The Netherlands sets a monthly minimum wage of €2,069.9 (income tax is still not deducted from this amount) for full-time employees aged 21 and over. This is a baseline figure, and employees younger than 21 have a lower minimum wage.
In a major shift, the Dutch government implemented an hourly minimum wage in 2024. As of January 2024, the hourly minimum wage for employees aged 21 and over is €13.27.
This simplifies calculations and ensures fair pay for all employees. Previously, those working 36 hours a week earned the same monthly minimum wage as those working 40 hours, depending on the industry. The government takes a strong stance, levying hefty fines on employers who violate these regulations.
This article will provide you with a thorough exploration of the current Netherlands minimum wage system. By dissecting it into details, you’ll gain a comprehensive understanding of how the Netherlands ensures fair compensation for its workforce.
The Current Minimum Wage in the Netherlands
The Netherlands doesn’t have a one-size-fits-all approach to work weeks. Meaning that working hours significantly vary by industry in a range from 36 to 40 hours. A worker in a supermarket typically works a 40-hour week, while a worker in hospitality, in most cases, works 36 hours.
This is the main reason why the Dutch government obliged employers to embrace an hourly minimum wage. The hourly minimum wage before tax, as of January 2024, for employees aged 21 and over is €13.27. The Netherlands boasts one of the highest minimum wages as well as the highest average salary in the EU. However, keep in mind that both the average and minimum hourly wage depend on industry, experience, and age.
Also, the Dutch government re-evaluates and adjusts the minimum wage every six months in January and July.
How Does Minimum Wage Work in the Netherlands?
The law is the same for all Dutch workers; if you are aged between 21 and the state pension age, you are entitled to the statutory minimum wage, even if you work part-time or on a temporary contract. On the other hand, young people (15–20) will earn a specific youth minimum wage. This ensures fair compensation and protects against underpayment.
It is important to understand that the legal minimum wage depends on various factors, such as:
- Age
- Number of hours worked
- Did you agree on a weekly or monthly salary?
- Bonus, overtime, and shift allowance
Minimum Wage Per Age System
The Netherlands implements a statutory minimum wage system tied to an employee’s age. This system dictates a gradual increase in the minimum hourly wage as workers grow older and gain experience. It applies to all workers in the country, regardless of nationality.
However, employers have full flexibility. While they can legally pay lower wages to those under 21, they can also offer them the full minimum wage or even higher salaries. The minimum wage per age system encourages employee loyalty within companies by prioritising rewarding older, more experienced workers.
| Age | Per Hour | Gross Income Per Month | Net Income Per Month |
| 15 years | €3.98 | €689.81 | €433 |
| 16 years | €4.58 | €793.81 | €499 |
| 17 years | €5.24 | €908.20 | €571 |
| 18 years | €6.64 | €1.150.84 | €723 |
| 19 years | €7.96 | €1.397.63 | €886 |
| 20 years | €10.62 | €1.840.66 | €1.157 |
| 21 years and over | €13.27 | €2.299.96 | €1,446 |
Your Salary Based on Number of Working Hours
Your monthly salary hinges on your official working hours, not just the hours you physically work. This includes:
- Clocked hours – The time you spend performing your duties.
- Paid leave – Holiday leave or sick leave (for which you receive compensation).
These factors can cause your official working hours to fluctuate since some months have more workdays than others. Let’s see how the minimum wage translates to real earnings.
Imagine you’re a 38-year-old working part-time, 3 days a week (24 hours per week in total) and you earn the minimum wage. Here’s how your salary breaks down for May 2024:
- Total hours worked – clocked in for a total of 112 hours (across 5 weeks).
- Minimum wage – If you’re over 21, you qualify for the standard minimum wage of €13.27 per hour.
- Monthly earnings – Multiply your total hours by the minimum wage (112 hours x €13.27). This gives you €1,486.24 for May.
This is a simplified example, and your actual paycheck might differ based on factors like public holidays or sick leave, which would still count as paid hours.
If you and your employer agree on a set number of weekly hours, you can negotiate a fixed monthly salary. This salary reflects the average number of hours you work throughout the year.
If you were at least a 21-year-old employee working full-time (40-hour week) and earning the minimum wage, this is how your fixed monthly salary could be calculated:
- Yearly working hours – Here we consider holidays, vacations, and sick leave. A realistic estimate is to multiply your weekly hours by the number of working weeks in a typical calendar year, which is around 52 weeks. This gives us approximately 2,080 working hours (40 hours/week x 52 weeks/year).
- Minimum wage – You’re over 21 so you qualify for the standard minimum wage of €13.27 per hour.
- Fixed monthly salary – Divide your total yearly working hours by 12 months and then multiply by the minimum wage: 2,080 hours / 12 months x €13.27/hour = €2,309.40.
Remember, your actual fixed monthly salary might vary based on how your employer handles public holidays and paid leave.
Did You Sign Weekly or Monthly Employment Agreement?
In the Netherlands, a fixed monthly salary is specified in a wide variety of employment agreements. This is especially common for full-time positions where working hours are consistent throughout the year. This simplifies budgeting and provides financial stability for employees.
However, there are also other pay structures:
- Hourly wage – This is more common for part-time workers or those with unpredictable schedules. You are paid based on the total number of hours you work each month. Multiply them with your hourly minimum wage or a negotiated rate.
- Collective Bargaining Agreements (CAOs) – These agreements are established between unions and employer organisations in specific sectors. They outline different pay structures, including bonuses, shift allowances, or other benefits on top of the minimum wage.
Various factors affect whether your pay will be a fixed monthly salary or an hourly wage. Those are:
- Work schedule – Consistent weekly hours favour a fixed salary, on the other hand, variable schedules, like shift work, make hourly pay more suitable.
