Personnel matters practically in order: everything you need to know

HR administration for SME limited companies: contracts, payroll administration, absenteeism, file management, GDPR compliance, CLA aspects. For growing SMEs, HR quickly becomes complex — initially in-house, later via an HR employee or outsourced. Below is an overview of the minimum requirements, pitfalls, and when professional HR support pays off. Tessa, with 12 employees, goes through the list.

The short answer

• Contracts: employment contract per employee, in line with the WWZ, GDPR, and collective labour agreement.
• Payroll administration:payroll tax, employee contributions, holiday pay.
• Absenteeism: occupational health and safety service, sickness absence administration, reintegration (Gatekeeper).
• Personnel file: GDPR compliant, limited retention period.
• Ongoing: compliance with the collective labor agreement, performance reviews, training plan.

1. Employment contracts

Per employee: written employment contract with statutory requirements — position, salary, working hours, vacation, notice period, and any CLA designation. Plus optional clauses: non-compete clause, confidentiality, transfer of intellectual property.

For SME BVs: standard template + customization per function. Periodically reviewed in the event of legislative changes.

2. Payroll administration

Monthly:

• Salary payment by bank transfer.
• Payroll tax to the Tax and Customs Administration (wage tax + employee insurance contributions).
• Payslip with specification.
• Reservation for holiday allowance (8%), optional 13th month.

Many SME companies use a payroll administrator (Loyalis, ADP) or HR software (Personio, AFAS, Visma Raet) for automation.

3. Absenteeism management

Legally required: occupational health and safety service contract for company doctor and prevention. In case of sickness absence:

• First day of reporting sick: inform the company doctor.
• 6 weeks: problem analysis by company doctor.
• 8 weeks: employer + employee action plan.
• 13 weeks: sick leave notification to UWV.
• 1 year: 1st-year evaluation.
• 104 weeks: end of continued salary payment, possible WIA.

Gatekeeper Improvement Act: active reintegration — avoids UWV sanctions (extra year of continued salary payment).

4. Personnel file (GDPR)

Per employee file with:

• Employment contract and any adjustments.
• Proof of identity (copy, BSN not visible — masking).
• Personal details.
• Performance reviews.
• Absence administration.
• Courses and certificates.

GDPR aspects:

• Limited retention period: typically 2 years after termination of employment (statutory minimum), up to 7 years for tax aspects.
• Secure storage (digital with encryption).
• Access restricted to HR and the immediate supervisor.
• Employee right of access.

5. CLA compliance

In the case of a mandatory sector-wide collective labour agreement: provisions apply immediately. Important for SMEs:

• Salary scales.
• Pension contributions.
• Holidays.
• Possibly a 13th month.
• Specific rules (holiday allowance, year-end bonus).

Non-compliance with the collective labor agreement: employee wage claims, FNV actions, possible fines.

6. Performance reviews and appraisal interviews

Not legally required but HR-essential:

• Annual review with salary decision.
• Semi-annual performance review.
• Documentation in file.
• Personal development plan.

Good documentation is essential in the event of later dismissal or conflict.

When is HR support needed?

Honest recommendation

For growing SMEs: invest early in HR software (€5–€15 per employee per month) — automates absence management, payroll administration, and file management. For complex situations (dismissal, conflict, sick leave), have a remote legal counsel. Do not underestimate GDPR compliance — fines are high and reputational damage is significant. For those over 50: Works Council obligation and full-time HR presence.

For other topics: legal scan of employment contracts, works councils , and employee monitoring.

Frequently Asked Questions