Netherlands: Bill for partially paid parental leave approved

Employer Action Code: Act

A bill to bring the Netherlands in line with the European Union Work-Life Balance Directive (see our previous article: Agreement reached on Work-Life Balance Directive) on parental leave (among other things) was recently approved by the Senate and is awaiting publication. Under the new law, which will take effect on August 2, 2022, pay replacement benefits from the UWV (Employee Insurance Agency) will be offered to encourage parents to take parental leave.

Under current provisions, both parents are entitled to take 26 weeks of unpaid parental leave until the child is eight years old. Employers have no statutory obligation to continue paying the employee’s salary during this period; however, some collective bargaining agreements include provisions to this effect. Only 1.5% of companies surveyed by Willis Towers Watson provide parental leave in excess of legal requirements.

Key details

• Both parents will be eligible for pay replacement benefits for up to nine weeks, to be taken during the first year after the child’s birth. If this paid leave is not taken in full in the first year, the remainder will be converted into unpaid leave, which can be taken until the child has reached age eight. The total (paid and unpaid) period of parental leave remains 26 weeks.
• The benefit will equal 50% of capped daily earnings (currently 225.57 euros); the law provides for the possibility for future governments to increase this to 70%.
• Leave will have to be requested at least two months before the starting date; in the event of major business requirements, employers can agree on a different schedule with the employee (but still within the first year after the child’s birth), at the latest four weeks prior to the starting date.
• Applications for benefits can be submitted until 15 months after birth, which implies that the benefit will be available for parents whose child is born on or after May 2, 2021.

Employer implications

By offering paid leave benefits, the government expects more parents to take parental leave. When the issue was last examined by the Central Bureau of Statistics in 2017, only one in 10 fathers eligible for parental leave took the leave; almost an equal number expressed interest but felt unable to take the leave for financial reasons or concerns about overburdening colleagues.