New Dutch Legislation Objective Grounds for Prohibiting Ancillary Activities.

The EU Transparent and Predictable Employment Conditions, entered into force on August 1, 2022, contains a prohibition on the clause in a Collective Labour Agreement, Employee Handbook or employment contract that prohibits the performance of ancillary activities (side activities) for others. ‘Others’ is referring to other parties, including the employee who performs work as a self-employed person.

The restriction for employees to perform ancillary activities for others can only be imposed if it can be justified by objective grounds. What does this mean?

The objective ground(s) may be justified, in relation to health and safety, the protection of confidentiality of company information, the avoidance of conflicts of interest or the threat of breach of the employer’s obligations under the Dutch Working Hours Act. However, this is a non-exhaustive list of objective grounds.

It is not necessary to include all the objective grounds for prohibition of ancillary activities in the current available company’s side activity clause in the employment contract or in the Employee Handbook. It is advised to include and thus adjust the clause stipulated the employer must give prior permission for the employee to perform the activity and conditions and/or restrictions may apply if the ancillary activity is in conflict with the justified objective ground(s).