Updated November 2026
A startup hires employees in the Netherlands through its own BV registered in the Netherlands or an employer of record (EOR), on a written contract under Dutch employment law. Decide early whether each role is permanent, because Dutch rules on chains of fixed-term contracts limit how long you can keep someone on a "temporary and see" basis.
Why "start them on a temporary contract" has limits
Founders hiring abroad often plan a fixed-term contract as a safety valve and decide later. The Netherlands allows fixed-term contracts, but the chain rules (ketenregeling) cap how many can follow each other and how long the chain can run. Once you pass either limit, the contract becomes permanent automatically.
Letting a fixed-term contract lapse is not free either. When employment ends at the employer's initiative, including choosing not to renew, a statutory transition payment (transitievergoeding) is generally owed.
The recruiting cost matters more. Experienced product and engineering people are usually on permanent contracts, and a fixed-term offer from an unknown foreign startup asks them to give up security. Decide the contract type when you write the job description.
BV, EOR or contractor for your first Dutch hire
| Route | When it fits | What to check |
|---|---|---|
| Your own BV | You expect a team in the Netherlands, not one person. | Registration with the Chamber of Commerce (KVK) and payroll tax registration with the Belastingdienst. |
| Employer of record | First one to three hires, or testing the market. | Whether the provider is a recognised sponsor with the IND, in case your best candidate needs a residence permit. |
| Self-employed contractor (zzp) | A defined project with real independence. | Enforcement against false self-employment has tightened recently. A full-time team member is unlikely to qualify. |
With an EOR, the EOR is the legal employer, so the chain rules and transition payment apply to its contract with your hire.
Sponsorship, the 30% ruling and working language
English works as the working language in most tech teams in the Netherlands, so you can recruit internationally. That also means your best candidate may be a non-EU national.
The common route for such hires is the highly skilled migrant (kennismigrant) scheme, and the employer must be recognised as a sponsor by the IND. This applies even when the candidate already works in the Netherlands on that permit, because the new employer must be a recognised sponsor too. If you use an EOR, ask whether it holds that recognition before the search starts.
- A fixed-term contract is an easy way to trial someone
- Salary is one annual figure
- Any company can hire someone already working here on a permit
- Ending employment is mainly a matter of notice
- Fixed-term chains are capped, and strong candidates rarely leave a permanent job for one
- Offers state whether pay includes the statutory holiday allowance
- Highly skilled migrants need a recognised sponsor as employer
- Ending a permanent contract usually runs through UWV, the court or a settlement agreement
Candidates from abroad may ask about the 30% ruling, a tax facility available to some employees recruited from outside the Netherlands. It has been changing, so do not promise it in an offer. Employment and tax rules change and differ by situation, so confirm eligibility and your wider plan with a Dutch employment lawyer, a tax adviser or your EOR provider before hiring.
Worked example: a UK startup hires its first product manager in Amsterdam
Illustrative only. A UK B2B software startup wants its first product manager in Amsterdam. The founder, Priya, planned a short fixed-term contract to see how it went.
- Contract type first. Before writing the job description, Priya made the role permanent. A trial contract would have put off most employed candidates.
- Employment route. No Dutch entity, so she used an EOR provider and confirmed it was a recognised IND sponsor.
- The finalist. The strongest candidate was a non-EU national already in Amsterdam on a highly skilled migrant permit. Because the EOR was a recognised sponsor, she could be hired.
- The offer. It said whether pay included holiday allowance and made no promise about the 30% ruling.
The outcome was a permanent hire with no permit surprise. With the fixed-term plan or a non-sponsor EOR, her best candidate would have been out of reach. For more on the local market, see our Netherlands startup recruiting guide.
Where Funded.club fits
We are a fixed-fee recruiting partner for funded startups and fast-growing teams across North America, Europe and APAC. Our recruiters work fully remotely, and since 2019 we've helped 500+ startups from Seed to Series D. We run the search, and your own BV or EOR handles the employment, contract and any sponsorship.
One dedicated recruiter runs each search end to end, with first screened candidates within 7 days and 33 days on average from kick-off to hire. We flag early when a candidate will need sponsorship.
We agree a low fixed fee per hire upfront, averaging 6 to 9% of salary against the 20 to 25% typical of contingency recruiters. For an illustrative product manager on $105,000, the fee is $7,500. Part is an advance at the start, the balance on offer acceptance, and if we don't deliver a shortlist of at least 3 qualified candidates within 30 days, you can claim the advance back in full. See our pricing page and free hiring tools.
Frequently asked questions
Can a foreign startup employ someone in the Netherlands without a local entity?
Yes. An employer of record (EOR) can employ the person for you. If the candidate needs a highly skilled migrant permit, the EOR must be a recognised sponsor with the IND.
Can we hire on fixed-term contracts in the Netherlands?
Yes, but Dutch chain rules limit how many fixed-term contracts can follow each other and for how long, after which the contract becomes permanent. A transition payment is generally owed if you choose not to renew.
Should we offer the 30% ruling to a candidate moving to the Netherlands?
Do not promise it. The 30% ruling is a tax facility for some employees recruited from abroad, its rules have been changing and eligibility depends on the person. Check with a Dutch tax adviser.
Is English enough to work in a Dutch startup?
In most tech teams in the Netherlands, yes. English is widely used as the working language, though some customer-facing roles may need Dutch.
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