and among the strongest non-native English speakers in the world – with around 90% of the population able to converse in English – making the Netherlands a natural fit for globally distributed teams across product, engineering, finance, logistics, and life sciences.
Hiring in the Netherlands is more complex than issuing an offer and running payroll. Employment law is highly protective – with mandatory pensions, up to two years of sick–leave liability, automatically applicable collective agreements, and strict termination rules – where missteps can lead to fines from roughly €300 to €15,000 per violation. As a result, many global companies use an Employer of Record (EOR) to hire compliantly.
This guide explains how Dutch EORs work, what to look for, typical costs, and the best Netherlands EOR providers for 2026.
What Is an Employer of Record And Why Does It Matter in the Netherlands?
An EOR is a company that legally employs your team on your behalf. In practice, you still hire the right person, manage their day-to-day work, set goals, and decide how the role fits into your business. The EOR acts in the background as the legal employer, handling everything that requires a local Dutch entity.
That includes (amongst other things):
- Issuing a Dutch-compliant employment contract
- Running global payroll and paying salaries on time
- Calculating and filing taxes with the Belastingdienst (Dutch Tax Authority)
- Managing mandatory pensions and social contributions
- Handling statutory benefits, holiday allowance, and sick leave
- Making sure everything complies with Dutch labour law
- Ensuring compliant terminations and offboarding
Why Does This Matter So Much In The Netherlands?
Hiring employees in the Netherlands means navigating several legal and administrative systems at once. Employment relationships are governed by the Dutch Civil Code, tax obligations run through the Belastingdienst, unemployment and disability rules involve the UWV (Uitvoeringsinstituut Werknemersverzekeringen), pensions may be mandatory depending on the role, and collective labor agreements can apply even if you didn’t actively sign one.
For foreign hires, employers must also correctly assess and administer the 30% tax ruling (expat scheme), which allows eligible employees to receive up to 30% of their gross salary tax-free – but only if strict eligibility, salary thresholds, and application timelines are met.
Missing any of these pieces can create real risk that could be avoided through a strong partnership with an EOR that’s already a local expert. You gain speed, compliance, and peace of mind, while your employee gets a fully legitimate Dutch employment experience.
Some of the most common challenges companies run into when hiring in the Netherlands include:
- Statutory holiday allowance (vakantiebijslag) of at least 8% of gross salary
- Pension participation that may be compulsory depending on role or sector
- Two years of employer responsibility for sick leave
- Automatic CAO (Collective Labor Agreement) applicability many companies miss
- Strong employee protections around contract renewals and dismissal
- Detailed payroll reporting and tax withholding rules
Add in cultural expectations – transparency, predictable benefits, and healthy work-life balance – and it becomes clear why many teams opt for an EOR rather than going it alone.
30% Tax Ruling (Expat Scheme): Key Updates as of 2026
The Dutch 30% tax ruling allows eligible foreign employees to receive a portion of their salary tax-free, making the Netherlands more attractive for international talent. However, the rules are strict and have recently changed.
- Tax-Free Allowance: Eligible employees may receive up to 30% of their gross salary tax-free through 2026
- Upcoming Change: From 1 January 2027, the maximum tax-free percentage will be reduced to 27%
- Eligibility Threshold: Employees must meet the annual taxable salary norm (commonly cited for 2026 as €48,013, indexed annually)
- Employer Responsibility: Applications must be submitted to the Belastingdienst, and eligibility, timing, and payroll setup must be handled correctly to avoid losing the benefit
Because the ruling directly affects net pay, offer competitiveness, and payroll compliance, it’s often managed by an Employer of Record (EOR) for foreign hires to ensure correct application and ongoing compliance.
What Should You Consider When Choosing an EOR in the Netherlands?
When evaluating EOR providers for the Dutch market, these are the factors that you should be using to vet your options:
- Local Compliance & Regulatory Expertise: Your provider should know Dutch compliance inside out, from labour law under the Dutch Civil Code to Belastingdienst tax rules, UWV requirements, pension obligations, and CAO (Collectieve Arbeidsovereenkomst - Collective Labour Agreement) applicability, right down to the finer details of monthly payroll.
- Wholly-Owned vs Partner Models: EORs that operate through their own Dutch entity, like Playroll, generally offer more direct control. This means fewer delays, clearer accountability, and smoother handling of contracts, payroll, pensions, and terminations when issues arise.
