Does your employer intend to terminate your employment contract? It's good to know employees are well protected under Dutch law. We'll explain in which cases your contract can be terminated, what a termination agreement is and what your rights are.
Deze pagina is ook beschikbaar in het Nederlands: Vaststellingsovereenkomst.
An employment contract is a legally binding document that ties you and your Dutch employer to an agreed set of terms. Your employment contract is the groundwork for a business relationship and determines the obligations of both parties. But if circumstances change or one can't meet the agreed terms, the parties involved must have an exit clause. Contract termination is legally ending a contract in cases where parties no longer want to collaborate or one party has breached the terms of the agreement. Only you and your employer can terminate a Dutch employment contract.
Terminating an employment agreement boils down to the intention to resign (employee) or to dismiss (employer). It marks the end of a working relationship and requires consideration as to ensure that all legal obligations under Dutch law are fulfilled. Pay close attention to things like the notice period (how far in advance notification needs to be given), a severance payment (like the statutory transition payment) and the right to a subsequent unemployment benefit. A commonly used contract to terminate an employment by mutual consent is the termination agreement.
A Dutch employer can terminate your employment contract is he has a valid reason to do so. For instance when you keep performing poorly, despite several warnings. Dutch labor law prescribes the permitted grounds for dismissal.
There are exceptions when it comes to contract termination. In some cases you are protected from dismissal. That might occur when you're ill, pregnant or recovering from giving birth.
In others, your employer doesn't need a valid reason to terminate your employment contract. For instance if you have reached retirement age or if you're still in your trial period.
Let's assume you're pretty fed up with your employer and you're willing to cooperate towards termination through (mutual) consent. It could actually turn out to be a positive thing when you're able to shift focus to a new job and enjoy a fair severance package.
If you and your employer mutually agree to terminate your labour agreement, you can aim for dismissal by mutual consent. You need to draw up a termination agreement to record the terms of your dismissal. You are not entitled to a statutory transition payment, but you do need to reach a final settlement. That usually contains arrangements about unused vacation days and a fair severance payment. Make sure to apply the correct notice period.
A less favourable possibility to end a labour contract is through termination with unilateral consent. This implies that your employer initiates your dismissal and you agree to it in writing. Although you are entitled to a transition payment, you are not able to negotiate about the terms of your dismissal. We discourage employees to agree to this procedure. It makes negotiating impossible and limits your rights to unemployment benefits once settled.
A termination agreement is a legally binding contract in which two or more parties make agreements to resolve or prevent a dispute. The termination agreement is popular in Dutch labor law because it ensures to settle a dismissal by mutual consent, without the intervention of the sub-district court or the UWV.
The Dutch refer to this type of contract as a vaststellingsovereenkomst. Commonly used terms in English are settlement agreement, termination agreement, termination proposal, severance package, final settlement and mutual agreement.
Most employers want to dismiss staff through a termination agreement (settlement agreement). Employers like this procedure because it enables dismissal by mutual consent. It is faster (and often cheaper) than applying for a dismissal permit from the UWV or submitting a petition to the sub-district court. There are also advantages for employees. You can negotiate about the contents of your dismissal proposal. Moreover, both parties know exactly what to expect after signing: the termination of the agreement followed by dismissal. A decision by the UWV or ruling by the sub-district court judge is often black or white, while you can find middle ground in consultation with each other. Contact our labor lawyers for free if you intend to resign or if you've just received a termination agreement.
Have you just received a settlement agreement or are you willing to resign based on mutual consent? Have our labour lawyers perform a basic check to find out what's missing or should be improved. That doesn't cost you anything.
Is your (intended) dismissal justified?
Can your severance pay increase?
Unemployment benefits secured?
What are the correct legal steps?
We'll get started within 4 hours.
This basic check is free of charge.
If you object to contract termination, your employer needs to initiate a formal procedure with the Employee Insurance Agency (UWV) or the sub-district court. The submitted ground for dismissal determines which one of them has to grant their permission.
Your employer has to request a discharge permit to the Employee Insurance Agency (UWV) in case one of the following two dismissal grounds applies:
You can't get fired without a discharge permit. If the UWV doesn't grant permission, your employer has to turn to the sub-district court and start proceedings for dissolution of your employment contract.
For all other dismissal grounds (C to H) your employer has to send a request for dissolution to the sub-district court. A court judge will check if all of the relevant legal criteria have been met to terminate your agreement.
If your employer provides multiple grounds for your dismissal, they can be combined. A sub-district judge can be asked for dismissal on cumulative grounds (I). If granted, it's possible that you are entitled to an additional severance payment on top of the statutory transition payment.
The ground rule for qualifying for a (statutory) transition payment is that you can't be blameworthy. If your employer initiates the dismissal, you are probably entitled to this type of dismissal compensation.
You are entitled to a transition payment if your fixed-term contract isn't extended, if you are dismissed via the UWV or the sub-district court on valid grounds or if you resign following serious culpable conduct or negligence on part of your employer. You may even be eligible for fair compensation.
If you resign yourself, if you agree to dismissal by mutual consent or if you are to blame for your dismissal (due to culpable conduct or negligence), you are not entitled to a transition payment. With our help and a proper termination agreement you could however still succeed in obtaining a fair severance payment.
You might have these questions if you're considering resignation or are confronted with contract termination.
We are happy to inform you about your legal rights in case you are confronted with contract termination. You can call us free of charge. If you fill out the form below, we will call you back at an appropriate time.