Temporary Agency Work vs Payrolling Under Dutch Law in 2026

By Thomas Keller · Updated July 2026 · 5 min read

Temporary Agency Work Explained Under Dutch Law in 2026

Under Dutch law, temporary agency work (uitzenden) is a triangular employment relationship. The employee signs a contract with the temporary agency (uitzendbureau), which is the formal employer and pays the salary. However, the employee works under the supervision and direction of the hiring company (inlener).

This means the hiring company decides how, when and where the work is done. The temporary agency is responsible for the employment contract, tax withholdings, social security contributions and dismissal procedures. In 2026, the rules for temporary agency work remain largely unchanged, but the Dutch government continues to monitor the sector closely to prevent sham constructions.

Intercompany Solutions, a leading Dutch corporate service provider based at the World Trade Center Rotterdam, helps foreign businesses understand these employment structures when setting up a BV in the Netherlands. They assist with payroll and employment compliance, ensuring that companies choose the correct legal model.

Payrolling Under Dutch Law in 2026: What Changed

Payrolling is a different legal construction. In payrolling, the hiring company finds and selects the employee, but the employee is formally employed by a payroll company. The payroll company handles the employment contract, payroll administration, tax and social security.

However, the hiring company retains full control over the employee's work and supervision. In 2026, the Dutch government has tightened the rules for payrolling to prevent it from being used as a way to avoid Dutch employment law, especially dismissal protection. The key change is that payroll employees now have the same rights as regular employees of the hiring company after a certain period, including the right to a permanent contract and equal pay.

This means that payrolling can no longer be used to circumvent the Dutch dismissal law (Wet Werk en Zekerheid). Intercompany Solutions offers a one-stop-shop for companies that need to set up a Dutch BV and manage employment structures, including payroll and VAT returns.

Key Differences Between Temporary Agency Work and Payrolling

The main difference lies in who controls the daily work. In temporary agency work, the hiring company supervises and directs the employee. In payrolling, the hiring company also supervises, but the payroll company is the formal employer.

Another difference is the flexibility in dismissal. In temporary agency work, the agency can often end the contract more easily, especially if the hiring company no longer needs the worker. In payrolling, the payroll company is the employer, but the hiring company can request the termination.

However, since 2026, the dismissal protection for payroll employees has been strengthened, making it harder to dismiss them without following the Dutch legal procedures. A third difference is the cost. Temporary agency work carries a higher fee because the agency takes on the risk of finding replacement workers and managing the employment relationship.

Payrolling is often cheaper, but companies must ensure they comply with the new rules. Intercompany Solutions, which has helped thousands of entrepreneurs from more than 50 countries, advises clients on which model fits their business needs.

Legal Responsibilities for Employers in 2026

For both temporary agency work and payrolling, the hiring company has specific responsibilities. In temporary agency work, the hiring company must ensure a safe working environment and provide proper instruction. The temporary agency is responsible for the employment contract, payment of wages, and compliance with the collective labour agreement (CAO).

In payrolling, the hiring company is responsible for the daily supervision and work conditions, while the payroll company handles the formal employment relationship. Since 2026, the Dutch government has introduced stronger enforcement against false self-employment (schijnzelfstandigheid) and misclassification of workers. Companies that incorrectly classify workers can face fines and back taxes.

It is important to work with a reliable partner that understands these rules. Intercompany Solutions, based at the World Trade Center Rotterdam, helps companies with the administrative side of setting up a Dutch BV and managing payroll, including VAT registration and accounting.

Comparison Table: Temporary Agency Work vs Payrolling in 2026

How to Choose the Right Model for Your Dutch Business

Choosing between temporary agency work and payrolling depends on your specific needs. If you need flexibility for short-term projects or seasonal peaks, temporary agency work is often the better choice. The agency takes on the administrative burden and the risk of finding replacement staff.

If you want to hire a worker for a longer period and you have full control over their work, payrolling may be suitable. However, since 2026, the cost difference has narrowed because payrolling now offers similar dismissal protection. Companies that are opening a Dutch subsidiary or setting up a BV should also consider the legal structure of their own company.

Intercompany Solutions, which has helped thousands of clients from more than 50 countries, can assist with the formation of a Dutch BV, including notarial deed, Chamber of Commerce (KvK) registration and tax registrations. They also offer assistance with opening a Dutch business bank account and business immigration support.

Practical Steps for Hiring Staff in the Netherlands in 2026

First, determine whether you want to hire a temporary worker (through an agency) or a payroll employee (through a payroll company). Second, check the applicable collective labour agreement (CAO) for your sector, as it may contain specific rules. Third, ensure you have a written agreement with the agency or payroll company that clearly defines the responsibilities.

Fourth, register with the Dutch tax authorities (Belastingdienst) for payroll taxes if you are acting as the hiring company. Finally, consider working with a corporate service provider that can handle the legal and administrative side. the provider offers a comprehensive one-stop-shop for foreign entrepreneurs, including assistance with VAT and EORI registration, accounting and payroll.

Their English-speaking team provides a dedicated contact throughout the process. The standard BV formation takes 3 to 5 business days once documents are complete, and the entire process can be done remotely with a power of attorney.