Temporary agency workers and their rights: What do you need to know?

13 October 2024

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Temporary agency workers and their rights: What do you need to know?

In the Netherlands, thousands of people work as temporary agency workers. But what exactly are the rights and obligations of temporary agency workers? In this article, we explain which rules apply and what both temporary agency workers and employment agencies need to know about their employment relationship.

What is a temporary agency worker?

A temporary agency worker is an employee who, via a temporary employment agency, works temporarily at a client (the hirer). There is a triangular relationship between the temporary agency worker, the temporary employment agency, and the hirer. The temporary employment agency is the formal employer of the temporary agency worker, while the temporary agency worker performs the work at the client.

Rights of temporary agency workers

Temporary agency workers are entitled to the same terms and conditions of employment as employees who are directly employed by the client, under the Placement of Personnel by Intermediaries Act (WAADI). This means they are entitled to equal pay for equal work, allowances, vacation days and leave, as laid down in the hirer’s collective labor agreement. From day one, the so-called ‘hirer’s remuneration’ applies, which means that temporary agency workers should receive the same pay as regular employees in comparable positions.

Additionally, temporary agency workers are entitled to:

Vacation days and holiday allowance:
Temporary agency workers accrue vacation days and are entitled to 8% holiday allowance of their gross salary.Continued pay during illness
:Since 2023, temporary agency workers cannot be dismissed immediately when ill. The employment agency is obliged to continue paying wages for up to two years, depending on the duration of the contract.

Pension accrual

Temporary agency workers accrue pension after 8 weeks worked, and from 1 January 2024 this applies immediately from the first working day for temporary agency workers who are 18 years or older.
What rights do you have exactly?

What your rights as a temporary agency worker are depends on:

Whether you work for a ‘bound’ or ‘unbound’ employment agency (in other words, whether the agency is bound by a collective labor agreement).

Whether there is an agency clause in your contract.

It is important to check your contract carefully: an agency clause means that your contract can automatically end if the work at the client stops. If you work for a temp agency that is bound by a collective agreement, additional or supplementary rights often apply.
Different phases within temporary agency work
The phase system for temporary agency workers in the Netherlands is divided into three phases: phase A, B, and C. Each phase offers different rights and obligations for the temporary agency worker:
Phase A: In this phase, which lasts a maximum of 52 weeks, the temporary agency worker usually works on the basis of an agreement with an agency clause. This means that the contract automatically ends if the client no longer has work.Do you have a contract in phase A without an agency clause
? Then the agency clause does not apply and the temp agency cannot simply dismiss you. In this phase you can work for one or more companies, and it is possible to receive an unlimited number of contracts; there is no maximum number.No work?
The temp agency must inform you in writing whether you will continue to be paid if there is temporarily no work. This may be stated in the contract or confirmed, for example, by email. If the temp agency does not pay when there is no work, they must record this in writing immediately upon hiring. If not, you may still sometimes be entitled to wages when there is no work.Phase B

: After phase A, the temporary agency worker moves on to phase B, in which he or she receives a fixed-term contract. The agency clause no longer applies, and the temporary worker has more security regarding work and income. Even if there is temporarily no work for you, you are entitled to wages as long as your contract runs. In that case, the employment agency must continue to pay 100% of your wages. In some cases, the employment agency will try to find suitable alternative work for you. You are then obliged to accept the work offered.

Phase C

: Phase C begins after three years working in phase B or after six contracts. Here the temporary agency worker receives a contract for an indefinite term, which is comparable to a permanent contract. If the work ends, the employment agency must continue to pay you 100% in this phase. Sometimes the employment agency will look for suitable alternative work for you. You are then obliged to accept the work offered, provided it is reasonable and suitable.
The role of the employment agency
The employment agency is responsible for the correct compliance with the terms of employment. This includes paying wages, ensuring a safe workplace, and complying with the rules regarding working conditions. The employment agency must also comply with the rules of the WAADI Act and the collective agreement for temporary agency workers.

In addition, the employment agency must:

Be registered with the Chamber of Commerce.

Before placing a temporary agency worker, clearly communicate what the working conditions are.

Comply with the job qualifications required for the relevant position.

Liability for accidents or damage
Although the client company is responsible for safety in the workplace, the temp agency can in certain cases also be held liable for damage that the agency worker suffers or causes during work. Therefore, it is important that both the temp agency and the client company make clear agreements and record them in a contract.
Transition payment for agency workers
As an agency worker, you are also entitled to a transition payment

as soon as your contract is terminated at the initiative of the temp agency or is not renewed. This applies regardless of which phase you are in, provided you do not resign yourself and are at least 18 years old. The

transition payment

is a statutory payment that can cover any transfer or retraining costs.

The amount of the transition payment is determined based on your monthly salary and the number of years you have worked. You accrue this payment from your first working day. So it does not matter whether you have a temporary assignment or have been working through the same temp agency for years.

Note: if you decide to quit, you are not entitled to a transition payment. Even if you have a fixed-term contract that ends by operation of law and is not renewed by the temp agency, you are entitled to this payment.

