As from 1 January 2018: Holiday Allowance Due on Overtime

Year of publication

2017


Edition number

289


Reference

Law of 25 January 2017 on amending the Minimum Wage and Minimum Holiday Allowance Act and any other laws relating to the reduction of the age limit for entitlement to the adult minimum wage, in connection with piecework pay and additional work and some other amendments, Staatsblad (Government Gazette) 2017, number 24


Decision

Since payment of minimum wages on additional work will be due per 1 January 2018, also the provision will expire according to which overtime is no part of the wage on which the minimum wage and holiday allowance have to be calculated. As a result, holiday allowance on overtime will be due from January 1, 2018. The provision will be directly effective and no transitional law has been made that, for overtime allowance worked before 1 January 2018, no holiday allowance would be due after 1 January 2018.

This implies that as from 1 January 2018, also holiday allowance will have to be paid for overtime worked before 1 January 2018.


Comments

Law of 25 January 2017 on amending the Minimum Wage and Minimum Holiday Allowance Act and any other laws relating to the reduction of the age limit for entitlement to the adult minimum wage, in connection with piecework pay and additional work and some other amendments, Staatsblad (Government Gazette) 2017, number 24

Employers who wish to avoid paying a holiday allowance for overtime worked before 1 January 2018 should ensure that the overtime hours are paid out before 1 January 2018 or are taken by working less. Taking overtime after January 1, 2018 also prevents payouts that include holiday allowance, but if it is not taken then, payout should be made including the holiday allowance.



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