Secondment of employees: prevent transfer to hirer

Publication date: 2 June 2020
Temporary employment agencies and secondment firms are not allowed to prevent the employee from entering into employment with the hirer. However, it is possible to receive compensation for the costs incurred in connection with the recruitment, training and secondment of the employee.

Temporary employment agencies and secondment firms are not allowed to prevent the employee from entering into employment with the hirer. However, it is possible to receive compensation for the costs incurred in connection with the recruitment, training and secondment of the employee.

Ban on obstructions

Pursuant to European law, temporary employees may not be prevented from entering into employment with a company they are seconded to. The idea behind this is that an employee may not be prevented from getting a permanent job.

In the Netherlands, this has been included in the Placement of Personnel by Intermediaries Act (Waadi). This Act does not only apply to temporary employment agencies but also to any other company that supplies personnel. Thus also to seconders, payrollers and even companies that occasionally place a staff member for a longer period of time with another company may be covered by this scheme. How can you prevent the application of the ban on obstructions to you and your employees?

When does the ban on obstructions apply?

The Waadi – hence the ban on obstructions – does apply to all situations where one company has an employee work under the “direction and supervision” of another company. It does not matter whether the employee has a temporary contract or a permanent contract with your company. If you have a person work in another company, however still under your direction and supervision, the Waadi does not apply. You can therefore avoid the ban on obstructions by demonstrably ensuring sufficient direction and supervision.

Direction and supervision

When is there sufficient direction and supervision? In order to determine this, the court will look at the arrangements you made with the hirer and their actual implementation.

Indications that the ban on obstructions applies are:

• The hirer determines the content of the tasks of your employee.
• The employee cannot be replaced by another staff member from your company.
• The employee has been supplied to another company by the hirer.
• The employee has, without your knowledge, been given a different position than the one you supplied him for.
• You only consult with the employee on peripheral matters, such as holidays, sickness absenteeism, etc., or you only function as a sounding board.

Indications that the ban on obstructions does not apply are:

• You have regular work meetings with your employee.
• The employee is given tasks by you or one of your employees.
• You can replace the employee with another staff member.
• You hold performance and appraisal interviews with your employee.

Waadi registration

Even companies that only occasionally supply or second employees often have a Waadi registration to prevent business with the Tax and Customs Administration. Does such a registration affect the ban on obstructions?

The court may derive from the Waadi registration that you do indeed supply personnel and therefore assume that the ban applies. However, registration is not decisive. If you can demonstrate that the employee works under your direction and supervision, the ban on obstructions shall not apply.

Compensation for costs incurred

The ban on obstructions does apply and your employee switches to the hirer. Can you recover some of the investments you made in the employee? That is possible, but then you have to include in the contract with the hirer that he shall compensate you for the costs incurred for recruitment, training and secondment of the employee.

More information

Would you like to second employees to other companies and prevent them from transferring to that company? We will be happy to assist you drafting a secondment agreement. Do you have any questions concerning employment contracts and temporary employment contracts, or do you need advice on any other employment-related questions? Please contact us: