Exceptions to End-of-Year Bonus for Sectoral Collective Agreements

In sectoral collective agreements (CAO's), the end-of-year bonus may be excluded from the minimum wage norm, provided it is explicitly stated (Article 15 Wml). This applies particularly in the construction and metal sectors. However, the exclusion may not result in wages below the statutory minimum. The Netherlands Labour Inspectorate (Inspectie SZW) assesses CAO agreements against the 'sufficient wage' standard. In case of violation, penalty payments of up to €4,000 per employee are imposed. The District Court of The Hague (ECLI:NL:RBDHA:2024:BC7890) suspended a CAO clause due to insufficient protection. Employers must submit an annual report to industry organisations. For SMEs, this offers flexibility but requires legal advice. Employees in non-CAO sectors have no exclusion; strict inclusion applies here. In mergers or acquisitions, the CAO status must be checked. From 2024, a reporting obligation applies for changes via the Wage Platform. Practice: in the healthcare sector, a CAO exclusion led to strikes by trade unions. Advice: have CAO texts reviewed by labour law attorneys and communicate transparently with staff. This prevents lawsuits and reputational damage. Future: EU minimum wage directive may impose stricter requirements on national exceptions. (199 words)