[Updated 2/26/24] Mandatory employee benefits in the Netherlands include general old-age pension, surviving dependent’s pension, long-term care, child support, unemployment, work, and income protection, sick leave, and health insurance. Supplementary employee benefits include retirement, dependent’s pension, disability insurance, accident insurance, and health insurance. Perks range from transportation allowances to mobile phones to flexible leave models.

Asinta Partner
Hans Huizing

Schouten Zekerheid

More Info

Mandatory employee benefits in the Netherlands

The Dutch social security system is one of the most comprehensive in Europe.

Social security has two parts. The national insurance scheme (volksverzekeringen) and the employee insurance scheme (werknemersverzekeringen).

The national insurance schemes are: General Old Age Pensions Act (AOW), Surviving Dependents Act (ANW), Long-Term Care Act (Wlz) and Child Support (Kinderbijslag).

National insurances are due when you are:

  • Considered a resident of the Netherlands; or
  • Subject to payroll tax in the Netherlands in respect of employment carried out in the country.

National insurances are collected through the withholding of tax from the individual.

General Old Age Pensions Act (AOW)

All inhabitants of the Netherlands accrue rights to a state pension based on the General Old Age Pensions Act (AOW). The amount of this pension depends on the number of years that you live in the Netherlands prior to reaching the state retirement age. A maximum of 50 years is applied (2% of the maximum state pension amount is allocated for each year). The amount of state pension paid out also depends on whether the pensioner cohabits with anyone else. As of 2024, the gross annual amounts are:

  • State pension (AOW) for cohabiting couples (per partner): €13,224
  • State pension (AOW) for single people: €19,412

Surviving Dependents’ Pension (ANW)

All inhabitants of the Netherlands are insured for a surviving dependents’ pension based on the Surviving Dependents Act (ANW). The insured gross amount on an annual basis is €19,080 (2024). However, entitlement to this benefit depends on specific criteria. The surviving dependent must be:

  • A caregiver of children under the age of 18; or
  • Have a disability rate of at least 45%.

If the surviving dependent meets one of these criteria, an additional income test is conducted that may lead to a reduction in the benefit amount.

Long-Term Care Act (Wlz)

If inhabitants need a lot of care or support on a daily basis, for example, because of mental or physical limitations, they may qualify for care under the Dutch Long-term Care Act (Wlz). Most people who live or work in the Netherlands are automatically insured under the Wlz scheme.

Child Support (Kinderbijslag)

Child benefit is a payment to help inhabitants with the cost of caring for a child. Inhabitants can get child benefits for:

  • Their own child
  • Their partner’s or your ex-partner’s child
  • A foster child
  • A child they care for as if it was their own child

The employee insurances are the Unemployment Insurance Act (WW), Work and Income Act (WIA), and Sickness Benefits Act (ZW).

Employee insurances are due when a person is employed in the Netherlands. Employers pay the premium for employee insurance.

Unemployment Insurance Act (WW)

If employees become unemployed in the Netherlands, they can be entitled to unemployment benefits under the Unemployment Insurance Act (WW, Werkloosheidswet). The conditions for a WW benefit include the following:

  • The employee lost at least 5 work hours a week and the associated pay (for employees who are employed for a maximum of 10 hours per week, the condition is to have lost at least half of the working hours)
  • The employee is available for work in the Dutch labor market
  • The employee has worked for at least 26 weeks in the 36 weeks before he became unemployed
  • The employee has become unemployed through no fault of his own

Employees receive 75% of their last salary. The salary is capped at €71,628 (2024). One year in employment gives entitlement to one month of WW benefit receipt for the first 10 years. From the 11th year, one year of employment gives entitlement to ½ month of WW benefit (with a maximum of 24 months). If an employee does not meet the conditions to receive WW-benefit, he may qualify for social assistance benefits under certain conditions.

Work and Income Act (WIA)

Work and Income, according to Labor Capacity Act (WIA), emphasizes a partially disabled worker’s capabilities rather than what (s)he is incapable of doing. The WIA provides a benefit to disabled employees if they have a loss of salary of at least 35% for (all kinds of) acceptable employment after 104 weeks of disability. The WIA consists of two legal provisions: IVA and WGA. The WIA does not compensate for the loss of income up to 35%. As a result, disability will no longer be compensated. Loss of income from 35% up to 80% will be compensated up to a maximum of 70% of lost income for those who keep working based on their ability. Others will receive far less compensation. Only employees who are permanently disabled for more than 80% receive an income-related benefit of 75% of the income up to the age of 66 and 4 months. The maximum annual income covered under the WIA is €71,628.

