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This is fascinating, although I still feel there's too much disagreement for me to have a clear picture of how this works in California. I'll give a Dutch pers
by mercer 6y ago
This is fascinating, although I still feel there's too much disagreement for me to have a clear picture of how this works in California.
I'll give a Dutch perspective (which perhaps applies to some degree to other parts of Europe):
Until 2016, clients had to proactively ask for a 'Verklaring Arbeidsrelatie (VAR)'. An 'explanation of the work relationship'. If I understand correctly, the contractor/freelancer had to prove that they had more clients than just that one, and it had to be reasonable. So no having five clients of which one accounted for 99% of all income.
If a client didn't ask for this 'VAR', it could cause problems down the road.
From 2016 on they changed this, but apparently the result has been a confusing mess, so in 2021 they'll try to clear up some of it.
Practically speaking, as a contractor, I've found that only the big clients (with legal teams, I imagine) would ask for a VAR, if at all.
Most of the time, whether working in Holland or Germany, I usually did the exact same work that their employees did. In some cases there seemed to be vague distinction where I worked on shorter projects and they did support and the like, but in practice that distinction was very blurry.
I suppose with some of these clients I could've caused trouble, but because I got paid well, often better than the full-timers (even with insurance and all that deducted), I didn't see any reason to.
My general impression is that NL is a bit more 'liberal' in these matters than many other parts of Europe, so I'd be curious to hear how this works in France/Germany/Italy, etc.
- MartijnBraam 6y agoOutside of the VAR thing there already was laws that contractors can't make more than x% of their income from a single customer. If they do the customer would have to treat you as an employee.
- mongol 6y agoDoes this apply also for incorporated /limited liability corporations owned by the contractor, in the Netherlands? In Sweden, if you want to become contractor, you have two options - start a limited liability company of which you owns all shares (Aktiebolag). Or you can start a business in your own name (Enskild firma), which legally is not separate from your own liabilities. In the first case, you are making yourself employed by the corporation you own. I do not know if there is any legislation that prevents that business from having just a single customer. But I know that in my own case, my business have had a single customer the entire time it has existed.
- mercer 6y agoI don't know and am curious too, so I'll probably look into it at some point. But I strongly suspect that this is one of those 'spirit of the law' situations. So I suspect that a company that doesn't want, well, liability, would avoid hiring an LLC that really is just one person working only for said company.