Changing employment conditions

When an employer and employee sign an employment contract, both are bound by this contract, including the terms and conditions of employment. So what happens when an employer wants to change the employment conditions that were agreed?

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When to call a lawyer about work

As an employee, you may be confronted with an unpleasant situation at work, such as a conflict, demotion or change in your employment conditions. In such circumstances, it can be difficult to know how to respond. Read more

The seven things you need to check in your new employment contract

You’ve just got a new job, or perhaps you’re extending an existing position. You’ve just received a new employment contract. Before you sign your employment contract, there are some key clauses to which you should pay attention.

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8 Ways to lose your job in Holland

As an expat, the most common reason to move to a new land is work – but which country will protect your rights in the workplace when you are there? Expat employment specialist Godelijn Boonman explains what makes the Netherlands a great choice for international workers.

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Things to consider when confronted with dismissal

Even though the Dutch economy is growing again, many companies are still dismissing employees. Godelijn Boonman highlights the top 8 things to consider when confronted with dismissal.

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The non-competition or business relations clause

Many employment agreements contain a non-competition clause or business relations clause. Employees would usually prefer to not agree to such a clause but they want the job and don’t want to annoy their new employer, so they sign.

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Can your employer enforce a salary cut?

Can your employer enforce a salary cut? The good news is that, as a matter of fact, an employer cannot easily enforce such a measure.

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Employment contract: non-competition clause

The non-competition, or non-compete clause is a clause that can be included in an employment contract between employer and employee. This clause states that the employee is forbidden, both during his period of employment and thereafter, to be employed by or associated with a company that performs work or provides similar services to the business of the employer, and that therefore could be in competition with the business of the employer.

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Employee rights: more clarity on fair compensation

Since July 1 2015, under certain circumstances, employees have been entitled to fair compensation. A judgment by the Supreme Court in 2017 provided more clarity on how this compensation is calculated. This blog explains the situation in more detail.


1. What is fair compensation?

Employees are entitled to transitional severance pay when their employer terminates their contract. When the employer behaves egregiously in ending the contract, the employee has the right to fair compensation in addition to transitional severance pay.

The law cites a number of situations where the right to fair compensation is given automatically. These situations include: wrongful dismissal, breach of contract terms, termination without the permission of the Employee Insurance Agency (UWV), breach of a ban on dismissal, breach of anti-discrimination legislation, and failing to adhere to the Collective Dismissal Act (WMCO).

2. What does the law say about the calculation method?

The law leaves the calculation of fair compensation entirely to the court’s discretion. The law does state that the level of compensation ‘should bear relation to the seriously egregious or negligent actions of the employer rather than the consequences of dismissal’. However, how this should be applied in practice is not made clear.

3. How do the lower courts determine the level of fair compensation?

The courts apply a number of different calculation methods. In a case before the district court in Eastern Brabant fair compensation was calculated by multiplying the transitional severance pay by two. The sub-district court in Rotterdam took the severity of the employer’s behaviour as its starting point and applied it to the particular circumstances of the case. The court also considered the anticipated loss of income and pension.
A court in Amsterdam chose a different route again by applying the sub-district court’s method. Some courts base their decision solely on the egregious behaviour while other courts focus on the negative impact. In short, the case law varies considerably.

4. What does the Supreme Court say?

The Supreme Court has issued the following guidelines for determining fair compensation:

● The court should decide fair compensation in a way that reflects the exceptional circumstances of the case.
● This may include having regard to the length of service, the reason that the employee is seeking fair compensation and their salary level.
● Insofar as the consequences are the result of serious egregious behaviour by the employer, the court may take the consequences of dismissal into account. In such cases it may consider lost earnings, opportunities in the labour market and future income.
● The extent to which the employer is at fault is relevant.
● Any transitional severance pay to which the employee is entitled should be taken into account.
● Fair compensation is not punitive in character. The main goal is not to punish the employer for his or her behavior. The imposition of a high financial penalty purely as a sanction is therefore not permitted.

