Vakantiegeld: the 8% Dutch holiday allowance explained

Vakantiegeld is a statutory holiday allowance every employee is entitled to, set at a minimum of 8% by article 15(1) of the Wet minimumloon en minimumvakantiebijslag. It is owed by the employer, it is taxed as pay, and it exists whether or not the employee takes any holiday. An employer that simply forgets it has underpaid wages rather than skipped a perk.

It is separate from holiday itself. The days come from article 7:634 BW, four times the agreed weekly working hours, which is 20 days for a full-timer regardless of whether the week runs to 36 or 40 hours. The 8% is money on top of the wage. An employee is entitled to both, and taking leave does not spend the allowance.

It is also not a 13th month. There is no statutory 13th or 14th payment in the Netherlands: the Dutch year is twelve monthly payments plus the vakantiegeld. A 13th month or an eindejaarsuitkering exists only where a CAO or the individual contract provides one, and the two can sit side by side on the same payslip. Anyone treating 8% as the local version of a thirteenth payment has also got the arithmetic wrong, because a thirteenth of the year is not 8%.

For an employer building a cost figure, the useful framing is that the 8% is pay and the employer social charges are something else again. Our post on the cost of hiring in the Netherlands puts both into one worked example.

On the loon the employer owes the employee for the period, and on certain benefits received during the employment. Article 15(1) WML sets the base as the wage payable by the employer plus benefits received during the employment under the Ziektewet, under articles 4:2b and 6:3 of the Wet arbeid en zorg, which are aanvullend geboorteverlof and betaald ouderschapsverlof, and under the Werkloosheidswet.

Two consequences follow, and both surprise foreign employers. The first is that a year with a long absence in it still builds vakantiegeld: the wage an employee retains during illness under article 7:629 BW is pay, and the statute separately adds Ziektewet benefit to the base. An employee who is off sick for months is still accruing the allowance on what they are being paid. The payment duty behind that is set out in our post on Dutch sick pay rules.

The second is that the base is wages, not total remuneration. Whether a bonus, an allowance or a variable payment belongs in the base is a question about what that payment is, and a CAO or the contract can define the base for itself. This is the part of a Dutch payroll instruction that has to be written down rather than assumed, because two employers with different wording will run different bases on identical salaries.

The reference period is a year. Article 15 WML expresses the entitlement as a percentage of the pay over the period, which is why a mid-year joiner earns a proportionate amount rather than a full year’s allowance in their first May.

The statutory 8% does not run all the way up the salary scale. Article 15 WML allows pay above three times the minimum wage to be left out of the calculation, so the statutory floor is quantified against the minimumuurloon rather than against whatever the employee actually earns.

In 2026 that puts the reference point at three times an hourly figure that changes twice a year. The minimumuurloon for workers aged 21 and over is € 14,71 an hour from 1 January 2026 and € 14,99 from 1 July 2026, reset each 1 January and 1 July by the Minister of SZW under article 14 WML. Three times the July figure is € 44,97 an hour. Our post on the Dutch minimum wage in 2026 has the youth rates and the indexation mechanism.

What the cap means in practice is narrow rather than dramatic. It does not stop an employer paying 8% on the whole salary, and most do, because the contract or the CAO says 8% of the annual salary without qualification. It means that on a high salary the part of the allowance above the reference level is a contractual promise rather than a statutory one, and the promise is only as good as the wording that carries it.

So the cap is a drafting question. Where a senior contract says nothing, an argument about the top slice is available. Where it says 8% of gross annual salary, there is nothing to argue about.

The reference point also moves twice a year, which is a second reason to write the percentage into the contract rather than the outcome of a calculation. An employer that fixes the allowance to a figure derived from the January minimum wage is working from a number that stops being current on 1 July.

There is no statutory payment month. This is the single most common misunderstanding about vakantiegeld, and the answer is not hidden in a subclause: articles 15 and 17 WML set the entitlement and the reference period, and neither of them names May.

What exists instead is an overwhelming market practice. The allowance is normally paid as a single amount in May or June, accrued over the period from 1 June to 31 May. That is what Dutch employees expect, what Dutch payroll calendars are built around, and what a Dutch candidate will assume unless the contract says otherwise.

Paying it monthly instead is possible, but it is the exception and it has to be agreed in writing. Employers reaching for the monthly option are usually trying to smooth cash flow or to make a headline salary look larger; both are legitimate, and both need the employee to have agreed to it in a document rather than in a conversation.

One practical note for a business new to Dutch payroll: because the allowance usually lands in a single month, it is taxed in that month under the tabel bijzondere beloningen rather than the ordinary monthly table, so the net amount an employee receives is smaller than 8% of their annual net. That is arithmetic, not a deduction anyone has invented.

Normally on top, and the contract still has to say so. Dutch salaries are quoted as a bruto maandsalaris or a bruto jaarsalaris excluding vakantiegeld by default, and the 8% sits on top of the quoted figure. The IND drafts its own salary thresholds the same way, stating them excluding the 8% holiday allowance. But this is market convention rather than a rule, and a contract can define the salary as inclusive. Every offer letter, quotation and calculator has to state which, in terms.

The gap is not trivial. On a base salary of € 48.000 for 2026, the CPB’s bruto modaal inkomen treated here as base salary excluding vakantiegeld, the 8% is € 3.840,00 and the total gross pay is € 51.840,00. An employer that believed the € 48.000 was inclusive has underpaid by € 3.840,00 a year; an employer that budgeted € 48.000 and owes € 51.840,00 is 8% over budget on every head. The same number is being read two ways.

This is the most common source of Dutch offer-letter disputes, and it is entirely preventable with one clause. Write the base salary, write the vakantiegeld separately as 8% of it, write the total, and let the candidate see all three figures before they sign. Our comparison of US and Dutch employer costs shows what the same salary looks like once both are in the budget.

Employer of Record Netherlands quotes the base salary, the 8% and the statutory employer charges as separate lines for exactly this reason, so that nobody has to reverse-engineer which convention a number was written in.

Only through a CAO, and only down to a floor. Article 16(1) WML allows a CAO or a public-law regulation to provide that the employee has no right to vakantiegeld, or a right to a lower amount. Article 16(2) then sets the limit: total pay plus vakantiegeld over the reference period must still come to at least 108% of the minimum wage the employee earned over that period.

An individual arbeidsovereenkomst cannot simply waive it. The deviation route runs through the collective agreement, which means an employer wanting to depart from the 8% first has to be inside a CAO that does so. In practice CAOs move in the other direction, improving on the statutory floor rather than cutting it, and a generally binding CAO can impose that improvement on an employer that never signed it.

That is worth checking before the first payroll rather than after it. The CAO’s own scope clause decides whether it applies, not the employer’s view of its own industry, and the SZW register at cao.minszw.nl is where that question is settled. A CAO can also add extra leave days, a wage scale and a 13th month, so the vakantiegeld question rarely arrives on its own.

There is one more reason to settle the question early. Vakantiegeld counts as pay for other purposes, so the number reaches further than the May payslip: it is part of total gross pay for the employer social charges, and the IND states its own salary thresholds excluding it precisely because everyone else includes it by default. Treating the 8% as an afterthought quietly moves several other figures.

For an employer with no CAO and no compulsory pension scheme, the position is simpler than it looks: 8% of pay, once a year, in a month the contract names. Getting it right costs nothing. Getting it wrong is back pay, and back pay in the Netherlands arrives with the allowance recalculated on top of it.