A contractor billing €500 a day in France does not earn paid leave on top of that rate. The money comes out of what they invoice, and the portage company either sets it aside month by month or pays it as an indemnity when leave is taken.
The mechanism differs by country, but the principle does not. Your holiday money was included in your invoicing before it appeared on your payslip.
Contractors who negotiate a day rate on the assumption that the quoted amount will arrive in full every month find out the difference the first time they take two weeks off.
This guide covers what each country guarantees, how the money reaches you, and what happens to it when an assignment ends.
Key takeaways
- Holiday pay under an umbrella, portage or staff leasing arrangement is funded from what you bill, not paid on top of it. The provider deducts it from your invoicing before it reaches your net pay.
- Assignment-linked contracts pay out your leave balance and reset to zero every time a project ends. A permanent contract keeps accruing leave between assignments, so the time you spend finding your next project still counts toward it.
Your holiday pay is your own money
Under an umbrella, portage or staff leasing arrangement, the provider is your legal employer and, as such, owes you paid annual leave. The provider funds that from your invoicing, because there is no other source.
This is different from the management fee. In portage salarial, the provider either sets money aside each month so your salary continues while you are on leave, or pays a holiday indemnity of 10% of gross pay. Either way, the money originated with your client.
This is not the financial reserve, which does something else. Article 21 of the Portage Salarial Collective Agreement requires a separate reserve of 10% of base salary for permanent contracts, held on your activity account. That reserve, calculated excluding holiday indemnities, is there to cover drops in income between assignments and is released as a prospecting allowance.
What each country guarantees
France
Employees accrue 2.5 working days of paid leave per month, giving 30 working days, or five weeks, per year. Holiday pay is calculated two ways, and the employer must pay whichever is higher: one-tenth of total gross pay over the reference period, or the salary you would have received had you kept working. Unless a company or sector agreement says otherwise, the reference period runs from 1 June to 31 May.
Spain
Article 38 of the Estatuto de los Trabajadores sets a minimum of 30 calendar days per year, and states that paid annual leave cannot be substituted by financial compensation. Thirty calendar days works out to roughly 22 working days, and the money-instead-of-leave prohibition applies for as long as the contract is running.
Netherlands
There are two entitlements here, and contractors routinely run them together. Statutory leave is four times your weekly hours, so 160 hours a year on a 40-hour week. On top of that, the Wet minimumloon en minimumvakantiebijslag sets holiday allowance at 8% of pay, due by June. One is time, the other is cash, and receiving one does not reduce the other.
If you're a high earner, make sure to read the contract on the second one. Above three times the minimum wage, the allowance can be reduced or dropped on the portion above that line, but only if you agreed to it in writing. On a contractor day rate, a meaningful portion of your income can be above that limit.
Belgium
Your holiday entitlement in any year is earned by work done the previous calendar year, called the vakantiedienstjaar, or exercise de vacances in French-speaking Belgium. A full year of full-time work gives 20 statutory leave days on a five-day week, with normal salary paid during those days. Double holiday pay adds 92% of gross monthly salary, prorated at one-twelfth per month worked in the previous year. It is normally paid in May or June, regardless of when you take your main holiday.
Variable earnings are handled separately. Double holiday pay on variable earnings is 92% of one twelfth of what you earned in variable pay over the preceding twelve months, which works out to 7.67%.
Switzerland
Article 329a of the Code of Obligations sets 4 weeks of service per year as the minimum, rising to 5 for employees up to age 20. Where holiday pay is added to an hourly wage, the standard supplements are 8.33% for four weeks, 10.64% for five weeks, and 13.04% for six weeks.
Swiss law prohibits paying out holiday in cash during employment, and case law permits it only as an exception for irregular part-time work. Where it is permitted, the courts require the holiday supplement to be stated separately in the employment contract, and holiday compensated in cash without meeting those conditions counts as untaken, meaning the employer may have to pay it a second time at the end of the relationship. Transparency on the payslip matters for the same reason.
What happens to your leave when a project ends
EU law and Swiss law separately permit paid annual leave to be replaced by a cash payment in one circumstance only: termination of the employment relationship. Untaken days are settled at that point.
On an assignment-linked arrangement, that happens every time a project finishes. The balance is paid out, accrual restarts at zero, and the weeks between one assignment and the next produce nothing. Belgium formalizes this with departure holiday pay, which the next employer then deducts from what it owes you. Someone completing four separate six-month engagements over two years never reaches a point where a substantial balance exists to take as time off.
Permanent contracts work differently. The employment continues between clients, so the balance carries and accruals continue while you look for the next project. The three weeks you spend finding work still build entitlement, and accrued holiday pay during a previous assignment remains available when you take a break.
That's what ultimately decides whether paid leave is a benefit you use or a series of small payouts you never convert into time off.
Why there's no holiday pay in the UAE
Under Federal Decree-Law No. 33 of 2021, private sector employees are entitled to at least 30 days of fully paid annual leave per year of service, and 2 days per month for service lasting between 6 months and 1 year.
None of that reaches freelance permit holders. Cabinet Resolution No. 1 of 2022 defines freelancing as an independent and flexible work arrangement and states that the freelancer is in no way a worker for the individuals or companies they serve, which is why freelancers are not entitled to annual leave, sick leave or public holiday pay. Health insurance is also your own responsibility, not your employer's, and is often required for your residence visa.
Questions to ask before you sign a contract
- Does the quoted rate include the holiday reserve, or is it excluded?
- Is holiday pay a separate line on the payslip?
- What happens to untaken leave if the assignment ends mid-year?
- In the Netherlands, will the provider flag statutory days before they expire on 1 July?
Employment that doesn't reset between projects
With Hightekers, you hold a full-time permanent employment contract while keeping your own clients and setting your own rates. Leave accrues continuously rather than resetting at the end of each project. You take home up to 70% of what you bill before tax, business expenses are uncapped, and your salary arrives every month, whether the client has paid or not.
Join Hightekers and see what continuous employment would mean for the leave you currently lose between assignments.
FAQ
Do umbrella contractors get paid holiday?
Yes. Anyone employed through an umbrella, portage or staff leasing company has an employment status, which comes with a statutory right to paid annual leave in every EU country and in Switzerland. It is a legal minimum, not something a provider chooses to offer.
Is an umbrella holiday pay extra money on top of your day rate?
No. The provider funds it from what you invoice, either by setting money aside throughout the year or by structuring the rate so the reserve is excluded from it. Your annual income is the same either way, but the monthly distribution differs.
What happens to unused holiday when a contract ends?
It gets paid out. EU law allows leave to be converted into pay only when the employment relationship terminates. Under an assignment-linked contract, that point arrives at the end of every project.
Can you ask for the money instead of taking the leave?
In most cases, not while you remain employed. Spanish law states the holiday pay entitlement cannot be substituted by financial compensation, and the Working Time Directive applies the same restriction because paid leave exists to let workers rest and take a period of relaxation.
