Smallest country in Europe has the highest percentage of employees working form home
The population density and the size of the Netherlands (ignoring the fact that it is not the smallest country of Europe in any kind of sense) is not an obvious factor for making more people work from home, since it should make it easier for people to commute to work.
The awful traffic and saturated road network though might play a role in this.
But joking aside, by none, really. The Netherlands is very dense, and indeed quite small, but it's not the smallest by any common metric - size, population, economy.