Secondment abroad and cross-border work

Most issues involving social security in cross-border work situations are covered by European Union regulations (EC Regulation 1408/71). Additionally the Netherlands has separate agreements with many countries. One of the purposes of such agreements is to prevent you from being covered by more than one social security system or none at all when you work or have a business abroad. As a rule, the social security system of the country in which you work is the one that applies to you. However, there are a number of exceptions to this rule. For example, other rules apply if an employer sends an employee to work abroad temporarily (secondment) or if an employee works in two or more countries.

 

The EC regulation 1408/71 applies to the countries of the EU and EEA countries. The countries with which the Netherlands has a social security agreement can be found here.

 

International secondment temporarily

If your employee is going to work for you outside the Netherlands temporarily, this is referred to as secondment. Your employee will usually remain insured in the Netherlands under the AOW (Dutch state pension) scheme and other social insurance schemes, and you will continue to pay social insurance contributions for your employee to the Dutch Tax Administration.

 

The E101 certificate

E101 is the name of a certificate that is used by all countries of the European Union. With this certificate, an employee who works for you outside the Netherlands can prove that he or she is covered under Dutch social insurance legislation for e.g. old age pension, child benefit and unemployment. Each country has the certificate in its own language.  

  • In many countries, labour inspectorates will check whether your employee is insured for social security purposes. The company your employee is going to work for may also carry out this check.
  • By showing form E101, your employee can prove that he or she is insured in the Netherlands.  
  • If your employee does not have an E101 form, he or she may get a fine from the inspectorate. In some countries, it is even illegal for an employee to work for certain companies without having an E101 certificate.  
  • Maximum term of secondment is 5 years. Your employee can be seconded for up to five years. 
  • If your employee is going to work outside the Netherlands for more than one year, you will receive the certificate within 3 months. In that case, additional information will be needed to determine whether your employee can be seconded. The rules differ between countries. 

International secondment permanently

If your employee is going to work for you outside the Netherlands permanently, his or her insurance in the Netherlands will stop. Instead, your employee will be insured in the country where he or she is going to work, and you will have to pay social insurance contributions for your employee in that country.

 

Register your company in the country where your employee is working If your employee is going to work for you outside the Netherlands permanently, it is important that you register as an employer in that country. Your employee will not be able to get a pension or benefit in that country unless your company is registered there.

 

Cross-border workers

If your employee starts working in more than one country of the European Union (EU), he or she will be covered by the social insurance system of the country where he or she lives, provided he or she works in that country for at least 1 day a month. If your employee does not work in his or her country of residence, he or she will be covered in the country where your company is based.

 

Working outside the Netherlands permanently

If your employee starts working outside the Netherlands permanently, he or she will cease to be insured under Dutch social insurance legislation for example, old age pension, unemployment, and incapacity for work. From then on, your employee will be insured in the country of work.

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