Minimum wage increase and
introduction of minimum hourly wage

The legal minimum wage is indexed twice a year, on 1 January and 1 July. It was recently announced that the legal minimum wage will be increased by 3.75% on 1 January 2024. From 1 January 2024, the statutory gross minimum hourly wage for employees aged 21 and over will be €13.27 per hour. As well as this increase, the government is also introducing the statutory minimum hourly wage, which will bring about changes to many salary levels in collective labour agreements. In this article, we explain the implications for you as an employer.

Transition from monthly wage to statutory minimum hourly wage

In addition to the increase in the statutory minimum wage, the statutory minimum hourly wage will be introduced from 1 January 2024. This means that fixed minimum daily, weekly and monthly wages are no longer prescribed by law. However, the scope of full-time employment may vary by sector (e.g. 36, 38 or 40 hours per week). The same minimum monthly amount will now apply in all these cases. This means that a 40-hour-per-week job is actually currently still subject to a lower hourly wage than a 36-hour-per-week job. This inequality will be a thing of the past as of 1 January 2024.

Tip: All gross amounts of the minimum hourly wage for 1 January 2024 are shown in this table.

What does this mean for you as an employer?

The introduction of a statutory minimum hourly wage means that many pay levels need to be adjusted in collective labour agreements. In particular, salary levels at minimum wage level need to be recalculated because there are no longer fixed monthly, weekly or daily amounts.

The minimum wage per period (week, four weeks or month) is calculated by multiplying the number of hours worked during that period by the statutory minimum hourly wage.

Minimum youth hourly wages derived from the statutory minimum hourly wage apply to employees aged between 15 and 20.

The payslip must state the applicable statutory minimum hourly wage, which is appropriate to the employee’s relevant age and the period covered by the payslip.

What does this mean for the LIV?

There is a right to low-income allowance (LIV) for employees who have worked at least 1,248 hours for an employer during a calendar year and have an average hourly wage between 100% and 125% of the statutory minimum hourly wage. From 1 January 2024, the upper limit of the hourly wage criterion will be reduced from 125% to 104% of the statutory minimum hourly wage. Incidentally, the Dutch government plans to abolish the LIV from 1 January 2025.

Tip: The introduction of the minimum hourly wage means that adjustments need to be made in payroll records, employment contracts and collective labour agreements. We can of course help with this.