“Invest now in modern social security for everyone”

The share of self-employed workers in the labour market has been increasing for decades, says Houweling: “Actually, since the nineties, the share of self-employed on the labour market has constantly been growing every year, and in the last five years, this group has come into view and maybe has grown even faster. One way or another, it is a quite constant flow that we have stimulated ourselves with all kinds of tax measures.”

Being self-employed often results in a higher hourly wage. Still, when independent workers get sick or cannot work, they usually have no social security to fall back on. “In the Netherlands, everyone is entitled to a state pension, whether you were an employer or a self-employed worker. Everyone assumes they will reach retirement age, and we still have a national insurance system. The risk of getting sick is also real. Employees are protected from this through their employer (two years of paid sick leave, reintegration, and, after that, there is a social security system to fall back on). However, the same self-employed worker has the same risk and has to work it out themselves. Why is insurance against ageing considered so natural, but insurance against incapacity to work not?”, Houweling wonders.

Two birds, one stone

The Professor of Labour Law sees opportunities for both employers as self-employed workers by unlinking the social security system – which currently is arranged through the employment contract between an employer and the employee – and making it available to all workers. Self-employed workers do not have an employment contract and therefore are not entitled to, for example, unemployment or illness benefits that are available to employees. Self-employed workers could insure themselves against these risks, but the premiums of these insurances are costly. At the same time, employers pay for their employee’s insurance premiums, making self-employed workers cheaper to hire than employees.

There is a solution, according to Houweling: “it would be wise to unlink social security from employment contracts. Everyone is insured from their eighteenth birthday against liability, but maybe we should do the same for risks that could occur in working life. If we would [collectively] insure everyone against incapacity to work, we would have ten million insured workers. This system would not just be a good alternative for the self-employed because they get affordable insurance against incapacity that could benefit them; it would also take some of the sensitive dossiers away from the employers, amongst which are the two years of paid sick leave.”

In the ideal labour market, there would be no difference between self-employed workers and employees in terms of entitlement to social security, Houweling says: “If we were to start with a clean sheet, we could get the social security away from the employment contract, and we should arrange social security for all workers.”