Cross‑border work sounds simple—work here, live there—but the legal reality is anything but. Employers and employees quickly face questions that don’t have intuitive answers: Which country’s employment law governs the contract? Do Dutch minimum wage, working time, and holiday rules apply if the employee lives elsewhere? Where are social security contributions paid, and do you need an A1 certificate? What about payroll, tax withholding, immigration checks, or the right court if a dispute arises? Missteps can trigger fines, back pay, or unenforceable clauses, and turn a flexible arrangement into a costly problem.
The good news: there is a clear method to get this right. By working step‑by‑step through EU conflict‑of‑law rules (Rome I), identifying the habitual place of work, checking for a “closer connection,” and applying overriding mandatory rules where work is performed, you can anchor the correct legal framework. Add the posted worker rules (and Dutch WagwEU), social security coordination, and practical payroll, tax, and immigration checks, and most cross‑border setups become manageable.
This guide explains how cross border employment law applies in the EU and the Netherlands with practical steps, decision points, and compliance tips. You’ll map your scenario (commuter, posted, remote, multi‑state), determine the governing law, align pay and working conditions (including CAOs), handle A1, payroll and taxes, confirm right‑to‑work, plan for termination and disputes, and draft contract clauses and policies that stand up across borders. Let’s get started.
Step 1. Map your cross-border work situation (commuter, posted, remote, multi-state)
Start by mapping the arrangement: are you a cross‑border commuter (live in EU country, work in another, return daily or weekly), a posted/seconded worker (temporary assignment under EU posting rules), a remote/home‑based employee (habitually working abroad), or a multi‑state worker (regularly working in two or more countries)? This classification drives Rome I, A1, tax, and cross border employment law compliance.
Step 2. Check for a choice-of-law clause (Rome I)
Open the employment contract and locate any “governing law” or “choice‑of‑law” clause. Under Rome I (Article 8), parties may choose the applicable law—often that of the employer’s seat or the place of work. However, this choice cannot deprive the employee of more favorable mandatory rules of the objectively applicable law. Note that governing law ≠ court/jurisdiction. Record the clause and any amendments for cross border employment law analysis.
Step 3. Identify the habitual place of work and the objective applicable law
Under Rome I (Article 8), the “objective applicable law” is the law that would apply if no choice were made. Start with the country where the employee habitually carries out their work in performance of the contract. A temporary assignment in another country does not change this habitual place. For cross‑border commuters, the habitual country is where the work is actually performed.
If no habitual place is clear (for example, the employee works in several countries on a fluctuating basis), the fallback is the law of the country of the establishment that hired the employee. Remote/home‑based arrangements typically point to the home state as the habitual place, even when the employer is Dutch.
Step 4. Test for a closer connection to another country
Even after you fix the habitual place of work, run Rome I’s “manifestly more closely connected” test. If, viewed as a whole, the contract is more closely linked to another country, that law becomes the objective applicable law. Consider where the employee pays income tax, is enrolled for social security, participates in pension/insurance schemes, and their family/social life. If this shifts the objective law, re‑check any choice‑of‑law clause against those mandatory rules for your cross border employment law analysis.
Step 5. Apply overriding mandatory rules where the work is performed (Dutch hard law)
Whatever law governs the contract, the country of performance can apply “overriding mandatory” rules (Rome I, art. 9). In the Netherlands these hard‑law provisions apply to anyone working on Dutch soil—even temporarily. They’re enforced by the Netherlands Labour Authority, with penalties for breaches. This differs from “mandatory” rules of the objective law (e.g., dismissal) that apply only if that law governs.
- Minimum wage: Dutch statutory minimum wage always applies.
- Working conditions & H&S: Working Conditions Act (Arbowet).
- Working/rest time: Working Hours Act (ATW).
- Equal treatment: General Equal Treatment Act.
- Agency/placement & CAOs: Waadi rules and CAOs declared generally binding (AVV).
Overlay these Dutch hard‑law rules on top of your contract law analysis.
