15-02-2012
Social Insurance Legislation - Continental Shelf

The Netherlands social insurance legislation stipulates that, with effect from 1 January 2012, all employees working in the Netherlands or on the Dutch Continental Shelf (DCS) will fall under the Dutch national insurance and employee insurance schemes and the Dutch Healthcare Insurance Act.

This means that with effect from 1 January 2012 all non-resident employees with a Dutch employer working on the DCS, usually in the oil and gas industry, will fall under the Dutch public social insurance schemes.

As the employees working on the Dutch Continental Shelf will fall under the same regulations as employees working in the Netherlands, they will be entitled to national and employee insurance coverage.  The employees will be covered by all the Dutch national insurance schemes  (General Child Benefit Act, Surviving Dependants Act, Exceptional Medical Expenses Act and the General Old-Age Pensions Act), the employee insurance schemes (Sickness Benefit Act, Unemployment Insurance Act, Work and Income (Capacity for Work) Act) and the Healthcare Insurance Act. In this respect, the Dutch Continental Shelf is understood to mean the Dutch part of the seabed and subsoil situated on or under the North Sea (outside the territorial waters). Seagoing vessels do not fall under this Act. Specific social security regulations apply to employees working  on seagoing vessels and comparable installations. 

The protection afforded to employees working on the DCS will also be increased. The Working Hours Act and the Working Conditions Act have already been expanded to include all employment on the Dutch Continental Shelf.  With the introduction of this new Act, the provisions of the Collective Agreements (Declaration of Universally Binding and Non-Binding Status) Act, Wage Formation Act, Minimum Wage and Minimum Holiday Allowance Act and the Extraordinary Labour Relations Decree 1945 will apply to all employment on the DCS. For a great many employees this new Act means that they will be obliged to pay national insurance and healthcare contributions and the employers will be obliged to pay the employee insurance and healthcare insurance contributions owing for these employees. The question now is whether non-resident employees will benefit from the accrual of, for example, a state pension in the Netherlands whilst only having worked here for short periods of time, and are not and will never become a Dutch resident.

With effect from 1 January 2012, employers must verify whether they have any employees for whom social security contributions should be paid through the Dutch payroll. It is also important to ascertain whether there are any labour law consequences for employer and employee under the new Act.

We are of the opinion that European nationals (not resident in the Netherlands) had employee insurance coverage prior to 1 January 2012 on the grounds of the recent Salemink Judgment. 

VMW Taxand will gladly assist you in determining the consequences for your company.

Should you have any queries, please do not hesitate to contact Chris van Wijngaarden (chris.vanwijngaarden@vmwtaxand.nl) or Martine Hoogendoorn (martine.hoogendoorn@vmwtaxand.nl).