Declaration of employment relationship: clarity and certainty now a fact.

Many franchise relationships contain a limited or significant risk of a disguised employer/employee relationship (fictitious) employment. To prevent this risk, legal practice has a number of instruments at its disposal. One of those instruments is an adequate and, above all, relevant Declaration of Employment Relationship (var). This so-called var statement serves to prevent the creation of a (fictitious) employment relationship. Please note that this does not only concern the relationship between the franchisor and the franchisee. Such an unpleasant situation can also arise between the franchisee and the principal / customer. If that is the case, an obligation arises for payroll tax and employee insurance contributions. However, if it is obvious that the franchisee is self-employed, this will not be done. The var therefore provides clarity about the tax position and status of the franchisee and thus also about his independent status.

A bill has now entered into force which entails that the new var statement will lead in an absolute sense to an indemnification against any premium levy and wage tax levy, unless there is fraudulent conduct on the part of the applicant. Contrary to what was sometimes the case in the past, absolute legal certainty has now been created by the legislator. The franchisee can request the var statement from the tax authorities.

In the interest of the franchisor, franchisee and the client / customer, it is important to create this legal certainty in advance and to communicate clearly. In this way (major) work problems are prevented and the work can be carried out without any problems for the duration of the var statement. The new bill now guarantees clarity and legal certainty in the interests of all parties involved.

Ludwig & Van Dam franchise attorneys, franchise legal advice