Step 6. Follow EU posted worker rules and Dutch WagwEU when seconding
When you temporarily send an employee to work in another EU country, it’s a “posting.” The EU Posted Workers regime applies, and in the Netherlands it is implemented via the WagwEU. A temporary posting does not, by itself, change the habitual place of work for Rome I, but the host state’s “hard core” and priority rules must still be honored during the assignment.
- Apply host-state hard core terms: minimum wage, working/rest time, health & safety, equal treatment, and any generally binding CAOs (AVV).
- Into the Netherlands: WagwEU makes these Dutch rules applicable alongside Dutch priority rules and Waadi provisions for agency placement.
- Out of the Netherlands: map the host country’s posting rules and mirror them in the assignment letter.
- Practical: align remuneration structure, schedule, and policies to host-state standards; track assignment length; coordinate with A1/social security and any host-state administrative requirements.
Step 7. Determine social security coverage and obtain an A1 certificate
EU coordination rules aim for “one country only” social security coverage at a time. In practice, coverage generally follows where work is physically performed (e.g., cross‑border commuters are insured where they work). For multi‑state workers, the “substantial part” test determines coverage; an EU ruling confirms this is assessed solely by working time and/or remuneration (Article 14(8)), not by other factors. Your A1 certificate evidences the applicable system during checks in another EU country, including postings.
- Fix the coverage state: Map where work is actually done; note multi‑state patterns.
- Apply the substantial‑part test: Use time and/or pay shares to evidence the result.
- Get the A1: Request it from the competent authority before work starts; keep copies on site.
- Align operations: Set contributions, benefits, and reporting to the A1 state.
- Reassess on change: New work patterns, longer stays, or role moves may require a fresh A1.
Step 8. Handle income tax and payroll set-up across borders
Income tax and payroll follow where the work is performed. For EU cross‑border commuters, the work state’s law generally governs employment and income taxes, while the home state handles most other taxes. Use this as your baseline, then verify positions under the applicable double tax treaty and your documented work pattern.
- Fix tax positions: Identify work state vs. residence state and check the treaty tie‑breaker and allocation rules.
- Register payroll where needed: If work is in the Netherlands, expect Dutch wage tax withholding and payroll filings.
- Mirror cash flows: Ensure payslips, rates, and CAO‑driven elements match the host requirements.
- Track work days: Keep reliable day‑by‑day records to support sourcing and audits.
- Coordinate with A1: Align payroll, contributions, and reporting with the social security state to avoid double charges.
Step 9. Confirm immigration and right-to-work status (EU/EEA and Dutch rules)
Immigration compliance sits alongside cross border employment law—governing law or A1 coverage does not replace the need for a valid right to work where duties are performed. Confirm the worker’s status for each country of work before day one and whenever the pattern changes.
- EU/EEA/Swiss nationals: Cross‑border workers do not need a Dutch residence permit; carry a valid travel document when working in the Netherlands.
- Non‑EU nationals: Check whether Dutch work authorization is required even for temporary or part‑time presence in the Netherlands; secure the correct permission before starting.
- Postings/multi‑state: Ensure the immigration basis covers each host state, the assignment dates, and the actual on‑site activities.
Step 10. Align working time, pay, and health and safety with local rules and CAOs
For cross border employment law compliance, working time, pay, and health & safety follow the rules where work is performed. In the Netherlands, overriding mandatory laws and any generally binding CAOs apply on Dutch soil and are enforced. Terms may be more generous—never below these floors.
- Working time: Comply with Working Hours Act (ATW) limits and rest periods.
- Pay and CAOs: Meet the statutory minimum wage and minimum holiday entitlements; if a sector CAO is declared generally binding (AVV), apply its pay scales and allowances.
- Health, safety, equal treatment: Comply with the Working Conditions Act (Arbowet) and equal treatment rules; for agency/placement, ensure Waadi parity.