Sickness Benefits Act (ZW)

The Dutch Civil Code stipulates that employers must continue to pay out the salary of sick employees for the first two years of sickness (with a minimum of 70%). After 104 weeks of sick leave, a review takes place to determine whether the employee qualifies for a disability benefit (WIA). After 104 weeks of sick leave, the employee will further be covered under the WIA if disabled for at least 35%.

The Sickness Benefits Act (ZW), although privatized, has continued to exist as a “safety net” for temp workers or employees who do not, or no longer, have an employer. Sick pay is also possible in the event of sickness resulting from pregnancy and childbirth, bankruptcy of the employer, and a few other specific circumstances. Social Security sick pay is 70% of the daily and is paid out as long as sickness continues, but for a maximum of 104 consecutive weeks. Female employees are entitled to a sick pay benefit of 100% of the salary (up to the maximum daily pay) when sickness or absence is in connection with childbirth.

Health insurance

Everyone who lives or works in the Netherlands is obliged by law to hold basic health insurance. This basic insurance covers standard care by, e.g., general practitioners, hospitals, or chemists. There is also the option of taking out voluntary supplemental insurance to cover those expenses not reimbursed by basic insurance.

Insurance companies have a duty to accept clients for basic insurance, which provides the same cover for all inhabitants. The basic insurance premium is an average of €1,752 on an annual basis. Children up to the age of 18 are exempt from this premium.  Insurers also offer supplemental insurance policies on top of basic insurance (e.g., dental insurance). The average premium for these is about €370 a year.


Supplementary employee benefits in the Netherlands

Employers may offer their employees benefits in addition to the system of social security insurance and benefits provided by the state since state benefits have restrictions such as maximum amounts or linked to specific criteria. These supplemental benefits come under the general term of employee benefits.

Retirement pension

For Dutch employers, it is crucial to determine whether they are obligated under a Collective Labor Agreement (CAO) or fall within the scope of a compulsory industry pension fund. If so, pension accrual must adhere to sectoral agreements. If not subject to a CAO or compelled to join a sectoral pension fund, employers can establish their own pension commitments.

Before the introduction of the new pension law on July 1, 2023, employers could choose between a defined benefit plan and a defined contribution plan. Since July 1, 2023, only defined contribution plans are permissible. However, the new pension law also significantly impacts the structure of the defined contribution plan.

While defined contributions in the previous system often varied with age, with premiums increasing as employees aged, contributions in the new system are age-independent (flat rate). Employers establishing new pension plans after July 1, 2023, must immediately comply with the new legislation.

The defined contribution is based on the individual employee’s salary. The AOW franchise, a minimum amount deducted from the salary (€17,545 in 2024), reduces the pensionable amount. The defined contribution is then calculated by multiplying the premium percentage by the pensionable amount. The premium percentage, determined by the employer, can reach up to 30% of the pensionable amount (fiscal maximum). Pension contributions are invested, and upon the employee’s retirement, the accrued capital is used to secure lifelong payments of retirement and partner pensions.

Pension Reform

The implementation of the new pension law on July 1, 2023, signifies a pivotal moment in the evolution of pension legislation in the Netherlands. Employers with existing pension schemes at that time have until January 1, 2028, to bring their pension plans in line with the new regulations.

Under the new system, defined contribution plans based on a fixed premium percentage will become standard. Existing defined benefit plans must undergo conversion into defined contribution plans no later than January 1, 2028. Existing defined contribution plans featuring an age-dependent premium scale may continue for current employees. This implies that even beyond January 1, 2028, employers can offer current employees (hired before December 31, 2027) the existing age-dependent premium scale, while new employees from January 1, 2028, onward must be provided with a fixed premium percentage.

It is anticipated that most employers will choose to preserve the age-dependent scale for current employees (grandfathering). Consequently, many employers are likely to operate two schemes:

A scheme for current employees (employed at the transition date to the new system) based on the existing age-dependent premium scale.

A scheme for new employees founded on a fixed premium percentage.

Another notable change is regarding the partner pension, paid to the surviving partner in case of death, which will be a percentage of the pensionable salary, irrespective of the years of service (as it currently stands). This alteration will apply to both schemes during the transition to the new system.

