Introduction
The Netherlands has a unique obligation within Europe: employers are required to continue paying wages for up to two years in the event of illness. This imposes significant financial risks on employers, especially compared to other European countries where the obligation is much shorter or less stringent. This blog explains why the Netherlands differs so significantly in this regard and what the consequences are.
The Netherlands Leads the Way in Continued Pay During Sick Leave
Many business owners think twice before hiring permanent employees. This is entirely due to the obligation to continue paying their salary for two years in the event of illness. When you compare this to other European countries, it’s immediately apparent that the Netherlands is significantly out of step in this regard.
In countries such as Scandinavia, the obligation to continue paying wages lasts approximately 14 days. In Belgium, it’s two to four weeks; in Germany, six weeks. England is an exception: although you receive continued pay for 28 weeks there, it amounts to only a small benefit of about 100 euros per month. In the Netherlands, employers are required to continue paying 70% to 100% of the employee’s last earned wage for as long as two years. No other European country imposes such a heavy obligation on employers.
Implications for Employers
The requirement to continue paying wages for two years makes hiring employees risky, especially for small businesses. Employers are also responsible for the reintegration of employees on sick leave. They must offer suitable work, conduct regular evaluations, and comply with various administrative requirements.
If something goes wrong during the reintegration process, the UWV may impose a wage penalty. This means that the employer must continue to pay the employee’s wages for a third year. The costs and risks can quickly add up. And although it is possible to purchase absenteeism insurance, the premiums are high, especially for smaller business owners.
Furthermore, unfortunately, the system is also being abused. Not every sick leave request is equally justified, and employers have only limited options for taking effective action against this without incurring legal risks.
A Brake on Permanent Employment Contracts
Given the long period during which wages must continue to be paid, it is understandable that many employers opt for flexible workers or self-employed individuals rather than salaried employees. After all, the risk of an employee being absent for an extended period can have disastrous financial consequences for small businesses.
If lawmakers are serious about reducing the number of flex workers and self-employed individuals without employees, it makes sense to shorten the duration of the obligation to continue paying wages during sick leave. A shorter period would significantly reduce the risks for employers and make it more attractive to hire people on a permanent basis.
Conclusion
The long-term obligation to continue paying wages in the event of illness makes hiring employees risky, especially for small employers. This contributes to the popularity of flexible employment arrangements. Shortening the period of continued wage payments would limit the risks and could make permanent employment contracts more attractive. A revision of the rules therefore seems necessary.
This blog was written by Stijn Blom, Esq., an employment law attorney at Arbeidsadvocaat.nl B.V. Stijn has extensive experience in employment law and assists business owners on a daily basis with a wide range of employment law issues. From dismissal cases to drafting watertight contracts and policies—with his practical and personalized approach, he helps employers and employees move forward. Want to learn more? Visit Stijn’s page.
Arbeidsadvocaat.nl is happy to assist you if you have any questions about continued pay during sick leave. Please feel free to contact us .
April 2025