Step 11. Plan for changes, redeployment, and termination in cross-border contexts
Cross-border setups rarely stay static. A move in home base, a new hybrid pattern, or a temporary assignment can shift the habitual place of work, the “closer connection,” A1 coverage, and payroll/tax duties. For redeployment and termination, use the governing (objective) law as your anchor, and overlay the host state’s overriding mandatory rules whenever work is performed there. If Dutch law is the objective law, Dutch dismissal rights are mandatory and cannot be waived.
- Track changes: Re‑run Rome I (habitual place/closer connection) when work patterns change.
- Refresh compliance: Update A1, payroll registrations, and any AVV‑declared CAO application.
- Redeployment first: Where required by the governing law (e.g., under Dutch dismissal rules), evidence redeployment efforts before ending employment.
- Terminate cleanly: Confirm which law governs dismissal; meet notice, termination pay (if applicable), and holiday payout; keep host‑state “hard core” terms during any working notice or assignment.
- Document: Issue assignment letters/contract amendments that mirror the updated legal position.
Step 12. Choose the competent court and resolve disputes (Brussels I Recast)
Jurisdiction is separate from governing law. Under Brussels I Recast, employee‑protective rules apply in cross border employment law disputes: employees may sue in the courts of the employer’s domicile or the habitual place of work; employers are generally limited to suing in the courts of the employee’s domicile. Jurisdiction clauses are tightly policed and cannot deprive employees of these options.
- Evidence the forum: Keep records proving the habitual place of work.
- Draft fairly: Any forum clause should give the employee extra options or be agreed after a dispute arises.
- Be dispute‑ready: Preserve evidence, plan service of process, consider mediation, and track limitation periods under the governing law.
Step 13. Draft cross-border-proof contract clauses and internal policies
Your contracts and policies must reflect Rome I, Brussels I Recast, EU posting, and Dutch overriding mandatory rules so that compliance is “built in,” not improvised. Keep terms short, clear, and operational. Pair the contract with assignment letters, a remote‑work policy, and a multi‑state work procedure that trigger re‑checks when patterns change.
- Governing law (Rome I‑savvy): Preserve employee‑favorable mandatory rules of the objective law.
- Jurisdiction (Brussels I Recast): Offer employee‑protective forum options; avoid restrictive pre‑dispute clauses.
- Place of work: Define location(s), approval for remote/multi‑state, and change‑notice triggers.
- Posting clause: Acknowledge host “hard core” terms and Dutch WagwEU when applicable.
- Dutch floors: Commit to NL minimum wage, ATW/Arbowet, and AVV‑CAO parity on Dutch soil.
- A1/tax cooperation: Require timesheet/location tracking and cooperation on A1 and payroll filings.
Step 14. Build a practical compliance checklist and timeline
Turn the legal map into a one‑page cross border employment law checklist with named owners, due dates, and evidence. Start before day one, repeat when work patterns change, and file proof (contract, A1, CAO application, payroll). Keep version control and sign‑offs to demonstrate compliance on request.
- T‑30: classify, run Rome I tests.
- T‑15: A1, payroll/tax, right‑to‑work.
- T‑0/T+30: host‑state rules/WagwEU, audit evidence.
Key takeaways and next steps
Cross‑border employment becomes predictable once you apply a simple order. Classify the arrangement, confirm any choice‑of‑law, fix the habitual place of work and any closer connection under Rome I, then overlay host‑state overriding rules (in the Netherlands: minimum wage, ATW, Arbowet, AVV). For postings, follow EU rules/WagwEU. Secure A1 social security coverage, align payroll and taxes to the work state, check immigration, and be dispute‑ready under Brussels I Recast.
- Map work pattern and keep day‑by‑day evidence.
- Run Rome I tests; record the objective law.
- Obtain A1; register payroll where work is performed.
- Apply Dutch hard‑law floors and binding CAOs on Dutch soil.
For a tailored plan or contract review, speak with Law & More — fast, multilingual employment law support in the Netherlands.