Observation (CEACR) - adopted 2011, published 101st ILC session (2012)

Employment Policy Convention, 1964 (No. 122) - Netherlands (Ratification: 1967)

Other comments on C122

Observation

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Articles 1 and 2 of the Convention. Implementation of an active employment policy. The Committee notes the information provided in the Government’s report for the period ending in June 2010 and the comments submitted by the Confederation of Netherlands Industry and Employers (VNO–NCW), the Federation for small and medium-sized businesses (MKB–NL), and the Netherlands Trade Union Confederation (FNV). The Government indicates that the Dutch economy was hit relatively hard by the global financial crisis in September 2008, resulting in a historically large decline in economic growth of 4 per cent in 2009 and the effects of the negative economic developments can be observed in the labour market: unemployment rose from 3.9 per cent in 2008 to 4.9 per cent in 2009 and 5.4 per cent in 2010. The unemployment rate was measured at 5.1 per cent in June 2011 and 5.3 per cent in July 2011. Furthermore, Statistics Netherlands provides data indicating that the number of unemployed men in the age category 25–45 has more than doubled over the past three years: from 46,000 in the second quarter of 2008 to 99,000 in the second quarter of 2011. The Government indicates that before the crisis the main goal of employment policy was to increase the employment rate to solve problems caused by an ageing labour force and society, such as labour shortages and deficits in public finances. It further states that despite the economic crisis, the underlying structural challenges have not fundamentally changed; if anything, they have intensified. Increasing participation remains as important as before. The Committee notes the main crisis measures introduced to help employers deal with the impact of a sudden drop in demand: the Special scheme for the reduction in working hours (bijzondere WTV), and its successor, the Partial unemployment benefit (deeltijd WW). The Committee notes the comments submitted by the FNV indicating that the focus of the government policy is on higher participation. According to the FNV, both the Government and employers should pay more attention to the slowing growth in productivity. The FNV further states that, although the regulation concerning dismissal did not change, employment security declined due to the extension of the number of temporary contracts a company is allowed to offer an employee before the company is obliged to offer a permanent contract. This further increases the number of people with a flexible contract, the same group of workers that were already hit hard by the crisis. The FNV also points out the steadily declining share of labour in national income, which is seen as a clear indication that wage increases in the Netherlands have been moderate in comparison with economic growth. The Committee invites the Government to provide information in its next report on the impact of the measures taken on employment generation and in particular to indicate how such measures are decided and kept under periodical review within the framework of a coordinated economic and social policy. It also invites the Government to provide information on employment policy objectives with regard to productivity and the development of wages.

Older workers. The Committee notes that an important goal of the Government is to increase the employment rate and to improve the labour market position of older workers. It notes that the labour participation rate of persons aged between 55 and 64 rose from 50.9 per cent in 2007 to 53 per cent in 2008 and 55.1 per cent in 2009. The Government indicates that it used a variety of policy instruments to reach the goal of increased participation of older workers aimed at both the supply and demand side of the labour market. These include financial incentives for employers and changes to the statutory retirement age. The FNV states that the position of older workers has not improved in recent years and highlights the need for a better analysis of the labour market for this particular group of workers. The Committee invites the Government to provide information on the effectiveness of the various measures implemented to increase employment opportunities for older workers.

Youth employment. The Government indicates that a consequence of the crisis was to negatively impact, to a greater extent, employees with temporary or flexible contracts or self-employed persons. Groups that are relatively most often working in flexible jobs are young people and ethnic minorities. The Committee notes that the Government introduced the Investment in the Young Act with the aim of promoting sustainable participation by young people. The Act requires municipalities to provide an offer for work or learning to jobless young people up to the age of 27 who request social assistance. Furthermore, the Invalidity Insurance (Young Disabled Persons) Act (Wajong) was adopted in January 2010 in order to offer maximum support to young people who do not have prospects of work, helping them find and retain jobs. The FNV raises concern on the quality of the education, training or jobs available to all young workers targeted by these measures. The Committee asks the Government to report on the effectiveness of the various labour market measures implemented to meet the employment needs of young persons and to provide further information in light of the concerns raised by the FNV.

Ethnic minorities. The Government indicates that the relative labour market position of ethnic minorities is quite dependent on the economic situation. Before the crisis their employment rate was growing faster and the decrease of their unemployment rate was more substantial than for other groups. In 2009, the unemployment rate for ethnic minorities rose for the first time since 2005. The Committee notes that the Government chose to improve the underlying factors that cause the weaker position of ethnic minorities, such as lower educational attainment. They will benefit from general measures to prevent school leaving and improve the employability of workers. The Government also indicates that the labour market position of ethnic minorities will be improved by other measures taken, such as the Integration Delta Plan. The Committee invites the Government to continue to provide information on the employment situation of ethnic minorities as well as on measures taken to improve their participation in the labour market.

Article 3. Cooperation with social partners. The Committee notes that, although the crisis had a negative impact on the employment rate, the Government remains committed to the target agreed with the social partners of achieving an employment rate of 80 per cent in 2016. The Government indicates that a social summit was held on 24 March 2009 on how to combat the effects of the crisis on the labour market. The main topics were to prevent long-term unemployment, promote a responsible development of labour costs and improve the sustainability of public finances and the Dutch pension system. The Government revealed its plan to increase the statutory retirement age from 65 to 67 years and gave the social partners the opportunity to come up with an alternative plan. The FNV indicated that it strongly opposed the Government’s plans to raise the statutory age to 67 years. In this regard, employers and trade unions, after an initial failure to come to an agreement, have made a better and more robust plan to come to a sustainable retirement scheme. Part of this agreement is to improve the position of older workers in the labour market, as people will work until a later age in the decades to come. The Committee invites the Government to continue to report on consultations held with representatives of employers’ and workers’ organizations and representatives of other sectors of the economically active population involved in the formulation and implementation of active employment policies.