Comparing salaries across borders: why gross against gross misleads
A candidate earns €5,500 gross per month in the Netherlands. A German employer offers roughly the same amount when converted. On paper it looks competitive, yet it does not feel equivalent to the candidate.
That is understandable. In cross border recruitment, comparing gross pay alone says too little. An offer's value comes from the entire employment relationship: net effect, pension, healthcare and social security, holidays, mobility, bonus, contract type and the practical costs of working across the border.
Employers do not need to calculate every outcome themselves. They do need to make the relevant components visible and open to professional assessment.
Start with the working situation, not the salary
Where does the candidate live? In which country will work be performed? How many days at home and across the border? Is this regular cross border work, a temporary posting or a local employment contract?
According to the EU, the applicable social security system depends on the work situation and country of residence; an employee cannot simply choose it. A person living in one country and working in another faces different questions from a temporarily posted worker.
Establish the actual working week first. Only then can a payroll or mobility specialist assess the implications reliably.
Compare the full package in eight lines
Prepare an overview for employer and candidate that covers at least:
- fixed annual salary and payment frequency;
- variable pay and whether targets are realistic;
- employer pension contributions and any employee contribution;
- healthcare and other insurance;
- holidays, public holidays and leave arrangements;
- car, mobility budget, commuting and business travel costs;
- home working allowance and equipment;
- contract duration, probation and notice terms.
Show expected travel time and accommodation costs separately. A company car does not automatically make up for ten extra hours of travel each week.
Make variable pay fit a new market
A bonus plan that works in the home market may be unrealistic in a new one. Someone building the Netherlands or Germany from scratch needs time for positioning, networks and a local sales pipeline.
Use phases. Initially, qualified conversations, partner development and proposals may carry more weight; later, revenue and margin become more important. This rewards market building without lowering commercial expectations.
Do not promise a net figure without a personal calculation
Candidates understandably ask, “What will I take home?” A generic online calculator is often inadequate. Personal circumstances, place of residence, family, insurance and work pattern can all matter.
Communicate the full gross package and, once both sides are seriously interested, arrange an individual calculation by a qualified specialist. That is more credible than an optimistic net estimate that must later be withdrawn.
Consider the psychological comparison too
Candidates compare certainty and simplicity as well as money. A cross border role means adjusting to another language, different internal processes, travel and possibly extra administration. If the employer leaves that complexity with the candidate, the offer must feel noticeably stronger.
That need not always mean more pay. A fixed home working day, clear travel limits, local autonomy, more leave or expert setup support can be equally persuasive.
Transparency helps recruitment
A clear overview avoids surprises in the final stages. It helps candidates make an informed choice and protects employers from a hire that proves impractical after a few months.
Crossborder Consulting helps employers define the commercial role and candidate proposition for Germany and the Netherlands. Employers use their own or specialist advisers for tax, legal and social security matters. Read about Crossborder Recruitment.
This article gives general information, not legal, tax or social security advice. Consult a qualified specialist about individual circumstances.