Since 1 January 2017, all Dutch civil servants receive variable compensation under a new scheme. This is one of the key measures from a previous three-year agreement with trade organisations and local authorities. The programme has been mainstreamed after proving to be very successful in the departments that tested it.

Three bonuses (the summer holiday, year-end and career contribution bonuses), which correspond to 8%, 6.75% and 1.5% of annual pay, respectively, have been combined into a single instrument, with an additional 14.40 hours of paid leave (i.e. 0.8%) being added.

What makes this “IKB” (Individueel Keuzebudget) unique is the fact that each employee can decide how to use the total sum now allotted to him or her each year.

They can choose any combination of the following options:

 • convert a portion into additional paid leave (calculated proportionally to their annual pay), limited to 144 hours p.a. FTE

• make an additional contribution to their pension fund, in order to boost their future pension

• finance their commute or individual training initiatives not paid for by the employer

• request payment in cash (on a monthly or year-end basis)

Note that the first three options are tax free, making this scheme more attractive.

The main goal of this new system is to respond to employees’ changing needs depending on their age, family situation and career advancement.

Choices are entirely individual and can be made each year on the p-direkt HR portal.

Recently, the Dutch government decided to roll telework compensation into the IKB. As from January 2020, teleworkers will receive €80.23 in monthly compensation for use of their personal space and €1,815 every five years for the purchase of equipment for working at home.

With teleworkers comprising 13.7% of the Dutch workforce, the Netherlands is already the EU leader for telework and the Dutch government expects a sharp increase in the public sector thanks to this increased flexibility.

For more information: rijksoverheid.nl (in Dutch)