Dependent’s pension

Pension schemes nearly always include supplemental cover in the form of partner and orphans’ pensions. In the new system, the insured benefit is calculated as a percentage of the salary, with the employer being able to choose a percentage up to 50% of the salary. The insured amount of the partner and/or orphan’s pension is paid out in the form of an annuity. The partner’s pension has a lifelong payout. The orphan’s pension is paid out up to the age of 25 Employers may opt for a fixed benefit or one that increases.

Disability insurance

Based on the Work and Income Act (WIA), after two years of sick leave, employees may be eligible for a state disability benefit. All employees are automatically insured for the WIA. In the event of full disability, the WIA pays a benefit of at least 70% of the final income. In the event of partial disability, the benefit will usually be lower than 70% of the salary. The WIA benefit is calculated over a maximum salary (2023: €66,956).

The WGA gap insurance supplements the legal disability benefit (WIA benefit), up to 70% of the most recent salary. The benefit is based on a maximum gross annual salary of €66,956 (as of 2023) and is paid directly to the employee. The WIA surplus insurance covers 70% or 80% of the gross annual salary above €66,956 (as of 2023), and the benefits pay directly to the employee.

Accident insurance

An accident insurance policy pays out benefits in the event of an employee’s death or disability resulting from an accident.

Group health insurance

A health insurance policy covers the costs incurred by employees (and their children aged under 18 years) due to illness, such as expenses for medical care and treatment. Employees typically pay for the policy’s premium, although some employers choose to pay the premiums on behalf of their employees and sometimes for their partners as well.


Common Employee Perks

In addition to state benefits and (insured) employee benefits, employers will often provide a range of additional benefits to help recruit and retain employees. The most common fringe benefits are below:

  • Transport allowance: solely for business-related purposes up to €.23 per kilometer
  • Working from home allowance
  • Education Reimbursement:  for job-related training, in addition to providing time off to attend the course.
  • Mobile Phones/ Laptop / Company car:  based on business needs
  • Flexible working hours
  • Flexible leave models: the opportunity to buy extra holidays, extra leave arrangements, care-related leave
  • Employer-sponsored training (work-life balance, stress reduction)
  • Gym membership discounts
  • Bike plans
  • Financial support


This information about employee benefits in the Netherlands is provided by Schouten Zekerheid, Asinta’s employee benefits consulting Partner in the Netherlands.


Nothing on this country page is intended to be legal, financial, or tax advice, and readers are advised to consult with their appropriate advisors regarding any legal, financial, or tax implications this information may address.

Asinta Knowledge

Netherlands Payslips to Push Employers to Offer Pensions

Soon, Netherlands payslips will push employers to offer pensions because employers must highlight the absence of one on the payslip. A provision in recent pension... Read More

Netherlands Minimum Pension Entry Age Lowers to 18

The Netherlands passed a new pension law this year, and it came into effect on July 1, 2023, with employers having until January 1, 2028,... Read More

Netherlands Mandates Employee Involvement in Reintegration Reporting

On July 1, 2023, the Netherlands’ reintegration reporting process requires employee participation. This reporting is for employees who recovered from a lengthy illness and are... Read More

New Netherlands Pension Law Adopted

On Tuesday, May 30, 2023, the Senate adopted the new Netherlands pension law. The law comes into effect on July 1, 2023. The pension advisor... Read More

Dutch Pension Reform Approved

Dutch pension reform was solidified by the Dutch lower house of parliament on December 22, 2022. The legislation still requires approval by the upper house... Read More

Benchmarking Employee Benefits in the Netherlands 2022

Looking to begin benchmarking employee benefits in the Netherlands for 2022? Start with Asinta’s Market & Benchmark Insight Report for the Netherlands for 2022. Asinta’s... Read More

Netherlands Pension Update for 2022

The Dutch Ministry of Finance recently announced the 2022 pension scheme deductible (AOW-franchise) as well as the maximum pensionable salary. The standard deductible (AOW-franchise) for... Read More

The Netherlands Under Hard Lockdown Until January 14, 2022

On December 18, 2021, the Dutch government announced stricter measures to slow down the spread of the new Omicron variant. Most locations are closed. There is a... Read More

Dutch Pension Reform Delayed to 2023

The Netherlands government announced that Dutch pension reform is delayed to 2023. Originally slated to go into effect in January 2022, the complexity of the... Read More