This way, as an agency worker, you will not be left empty-handed when your employment ends.

Pay when there is no work: how does it work in phase A?
In phase A, most agency workers work with an agency clause. This means that the contract automatically ends if the client has no more work. In that case, the temp agency is not obliged to continue paying wages once the work stops.

Sometimes, however, the agency clause is excluded in the contract. If there is no agency clause in your agreement, you are generally entitled to continued pay, even if there is temporarily no work. The temp agency must clearly state in writing whether the agency clause does or does not apply. This is usually in your employment contract or in an appendix, but it may also be laid down by email.

Are you told that there is no work and there is no agency clause in your contract? Then you are often entitled to salary, even if you are not offered any work. Therefore, check your contract carefully and, if in doubt, contact, for example, FNV or CNV for advice.

Note: in phases 1 and 2 of the ABU collective agreement, or phase A of the NBBU collective agreement, it works largely the same.
Termination in phase A: with or without an agency clause

Do you have a phase A contract (or phase 1 and 2) and are you wondering exactly how dismissal works? The answer depends on whether your contract includes an agency clause.With agency clauseIf your contract contains an agency clause, your temporary agency agreement can end relatively easily. Your contract ends as soon as the company you work for (the ‘hirer’) indicates that your assignment is finished. In that case, you are only entitled to wages for the hours actually worked. This allows the employment agency to let you go immediately if there is no more work for you—without a notice period or further procedure.

Do you have a phase A contract (or phase 1 and 2) where the agency clause does not apply? Then stricter rules for dismissal apply. In that case, the employment agency cannot summarily dismiss you if the work stops at the client.
Without agency clause
In such a situation:

The employment agency must follow the normal dismissal rules, just like with a permanent employment contract.

You are entitled to a notice period, depending on the length of your contract.

The employment agency – if they want to terminate the contract – often has to request permission from the UWV or go to the subdistrict court.

Note: If your contract is for a fixed term, it will simply end after the agreed period. If you are nevertheless dismissed early without a valid reason, you may be entitled to compensation or continued payment of wages for the remaining contract period.

Maternity leave for temporary agency workers

Are you a temporary agency worker and pregnant? Then you are entitled to maternity leave, just like other employees. During your leave, you will generally receive a pregnancy and maternity benefit via the UWV. If you become ill as a result of your pregnancy, your wages will continue to be paid. It does not matter whether you are in permanent employment or working through an agency—the legal protection applies to everyone.

So: if you are expecting a baby, discuss your situation with your employment agency in good time. They can inform you about the official scheme and ensure that your rights to leave and benefits are properly arranged.
Dismissal protection in phase C (or phase 4)
If, as a temporary agency worker, you have reached phase C (according to the NBBU/ABU collective agreement) or phase 4, you now have a permanent contract with the employment agency. From this moment, your protection against dismissal is almost the same as that of employees with a permanent contract at other employers. That means the agency cannot simply dismiss you.

Dismissal during phase C or 4 is only possible under strict conditions:
Dismissal with immediate effect: This is only permitted for a serious reason, for example theft or gross misconduct.With permission from the UWV or the subdistrict court judge:
If the employment agency wishes to terminate due to business-economic reasons

or long-term incapacity for work, approval from the UWV is always required. For personal reasons (think of a disrupted employment relationship), the subdistrict court must grant permission.

Termination by mutual consent:

You and the employment agency can make arrangements together about ending the contract, recorded in a termination agreement.

You are also entitled to the statutory notice period and, in many cases, a transition payment. So always stay alert: it is wise to seek advice on dismissal from a union, the Juridisch Loket, or, for example, FNV or CNV. That way you will know exactly what you are entitled to and you won’t be left empty-handed.

Entering directly into phase B or C: what happens?
Sometimes a temporary agency worker starts directly in phase B or C, without having first worked in phase A. That can happen, for example, if you have previously done temp agency work through another agency or if the nature of the role requires it. If you start directly in phase B, you immediately get more certainty: you receive a fixed-term contract without the agency clause, which means the contract does not simply end if the client has no more work. If you start straightaway in phase C, you even have an immediate right to a permanent contract. The usual transition via phase A is then skipped and you benefit sooner from the advantages that come with greater job security.

Note: there may be specific arrangements in your contract about this entry. It is therefore wise to read this carefully before you sign. Do you have questions about your situation or are you unsure which rules apply? You can always seek advice from unions such as FNV or CNV, or consult your collective labor agreement.
Terminating the contract early in phase B or C

For temporary agency workers in phase B or phase C, there is usually a fixed-term or open-ended contract without the agency clause. Early termination by the employment agency is then not simply possible. Termination before the agreed end date is only allowed if there is a clear provision about this in the contract, such as an interim termination option. If such a provision is not included, the contract will in principle continue until the agreed end date.

In addition, the employment agency must have a legal reason to terminate your contract early, for example in case of serious

culpable conduct

. A notice period remains mandatory in most cases. So always go through your contract and terms of employment carefully, so you know exactly where you stand.