- On-the-Ground Presence: A real Netherlands-based team matters. Pension enrollment, sick-leave processes, CAO interpretation, and termination procedures often require hands-on local expertise rather than remote, one-size-fits-all support.
- Technology & Platform Capabilities: Look for seamless onboarding, contract management, leave tracking, expense workflows, automated payroll, and integrations with your HR and finance systems that work cleanly within Dutch requirements.
- Pricing Transparency: Ensure full clarity on EOR fees, employer taxes, pension costs, benefits, FX markups, and any onboarding or offboarding charges. In the Netherlands, hidden pension or compliance costs can significantly change the true price of hiring.
- Payroll Reliability & Accuracy: Dutch payroll leaves little room for error. Your EOR should accurately calculate payroll tax, social security, holiday allowance accrual, pension contributions, and benefits every month, and ensure employees are paid correctly and on time.
- Customer Support Responsiveness: You want an EOR that responds quickly, especially when payroll questions, pension issues, sick-leave cases, or termination processes are involved, where delays can quickly become costly.
What Does It Cost to Hire Through an EOR in the Netherlands?
Most EOR services in the Netherlands typically charge between €450 and €750 per employee per month. Where you land in that range depends on a few things – the salary level, whether a pension scheme is mandatory, if a CAO applies, and how complex the role is from a compliance point of view.
Costs can creep higher for senior positions or roles that come with more involved pension or benefits requirements.
The Best Employer of Record Providers in the Netherlands for 2026
Below is a curated list of the most relevant EOR providers for Dutch hiring today – with real strengths and honest limitations.
- Playroll: Stands out for its modern, global EOR platform combined with in-house Netherlands expertise. Unlike legacy providers that rely heavily on third parties, Playroll operates through its own Dutch entity, giving it direct oversight of all in-country employment, compliance, and payroll activity. This enables the team to confidently manage Dutch employment law, pensions, statutory holiday allowance, sick leave, and terminations with precision. Fast onboarding, transparent pricing, automated payroll, and AI-backed compliance checks are paired with highly responsive human support – and the platform’s simplicity and intuitiveness are consistently validated by strong customer reviews from both employers and employees.
- Deel: Operates through its own Dutch entity and provides compliant contracts, payroll, and benefits. Its platform is highly automated and integrates well with broader HR and finance stacks. The trade-off is that pension handling and local nuance can feel standardized, which may not suit more complex Dutch employment scenarios. On top of that, the fees are notably higher than other EOR providers with the same offering.
- Remote: Operates directly in the Netherlands and offers compliant employment, local benefits, and strong IP protection. The platform is built for consistency and ease of use across multiple countries. That consistency can come at the cost of flexibility for highly customized benefit structures or CAO-driven roles.
- G-P (Globalization Partners): An enterprise-focused EOR provider offering comprehensive compliance coverage in the Netherlands, including contracts, payroll, benefits, and terminations. It’s a strong fit for large, risk-averse organizations. For smaller or fast-moving teams, however, the pricing and process depth can feel heavy.
- Papaya Global: Combines EOR and payroll services in the Netherlands with powerful analytics, reporting, and finance-friendly workflows. It works well for teams managing complex, multi-country payroll. That being said, the EOR operates exclusively through third-party providers, meaning there are often communication delays and a lack of in-country expertise.
- Oyster HR: Supports compliant hiring in the Netherlands with transparent pricing and a remote-first approach tailored to distributed teams. It’s known for clear documentation and a clean platform experience. It’s less well suited to companies dealing with complex pension obligations or sector-specific CAOs. Oyster is additionally one of the priciest EORs on the market.
- Skuad: Provides straightforward EOR services in the Netherlands with predictable pricing and relatively fast onboarding. It’s often chosen for simplicity and speed. The limitation is reduced depth when handling edge-case compliance or advanced Dutch employment scenarios.
- Velocity Global: A long-standing EOR provider with strong compliance infrastructure in the Netherlands and experience supporting regulated industries. It prioritises stability and risk management. That strength can make processes feel more rigid and slower compared to newer, more agile platforms.
- Atlas: Employs workers directly through its own Dutch entity and focuses heavily on compliance, control, and speed of onboarding. It appeals to companies that prioritise legal certainty. The experience can feel more transactional, with less emphasis on ongoing HR advisory and employee experience.