5. Still no real certainty

The Supreme Court made clear that the consequences of dismissal may be taken into account in determining fair compensation. Where the employee is in a weak position in the labour market, compensation may be set at a higher level. On the other hand, it has been made clear that fair compensation is not punitive in character. The court will still have regard to all the circumstances and be required to justify the level of fair compensation it arrives at on that basis. In short: the Supreme Court has provided a little more substance in its judgment of June 2017, but there is still no certainty.

If you have any further questions relating to this topic, lawyers from the Legal Expat Desk will be happy to assist you. Please do not hesitate to contact us.


This blog was produced with the assistance of Jana Nowotny.

Updated November 2017. 

The Hague: international city of peace & justice

With the 100th anniversary of the Peace Palace the international allure of The Hague is very well visible. Besides the International Court of Justice and the Permanent Court of Arbitration, The Hague has another 200 international organisations, and 111 embassies and consulates. For centuries, The Hague has been the city of Peace and Justice with the international legal order taking a leading role. No wonder GMW lawyers often has to deal with international law.

International city of Peace & Justice

The various international institutions situated in The Hague include the OPCW (Organization for the Prohibition of Chemical Weapons), the ICC (International Criminal Court) and the ICTY (International Criminal Tribunal for the former Yugoslavia).

The Hague also has several academic institutions in the field of international relations, international law and international development, united in the so-called The Hague Academic Coalition. The Hague is, after New York, the most important city of the UN (United Nations). Also established in The Hague are Europol and the European Patent Office.

The Hague is a governmental city and the large presence of international institutions attracts new institutions with a diplomatic or intergovernmental status. There are more than 18.000 residents of the Hague working towards world peace. GMW lawyers supports these (international) employees and organisations and in this way contributes to the international and legal character of The Hague.

How did all these organizations end up here?

Ever since the establishment of the government of the Republic of the Seven United Netherlands in the 16th century, The Hague has offered accommodation to foreign diplomats. The international history makes The Hague very special.

Hugo Grotius (1583-1645) was a lawyer in The Hague who made the Netherlands a guiding country for international relations. In his most famous work “The Rights of War and Peace” (1625), he established legal limitations to the destruction of war. This document is still the basis of modern international law.

Tobias Asser (1838-1913), Dutch lawyer and later Nobel prize winner, set up the The Hague Conference of International Private Law. In line with this, the first edition of The Hague Peace Conference took place in 1899. This then led to the establishment of the Permanent Court of Arbitration. Subsequently, the Peace Palace was built to accommodate this new Court of Arbitration. With the establishment of the ICC (International Criminal Court) after the Second World War, The Hague became a magnet for other intergovernmental institutions.

Characteristics of international organisations

The establishment of international organisations is generally governed by the conventions in which these organisations are founded. This means that in principal these organisations only have to comply to the terms of their own treaty and to the general regulations of national and international law.

The independency of international organisations is revealed by their special privileges and immunities. Due to these special privileges, the host state does not have (full) legal authority over them. In a procedure, a judge in The Hague may declare himself unauthorised over an international organisation. Furthermore, buildings of international organisations are inviolable. This means that Dutch authorities may not enter these buildings without permission.

Mini states and their personnel

With the various international organisations, The Hague actually has a large collection of mini states. What does this mean for the people who work there? First of all, immunity also applies to the personnel of the mini states. There are some exceptions to this immunity, namely if a member of the personnel buys a house or gets married. In that case Dutch law applies.

This is quite different when it comes to Dutch employment law. International organisations have their own internal employment law rules. Only in exceptional situations a judge may be authorised to review a case relating to employment law, namely in the case of demonstrable violations of human rights. Either way, authorities may use diplomatic pressure to make sure that Dutch laws will be respected.



Please do not hesitate to contact us with any questions or for more information.


Dutch labour law and your contract of employment

Your employment contract may determine specific payment and work conditions, but Dutch law determines your rights as an employee in the Netherlands. There are a great many Dutch laws that apply, but some are especially relevant to international workers. Here are some expert tips on evaluating your employment contract under Dutch law.