Rights at a non-affiliated staffing agency

Do you work for a staffing agency that is not affiliated with industry associations such as ABU or NBBU? You still have certain rights as a temporary worker, but some arrangements may differ. The Allocation of Workers by Intermediaries Act (WAADI) still applies, which entitles you, among other things, to the statutory minimum wage, vacation days, and holiday allowance. In addition, as a temp working through a non-affiliated agency you may not simply be worse off than colleagues employed directly by the client—the basic protection remains in force.

The biggest differences are often in additional schemes, such as extra benefits from a collective labor agreement (cao) or certain leave arrangements. At a non-affiliated staffing agency these are not always arranged by default. It is therefore wise to read the employment contract carefully and ask which terms apply exactly. If in doubt, you can always seek advice from a legal advisor or a trade union, so you know exactly where you stand.

Tacit renewal of your contract in phase B

In phase B (also called phase 3 in some collective agreements), you usually have a fixed-term contract with an agreed end date. But what if that end date passes and you simply keep working without anything new being explicitly agreed? Then a so-called ‘tacit renewal’ arises. This means your existing contract is essentially continued automatically under the same terms as before.

Note: this renewal is not unlimited. In phase B you may receive a maximum of six contracts within a period of three years. If you continue working after that period without further agreements, you may be entitled to a permanent contract.

In short, keep a close eye on when your contract ends and discuss any extension with your staffing agency in good time, so you know exactly where you stand.

Contracts with an end date in phases B and C

A contract in phase B or phase C often has a clear end date. So you know in advance how long your contract runs. On this agreed date, your employment ends automatically, unless you and the staffing agency decide to extend the contract before it ends.

What happens if you keep working after the end date without anything being agreed? Good news: your contract is then tacitly renewed and your original employment terms simply continue. So you won’t suddenly walk out the door without work or security.

Note: does the staffing agency want to terminate your contract early—so before the end date? That is only allowed if this is clearly stated in your contract and the agency can demonstrate a valid reason. Protecting your rights comes first.

Am I entitled to notice compensation in phase B or phase C?

Are you working as a temp in phase B or C and do you have a fixed-term contract of six months or longer? Then the staffing agency has a duty to notify. This means you must be informed in writing no later than one month before the end of your contract whether it will be extended or terminated. If this notice comes too late, you are entitled to notice compensation of up to one month’s salary.

Note: this obligation only applies to contracts with a clear end date. If you have a contract without a fixed end date (for example, a contract with an agency clause in phase A), no notice compensation applies.
Working for a non-affiliated staffing agency: what does that mean for your rights?
Are you working through a staffing agency that is not a member of ABU or NBBU? Then it’s good to know that not all rules from the ABU or NBBU collective labor agreement (cao) automatically apply to you. Even so, as a temporary worker you still have statutory rights that provide protection:
Terms of employment
: Even at an unaffiliated temp agency, you are entitled to the minimum wage, holiday pay, and vacation days. You fall under general legislation, such as the Civil Code and the WAADI.Hirer’s remuneration
: Often, as with other agencies, you are entitled to the same pay as the client’s permanent employees. This is laid down in the WAADI.Continued wage payment during illness

: You may not be dismissed simply because you are ill. The statutory rules on continued wage payment and protection during illness apply.

Pension accrual

: Even when no collective labor agreement applies, you may be entitled to accrue a pension under statutory rules.

Note: the precise terms of employment can vary, because unaffiliated agencies do not have to adhere to the collective labor agreement. Always check your contract carefully and ask for clarification if anything is unclear. That way you know exactly where you stand as a temporary worker.
What rights do I have when working for a temp agency bound by a collective labor agreement?
If you work through a temp agency that is affiliated with an industry association such as ABU or NBBU, you can count on extra safeguards and clear agreements. Your terms of employment are well arranged, and you gradually build up more rights step by step, depending on the phase in which you are working.

The most important rights at an affiliated temp agency at a glance:
Sick pay
:If you become ill, your pay continues in accordance with the applicable rules, including if you are ill during your pregnancy.
Maternity leave:
You are entitled to maternity and childbirth leave, just like permanent employees.Right to a permanent contract

When you reach the longest phase (phase C), you are entitled to a permanent contract. This usually happens after four years of working through the same temp agency.

Resigning from your job:In principle, you may resign, unless your temporary contract specifically states that this is not possible until the end date.

Transition payment
: If your contract ends, you are entitled to transition compensation under certain conditions.
Your exact rights also depend on the phase (‘A’, ‘B’ or ‘C’) of your employment contract and whether a temporary agency clause applies. You can read more about this in the next section.
Difference between affiliated and non-affiliated temp agencies
Not all temp agencies are the same when it comes to employment conditions. In the Netherlands, we distinguish between affiliated and non-affiliated temp agencies. But what does this mean for you as a temp worker?

Affiliated temp agencies
These agencies are affiliated with industry organizations such as ABU or NBBU. Working through an affiliated temp agency has a few clear advantages. You are covered by a collective labor agreement that offers extra protection, for example:
Continued payment during illness, including during your pregnancy;

Right to maternity leave;

Chance of a permanent contract after four years of service;Right to transition compensation when your contract ends;Often more clarity about your termination options.