- Industry – In some industries, like construction, where you have more project-based work, hourly pay makes more sense.
- Negotiation – In the end, the pay structure mainly depends on the negotiation between you and your employer.
Make sure you understand the pay structure you are being offered before signing any agreement. If your offer is based on an hourly minimum wage, ask about average working hours and how overtime is compensated. If you are offered a fixed monthly salary, ask about how fluctuations in working hours (like public holidays) might affect your pay.
Understanding Compensation Beyond Minimum Wage – Bonus, Overtime and Shift Allowance
While the Netherlands has a set minimum wage adjusted twice a year, other forms of compensation can vary depending on your employment situation. Overtime, bonuses, and shift allowances are more flexible.
Their details depend on specific agreements outlined in your contract or industry CAO. Here’s a simple breakdown.
Overtime
The Netherlands prioritises work-life balance. This means that extensive overtime isn’t as common as in some other countries. However, there are situations where you might work extra hours if you need to.
- There’s no mandated minimum rate for overtime pay. However, it is typically a percentage (50% to 100%) of your regular pay.
- Your contract or industry’s Collective Bargaining Agreement (CAO) determines the amount you receive.
- The Working Hours Act limits working hours, including overtime. A maximum of 12 hours per day or 60 hours per week are allowed.
- Employers risk higher unemployment contributions for exceeding a 30% average overtime rate.
Bonuses
The Netherlands doesn’t guarantee bonuses as part of your compensation package like some other European countries. That’s why you should refer to your employment contract or consult with HR to understand if bonuses are offered and how they’re determined.
- Not mandatory, bonuses are offered at the employer’s discretion based on performance, company goals, 13-month salary, or contractual agreements.
- They’re typically added to your monthly salary and taxed accordingly (in many cases, a higher tax bracket is applied to the bonus).
Shift Allowances
Employers in the Netherlands recognise the challenges of working outside standard hours. Shift allowances are higher for the most disruptive shifts, since this reflects the greater impact on your personal life.
- Some employers offer extra pay for working outside standard hours (evenings, weekends, and nights).
- The amount is not set by law; in fact, it is negotiated in your employment contract or Collective Bargaining Agreement (CAO).
- These allowances compensate for disrupted schedules and might vary based on the specific shift (night shifts often have higher allowances).
Gross Salary and Net Income in the Netherlands
Ever wondered why your paycheck seems lower than your agreed-upon salary? It all comes down to understanding the difference between gross salary (bruto) and net salary (netto).
Gross salary is the higher number. This is the total amount of money based on your agreed-upon wage before taxes and deductions are taken out. Think of it as your pre-tax income.
Net salary is the difference between the lower amount and the actual amount that you’ll receive in your bank account. It’s the gross salary minus taxes, social security contributions, and any other deductions. This is the amount you can realistically budget for.
Minimum Salary Calculation
Calculating your exact net pay from your gross pay in the Netherlands can be a quite complex task if you don’t have some basic understanding of how the Dutch wage system works. Here are some main factors you need to take into consideration:
- Progressive tax system – The percentage of tax you pay increases as your income rises. You will be taxed at 37.07% if your average yearly salary is less than €75,518. Everything above that amount is taxed at 49.50%.
- Social Security contributions – These are mandatory deductions for social security programmes such as healthcare and unemployment benefits.
- Additional deductions – There might be additional deductions for things like insurance, private pensions, or union fees.
Let’s do some estimated net calculations so you’ll understand better. Assume a flat tax rate of 37.07% and a gross wage of €2.500.
€2.500 x 37.07% = €926.75
After the tax is deducted, your net pay will be around €1.573.25.
Use online salary calculators offered by the government or reputable financial institutions for a more accurate estimate. Here are some options:
How Does a 4-Day Work Week Affect the Dutch Minimum Wage?
Did you know that the Netherlands boasts one of the shortest average workweeks in the world? Traditionally, full-time work in the Netherlands ranges from 36 to 40 hours per week.
However, the standard can differ by industry; as we already mentioned, a supermarket worker works a standard 40 hours per week, while employees in hospitality usually work 36 or 38 hours per week.
The Netherlands is a leader in adopting the 4-day workweek model. A lot of companies are experimenting with this approach. This allows employees to condense their work into four longer working days while maintaining their total working hours. In most cases, you’ll maintain the same pay despite having fewer working days.
Salaries and Wages for Expats in the Netherlands
The Netherlands offers equal standards for everyone – the statutory minimum wage applies to all employees, regardless of nationality. This ensures fair compensation for everyone.
The good news is that for highly-skilled migrants, there’s an additional perk: the 30% rule for expats. This tax break allows foreign employees a significant income tax reduction for the first five years of employment in the Netherlands. This programme attracts international experts by offering them a financial advantage during their initial years in the country.
Ensuring transparency and preventing exploitation is one of the key aspects of the Dutch minimum wage system. Wage in the Netherlands is by law exclusively paid through bank transfers. This way, it leaves a clear record of the transaction, protecting both the employee and the employer.
Moreover, holiday allowance payments (8% of gross wage), which are a legal entitlement, must be included in these bank transfers. This allowance helps you cover expenses during your vacation time. By requiring all payments to be made electronically, the government protects your rights and ensures you receive full compensation.
Final Thoughts
Finally, how much you earn in the Netherlands depends on your gender, age, education level, experience, and the sector you work in. This article unpacked the intricacies of the Dutch minimum wage system, offering valuable insights for both workers and employers.Are you ready to leverage your skills and find a rewarding opportunity in the Netherlands? Register on Robin today! We connect talented individuals with top employers offering competitive salaries and excellent benefits. Explore exciting jobs and take the first step towards your Dutch dream career!
