The long-running story called 'Wet DBA', got another new chapter in December 2018: the assessment of a relationship of authority. After the Cabinet sent the guideline to the House of Representatives in late November 2018, this memorandum was incorporated into the Tax and Customs Administration's 'Payroll Tax Handbook' on December 12, 2018. This gave it the status of "applicable policy. There is currently unease in the flexible labor market about how this proposal became policy without the intervention of the House of Representatives.

Hannah Dias, manager of tax advice at BDO, is surprised at these noises. "The policy is based in part on various rulings by judges who have addressed the issue of whether or not an employment relationship exists. It is a summary of already existing legislation and case law. In that respect, it is therefore not surprising that the House of Representatives is not familiar with it." She considers it a greater risk that the prevailing policy may cause a Principal to be classified as malicious more quickly. "This can be detrimental to organizations, as malicious parties may also be subject to retrospective taxation for the past. Since the publication, Principals can hide more difficult behind 'I didn't know,' because everyone can read in black and white what the Inland Revenue considers a relationship of authority."

Noise at 40 indicators
The cabinet promised to come up with a clarification of the definition by January 1, 2019. It succeeded in doing so through the previously described "directive on assessing the employer-employee relationship," but this has not provided the clarity the market craves. "For example, it is frustrating for organizations that the various factors indicating whether or not there is a relationship of authority must always be considered in relation to each other. That leaves room for interpretation," Dias said. She gives the following examples in this regard:

  • Assessment using more than forty indicators is complex. Moreover, it is not immediately clear what weight and relevance is assigned to each element and how these elements should be assessed in relation to each other.
  • Some elements of the directive are so ambiguous that only judges and other labor law specialists can understand and apply them correctly. Their role is important here. Do they ask questions properly? What (new) facts are ascertained? And what value is placed on facts? Because these are customized cases, a uniform outcome is not guaranteed.

Organizations create policies
Dias emphasizes that the best way for organizations to deal with this is to (re)establish a hiring policy. Some organizations take this further than others, based on different interpretations of signals reflected in public policy. "It is about organizations showing - in good faith - that the hiring process is well thought out and trying to implement laws and regulations in this process as well as possible. You do this on the one hand by identifying risks and securing them, on the other hand by minimizing the extent of risks as much as possible and, for substantiation, recording everything in a file." According to Dias, a review of paper and practice is the starting point here. "Stay in control, through a good policy on the one hand and a corresponding implementation in practice on the other," Dias said.

Working DBA-proof
Dias understands that this is not always easy and therefore recommends seeking help from a consultant. "Organizations are increasingly knocking on the door for an analysis and advice on the hiring policy. I guide, together with HeadFirst, trajectories to ask, for example, questions such as 'For which functions do I hire external workers?', 'When can an external worker perform an assignment as a zzp'er?' and 'Is it a matter of temporary replacement or is it a defined project with an agreed result?' central." She continues: "HeadFirst, together with the Client, has a signaling function to assess and ensure that an assignment - before and during execution - is suitable for an Independent Professional. In cases of doubt, HeadFirst keeps a close eye on the situation and we think along in detail about a better interpretation. It is important that clients are open about all relevant facts and circumstances. Of course Independent Professionals are also tested to make sure that they are characterized as real entrepreneurs."