Interested in gradar compensation survey data for the Netherlands?

If you’re looking to optimise your pay structures, it’s important to know as much as possible about the Dutch labour market, collective labour agreements, wage setting strategies and compensation surveys. That’s why we put together this short guide!

gradar acts as a reseller of quality survey data in the Netherlands. We build pay data directly into your system and ready to use alongside job evaluation results. Contact us about our options for Dutch market data - available at a discounted rate.

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The Labour Market In The Netherlands

The Netherlands has a highly developed economy and the world's 18th largest GDP by nominal measures, with the Netherlands being the 14th largest exporter and the 16th largest importer. The Netherlands is the fifth most densely populated country in the EU with a population of over 17 million.

The Netherlands has a large and well-developed social welfare system and a high level of social mobility. The Dutch labour market is characterised by high levels of work flexibility and a strong focus on skills and lifelong learning. This flexibility is reflected in the high level of part-time work and temporary contracts, as well as the practice of self-employment. The relatively low level of regulation means that there are relatively few restrictions on hiring and firing, and working hours are flexible.

As of July 2022, roughly 9.6 million people were in employment, giving the Netherlands one of the lowest unemployment rates within the EU.

Collective Labour Agreements In The Netherlands

In the Netherlands, several business sectors have a Collective Labour Agreement (CAO) in place. Dutch industrial relations were shaped in the early 20th century, with national-level bargaining between trade unions and employers’ organisations as a main feature. Collective bargaining remains highly centralised and is prioritised over individual labour agreements.

A 1937 law allows the government to extend a CLA and declare it binding on all employees in the same sector, the so-called mandatory extension. Extension can take place if the CLA covers 55% of the employees. This is mostly the case as around 80% of employees work for employers organised in industry associations.

The continuous high employer density and the latent pressure of mandatory extension largely explain the high collective bargaining coverage in the Netherlands which has remained fairly stable at around 85% in recent decades.

Wage Setting In The Netherlands

In the Netherlands, wage setting is mainly a decentralised process, with employers and employees negotiating wages and benefits through collective bargaining agreements or individual contracts. The Dutch system of wage setting is based on a tripartite model, in which employers, employees, and the government work together to determine wage levels. Collective bargaining agreements between trade unions and employer associations are common in the Netherlands, setting minimum wages and working conditions for the covered employees. These agreements are generally industry-specific and serve as the basis for wage negotiations between individual employers and employees. The Dutch government also plays a role in wage setting by setting minimum wage levels for certain sectors and supporting collective bargaining agreements through tax incentives and subsidies.

In the Netherlands employers must pay their employees at least the statutory minimum wage and the statutory minimum holiday allowance. The minimum wage consists of a basic wage and various allowances, such as for shift work and irregular working hours. It applies to all employees of 23 years of age and over. In case an organisation has its own CLA or is part of a CLA per business sector, more information about wages and employment conditions are included in this agreement.

In contrast to Germany, the available statistics do not confirm the textbook statement that in the Netherlands the collectively agreed (negotiated) wages are the main determinant of wage growth. Actual wages in the Netherlands traditionally rise above collectively agreed wages. As of January 2023 hourly CAO wages increased by 4.8% year-on-year, compared to just 2.6% in January 2022.

Additional information, especially for exempt jobs such as subject matter experts, middle and top management levels, can be found in surveys such as Culpepper’s Global Salary Budget & Compensation Planning Survey.

Compensation Surveys In The Netherlands

Compensation survey results in the Netherlands provide insights into jobs and their salaries. Pay market data helps employers determine and design their own compensation strategy.

Finding fair and competitive compensation for employees in the Netherlands does not necessarily have to rely on compensation survey market data, but may also be derived from above mentioned labour agreements, in combination with a premium for merit increases. These labour agreements will also provide employers with insights into quantifiable aspects of compensation such as base salaries, job tenure based increase percentages, starting salaries, allowances and benefits, holiday entitlements and working hours.

The market for compensation surveys in the Netherlands is mature, there are the Anglo-American vendors, as well as some local vendors such as Human Capital Group and its “Nationaal Bevolkingsonderzoek” with employer sourced data.

The gradar Solution

For companies looking to gain more clarity over their compensation, combining information from labour agreements and market data - supplemented by an internal analysis - makes a lot of sense. gradar is the tool by which to do it. 

With our foundation in point-factor based job evaluation, alongside our comprehensive compensation benchmarking functionality, we allow you to establish fair, transparent pay structures under one roof in one consolidated system.

Market data from third-party compensation survey providers can be uploaded to your gradar account - or even purchased as an out-of-the-box feature. Just purchase your gradar licence and pick the data sets you want - it’s that simple!

Data for Base Pay and Target Total Compensation is then displayed on your job profiles and as a detailed report. The system uses the benchmark job code from our job matching module to display job specific benchmark data.

This is the most affordable way to perform a salary comparison against market rates worldwide - and structure effective remuneration systems that set salaries at the most appropriate level.