We deal daily with workers from the European Union who have come to live permanently in the Netherlands for a better life, more income or for political reasons. They have often come here through an employment agency that had them in housing.
Of course, we also have many employees working from other countries in Europe such as Ukraine or the world, but this blog is specifically about EU countries. EU employees are in fact entitled to a scheme, which leaves them with more net salary for the same gross salary as other employees. They call this the ET Scheme.
Although it is commonly thought that it is mainly Polish, Romanian, Hungarian and Bulgarian workers living in housing, migrant workers from Spain and Portugal are also increasingly finding our country for a better life. These countries also have relatively high prices, but fewer jobs than the Netherlands. In addition, many jobs are in tourism and these are seasonal, so unemployment rates are higher in winter than in summer.
The ET scheme for temporary workers in the Netherlands is a tax scheme that allows employers to reimburse certain expenses for foreign employees, such as accommodation, travel and meals, tax-free. This reduces the employee's gross salary but increases net income at no extra cost to the employer. The scheme is intended for employees working temporarily in the Netherlands and there must be proof of the expenses incurred.
The ET scheme for temporary workers
EU employees not entitled to the ET scheme are basically those already living or established in the Netherlands before starting their jobs. This includes:
- Dutch residents: Employees already living in the Netherlands are not entitled to the ET scheme, as it is specifically designed for employees coming to the Netherlands temporarily for work.
- Employees with permanent residence in the Netherlands: If an EU employee has permanent residence in the Netherlands and is not just working temporarily in the Netherlands, he/she cannot use the ET scheme.
- Employees not in temporary employment: The ET scheme is intended for employees working temporarily in the Netherlands. If an employee works permanently in the Netherlands, he/she falls outside the scheme.
Double living expenses vary by country. For example, employees from Romania can exchange more wages for living expenses than employees from Spain and Portugal. This is because the Netherlands is often comparatively more expensive than the temporary worker's home country.
Want to know what an employment agency's cost and rate is made up of? What is the cost of an employment agency made up of? | Twente Personeelsdiensten Wierden
Yet this is a rule that may be viewed critically, because the difference in costs between the Netherlands and the country of origin does not always justify allowing employees from cheaper countries, such as Romania, to exchange more tax-free than employees from countries like Spain or Portugal. This can lead to unfair differences in net income between employees from different countries, even if they perform the same job. It is therefore important to assess this arrangement carefully to avoid creating inequality. Based on the explanation of the ET scheme, it is precisely the double living expenses from more expensive countries that should be higher because they have to spend proportionally more for their family in the country of origin.
Whatever direction the ET scheme takes, for Twente Personeelsdiensten it still remains a "far from our bed show. At the moment, we have no housing and all our employees live independently in the region. What the future will bring is still unclear, so follow us to stay updated on what direction we will take!
