Understanding Termination of Employment under Dutch Law

Learn about the legal requirements and procedures for terminating employment under Dutch law.

Are you in need of expert legal advice and assistance regarding employment termination? Look no further. At Fennek Advocaten, we are dedicated to providing comprehensive and professional services to both employers and employees. With offices conveniently located in Amsterdam, Alkmaar, and Hoorn, our team of experienced lawyers specializes in employment law, ensuring that you receive the guidance and representation you need. Whether you require assistance with drafting or reviewing a Voluntary Severance Agreement, or you find yourself embroiled in a complex dismissal procedure, we are here to help.

Understanding Employment Termination under Dutch Law

Employment termination encompasses all the regulations and case law pertaining to the conclusion of an employment contract. Termination can occur for various reasons, and with ever-changing legislation and regulations, the field of employment law can be intricate and challenging to navigate. Our team of employment law specialists at Fennek Advocaten stays up-to-date with all the legal frameworks and developments related to employment termination. We provide support and guidance to both employees and employers alike, offering expert advice and representation. Whether you have received a dismissal letter as an employee, have been terminated on the spot, or are an employer facing a reorganization or complex dismissal procedure, our dedicated team is here to assist you.

Termination by Employee in the Netherlands

If you are considering resigning from your position, you have the option to terminate your employment contract verbally or in writing. In most cases, the notice period is one month. However, it is important to honor any longer notice period specified in your contract or collective bargaining agreement (CAO), if applicable.

Severance Pay in Employee Termination under Dutch law

When an employee resigns, they are not entitled to receive severance pay. However, if you believe that your employer has acted wrongfully or negligently, you may choose to request the dissolution of your employment contract through the cantonal court. In such cases, you may be eligible for a "reasonable compensation."

To determine whether you are eligible for such compensation, feel free to contact one of our labor law attorneys for a consultation.

Termination by Employer in the Netherlands

If you, as an employer, wish to terminate an employee with a permanent contract, and there is no basis for immediate dismissal or mutual agreement, you must provide a valid legal reason for termination. The legal grounds for dismissal are stipulated in Article 7:699, Section 3 of the Dutch Civil Code (BW), and they are exhaustive, meaning that termination on other grounds is not permitted.

Grounds for Termination of Employment under Dutch Law

The following are the nine grounds for dismissal listed in Article 7:699, Section 3 of the Dutch Civil Code (BW):

a. Economic reasons 

b. Prolonged illness or disability (lasting longer than 2 years) 

c. Frequent sickness absence/regular disability d. Inadequate job performance 

e. Blameworthy conduct or neglect of duty by the employee 

f. Refusal to work due to conscientious objection 

g. Disturbed working relationship 

h. Other grounds

i. Combination of grounds

If you wish to terminate an employment contract based on grounds "a" or "b," you must request permission from the Employee Insurance Agency (UWV) before giving notice. For termination based on the other grounds, you must file a petition with the cantonalcourt to dissolve the employment contract.

Termination Due to Retirement Age in the Netherlands

Termination of an employee who reaches the statutory retirement age is a unique situation. You can unilaterally terminate the employment contract without having to involve the UWV or the cantonal court. However, please note that if you hired an employee after the retirement age, this option is no longer available.

Termination of Employment by Mutual Agreement

When an employee agrees to the termination of their employment, it is referred to as "termination by mutual agreement." In such cases, the employer does not require permission from the UWV or a court order for termination. Contrary to popular belief, employees who provide written consent for their own dismissal are entitled to receive severance pay. It is important to note that employees have the right to revoke their consent unilaterally within 14 days.

Settlement Agreement regarding Termination of Employment

When terminating an employment contract by mutual agreement, both the employer and employee can enter into a settlement agreement or termination agreement, which legally terminates the employment relationship. The entitlement to severance pay exists only if explicitly mentioned in the agreement. Additionally, other forms of compensation can be negotiated. It is important to note that employees have the right to unilaterally revoke the agreement within 14 days.

Legal Representation in Termination Matters in the Netherlands

If you have any questions or require assistance with employment termination, our team of experienced labor law attorneys is here to help. Contact our office to schedule a consultation with one of our dedicated lawyers, who will provide you with the expert guidance and support you need.

Our Areas of Expertise 

In addition to employment termination, our law firm specializes in various areas of employment law, including:

• Fixed-term employment contracts

• Non-competition agreements

• Transfer of undertaking

• Severance pay

• Illness and disability

Frequently Asked Questions

To provide further insight into the complexities of employment termination, we have compiled answers to some frequently asked questions:

How can I terminate an employee in the Netherlands?

Termination procedures vary depending on the circumstances. If you are considering terminating an employee, it is important to consult with a labor law attorney to ensure compliance with legal requirements.

Under what circumstances can employment be terminated for economic reasons?

Employment can be terminated for economic reasons when a company is experiencing financial difficulties that necessitate reducing its workforce. However, specific criteria must be met, and permission must be obtained from the UWV or the cantonal court, depending on the grounds for termination.

Under Dutch law, when is immediate dismissal possible, and how does it work?

Immediate dismissal, also known as dismissal with immediate effect, is possible in cases of severe misconduct or other serious breaches of the employment contract. However, the criteria for immediate dismissal are strict and must be substantiated. It is advisable to consult a labor law attorney to ensure compliance with legal requirements.

For further questions and detailed guidance tailored to your specific situation, we recommend reaching out to our employment law specialists for professional advice.

Disclaimer: This article is provided for informational purposes only and does not constitute legal advice. For specific guidance on your situation, I recommend consulting with a qualified professional.