Introduction
The Netherlands has positioned itself as a leading destination for highly skilled professionals in a competitive global labor market. The Dutch government, recognizing the importance of international talent, has developed a structured immigration system to attract and retain these workers. One of the most prominent pathways is the Highly Skilled Migrant (HSM) scheme, introduced in 2004. This program offers an efficient and business-friendly approach for foreign professionals to live and work in the Netherlands.In 2024 alone, more than 21,000 "Knowledge and Talent" applications were submitted to Dutch immigration authorities, with a significant number falling under the HSM scheme. However, with the benefits of this program come specific responsibilities and regulatory compliance for both employers and employees.
Employer Obligations Under the HSM Scheme
To employ foreign workers under the HSM scheme, companies must be designated as "Recognised Sponsors" by the Dutch Immigration and Naturalisation Service (IND). This status grants employers expedited processing of applications and access to international talent pools. However, employers must adhere to strict compliance requirements, including:- Ensuring that employees meet the salary thresholds set by the IND.
- Notifying the IND of any changes in employment status.
- Maintaining accurate records related to the employment and residency of their foreign employees.
Employee Responsibilities and Compliance
Once an employee is granted an HSM residence permit, they must comply with several conditions to maintain their legal status:- Registering with a Dutch municipality upon arrival.
- Receiving a set salary level monthly, which must be directly deposited into their bank account.
- Informing the IND of any changes in employment or personal circumstances.
- Adhering to restrictions on the duration and frequency of stays outside the Netherlands.
Salary Requirements and IND Monitoring
One of the key pillars of the HSM scheme is the salary threshold, which both employers and employees must respect. The salary must be:- Paid in full each month.
- Deposited into the employee’s Dutch bank account.
- Kept above the minimum threshold as defined by Dutch authorities.
Challenges: (Un)Paid Leave and Sick Leave
Employers and employees must navigate several challenges related to leave policies and salary thresholds. One key issue is how different types of leave impact an employee’s legal status under the HSM scheme.Exceptions to the Salary Requirement
Certain types of statutory leave as defined under Dutch labor law (WAZO) are exceptions to the salary threshold requirement. These include:- Maternity, paternity, adoption, and foster care leave.
- Family care leave.
Additionally, highly skilled migrants exercising their right to strike (“stakingsrecht”) may also temporarily fall below the salary threshold without repercussions.
For such cases, both the employer and employee must:
- Notify the IND within 28 days.
- Provide proof of eligibility for the statutory leave.
- Maintain accurate records of all (un)paid leave and strikes.
Sick Leave Complications
Sick leave presents a unique challenge for HSM permit holders. Under Dutch labor law, employers are required to pay at least 70% of an employee’s salary during illness for up to two years. However, there is currently no immigration exemption for sick leave, meaning that if an employee's salary falls below the HSM threshold due to illness, their residence permit may be at risk.This creates a conflict between Dutch labor and immigration laws. Employers must carefully manage compliance to avoid permit revocation while still meeting their legal obligations under labor law.
Conclusion
The Highly Skilled Migrant scheme offers significant advantages to both employers and international professionals, facilitating a streamlined process for work and residence in the Netherlands. However, the program comes with strict obligations related to salary, leave, and compliance. Both employers and employees must remain aware of these requirements to avoid potential legal complications.Pros and Cons Summary
Pros:
- Fast-tracked immigration process for highly skilled workers.
- Simplified procedures for Recognised Sponsors.
- Clear salary requirements ensure fair compensation.
- Certain types of leave (maternity, paternity, and care leave) do not impact residency status.
- Strict salary compliance, monitored closely by the IND.
- Sick leave creates a legal conflict between labor and immigration laws.
- Employers must invest in compliance management to avoid penalties.
- Non-compliance can lead to residence permit revocation and legal residency gaps.