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If you run a company in the Netherlands, you may have to work with collective labour agreements (CAOs). CAOs are collective agreements between employers (or employers organisations) and trade unions regarding wages and other conditions of employment. The government is not a party to these agreements.
Types of CAOs
A CAO can be concluded per company and per business sector. You must apply a CAO:
- if you have concluded it with the trade unions yourself
- if you are a member of an employer's organisation that has concluded a CAO
- if the Ministry of Social Affairs and Employment has declared a CAO binding to your sector.
If it concerns a minimum CAO, you may deviate from this if this is advantageous to your employees. Deviations from a standard CAO are not allowed. Many sector organisations offer the CAO relevant to their sector on their website.
CAO and employment contract
You must state in the individual employment contract whether a CAO applies. If the CAO and an employment contract are contradictory to each other, the CAO will prevail.