- Safeguard Global: Delivers enterprise-grade EOR services in the Netherlands with strong HR governance, payroll reliability, and compliance oversight. It’s commonly used by large, global organisations. For startups or scale-ups, the service model may feel more traditional and less flexible.
Insights from Real Users
Playroll
I really like the customer support from Playroll. We always feel very supported and cared for. Their customer support is very efficient, and if we ever have any doubts, they answer very fast and are always available.
I also appreciate that they have lawyers available to support us with any legal matters or questions. Navigating the platform is very easy, and the user experience is smooth, which makes things simple for us.
- Verified G2 User
Papaya Global
I appreciate that it's enabled us to have a global workforce and engage people in countries where we don't have offices or a registered presence. I’m not a big fan of the reliance on third-party platforms for some regions, and it would help a lot if there were a direct way to reach the ICP when we need quick clarifications.
- Verified G2 User
Using an EOR vs Setting Up an Entity in the Netherlands
If you’re hiring your first employees in the Netherlands, one of the biggest decisions you’ll face is whether to use an Employer of Record or set up a Dutch legal entity. The right choice depends on how quickly you need to hire, how many people you plan to employ, and how much long-term presence you want in the country.
Here are some simple guidelines to help you decide based on the stage your business is in.
Use an EOR if:
- You need to hire quickly and avoid long setup timelines
- You don’t want to manage Dutch payroll, tax filings, pensions, or labour-law compliance
- You’re testing the Dutch or broader EU market
- You’re building a small initial team – typically under 15–20 employees
- You want to minimize risk around sick leave, pensions, and termination procedures
Set up a Dutch entity if:
- You’re scaling beyond 20–30 employees in the Netherlands
- You need a permanent operational presence or local infrastructure
- You want direct control over tax structuring or long-term employment strategy
- You expect to operate under a specific CAO at scale
Entity set-up costs to consider:
- Dutch entity setup: Typically €5,000–€15,000+
- Ongoing accounting, payroll, and compliance: €8,000–€20,000 per year
- Pension administration and employer contributions
- Ongoing legal support for labour law, sick leave, and terminations
For most companies making their first hires in the Netherlands, an EOR is simply the smoother and lower-risk path. Setting up a local entity comes with multiple registrations, ongoing compliance obligations, pension complexity, and long-term employment liabilities. An EOR lets you hire quickly without getting tied up in administrative groundwork.
The key is choosing a provider that operates through its own Dutch entity, such as Playroll. When your EOR has boots on the ground, everything moves more smoothly – from handling pensions and payroll to navigating sick leave or termination questions before they turn into costly problems.
Local presence ultimately means practical insight, faster resolutions, and compliance that works in real-world Dutch employment scenarios, not just on paper.
Onboarding Through an EOR in the Netherlands
Onboarding through an EOR in the Netherlands is generally straightforward. As the employer, you define the key details of the hire – including the role, compensation, start date, working hours, and any variable pay or benefits – and approve the final employment terms. Once these details are confirmed, your EOR handles the administrative and compliance work on your behalf.
The EOR collects required employee information such as identification, address, and bank details, issues a Dutch-compliant employment contract, registers the employee with the Belastingdienst, sets up payroll, enrolls the employee in any mandatory pension schemes, and activates statutory benefits. In most cases, your employee can be fully onboarded and ready to start within 2–5 business days, depending on documentation and pension requirements.
Compliance Considerations for Hiring Employees in the Netherlands
Hiring in the Netherlands means navigating detailed legal requirements alongside strong cultural expectations around fairness, transparency, and work-life balance. While some obligations depend on role or sector, the following principles apply nationwide.
Key Takeaways
Hiring in the Netherlands opens the door to a highly skilled, globally experienced talent pool, but it also comes with one of the most tightly regulated employment systems in Europe. Between pensions, long-term sick leave obligations, termination rules, and CAO compliance, growing your team can get complicated without the right local know-how.
That’s why choosing the right EOR partner really matters. If you want to hire quickly, stay compliant, and avoid surprises around payroll, taxes, or benefits, Playroll takes care of the heavy lifting for you.
Curious to see what that looks like in practice? Book a demo with our team and see why companies trust Playroll for their Netherlands expansion.


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