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The do’s and don’ts of holidays

Are you trying to figure out how much time you can take off for Christmas? Or how to spend those final few vacation days you have left at the end of the year? Or, maybe you’re lucky, and you’ll have more holiday days then you need this year.

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Redeployment after a termination

In the Netherlands, employers must make an effort to reassign employees before they terminate them. But if you work for a large, multinational corporation, is your employer obligated to find a position for you anywhere in the world?


An employer must have reasonable grounds to dismiss an employee. Those grounds can including  reprehensible behaviour, poor performance or economic reasons. However, employers also have an obligation to redeploy staff prior to dismissing them. This means that the employer must make efforts to redeploy the employee within the company before proceeding to dismissal.

Legal obligation

The question then arises as to whether this obligation to redeploy is limited to the particular company where the employee is working or whether it applies to the entire corporate group to which the company belongs. Dutch case law is currently divided on this question.

Recently, a district court judge ruled on the obligation of redeployment. That ruling said that redeployment within an entire corporation is only obligatory when the group is defined as an economic entity with a central management presiding over the various subdivisions.

Other opinions

However, other district courts have reached different judgments. They have ruled that efforts must be made to redeploy within the group as a whole. An employer who declines to do this may be heavily penalised. A district judge in Rotterdam decided that €90,000 was just compensation for an employee when it was found that the employer had not even considered redeployment within the corporate family.

What to do?

Our advice to employers is therefore to consider redeployment very seriously and to show that they have looked at options across the corporate group. Otherwise the risk is too high that a district judge will penalise the dismissal by imposing a high level of just compensation.

If you are an employee who is facing a dismissal or if you are an employer who must dismiss an employee, you can contact our specialised lawyers to assist you.

Notice periods

 Any employment contract in the Netherlands must stipulate a notice period for ending the contract. That is the amount of time an employee must give an employer before leaving a position. Employees can be penalised for failing to adhere to the notice period requirements, so here’s what you need to know.

Dutch law governs some aspect of notice periods. However, with regards to some aspects of the law, your employer may be able to negotiate your notice period differently.

“Read your employment contract very carefully to see what it specifies about your notice period.”


Length of notice period

The length of the notice period depends on the type of contract you have and what has been agreed to in that contract. If you have a fixed term, or temporary, contract both the employer and employee cannot terminate the contract prior to the completion date of the contract. However, it is possible that the contract may give the employee the option to terminate the contract early. If so, your contract must also include this provision.

Indefinite contracts

In the case of an indefinite, or permanent, contract, the notice period is one month for the employee, unless the contract says differently. Typically, you cannot end your contract before the end of the month. This means that if you give notice to your employer on August 5th, the month of your notice period starts on September 1st. Thus, you must continue to meet the terms of your contract until September 30th.


Dutch employment law rules state that the contract may extend the employee’s notice period of one month. However, if your employer extends your notice period, their notice period must also be extended. The notice period of the employer must be at least two times longer than the notice period of the employee. So if the employee’s notice period is two months, the employer’s notice period must be at least four months. By law, the maximum length the maximum notice period that an employer can require of an employee is six months, as required by Dutch law, but a collective labour agreement can deviate from this.

Improper notice

If you, as an employee, leave your position before the notice period ends or if you do not give a proper notice period to your employer, your employer may be able to hold you liable for damages.

Unsure? Get advice you can trust

If you would like to have an expert take a look at your employment contract to see what specific notice period applies in your case or the damages you could face if you do not fulfil your obligations, please contact one of our specialised employment lawyers.

Employee or contractor? Recent changes in the Dutch business climate

For companies who are deciding to establish an office in the Netherlands, the legal form of the business is important. Equally important are the people who are going to work for the company: does the company want to hire employees or contractors? These two are very different. 


The three main features of an employment relationship are: that the work is performed personally; for which the employee is paid; and that a relationship of authority exists between employer and employee.

In the Netherlands, the law protects employees. An example of this protection is that an indefinite contract cannot be terminated without prior approval from the UWV (Employee Insurance Agency) or a sub-district court. Also, an employer is always obliged to withhold payroll taxes (loonheffing).


As a contractor (or ZZP’er in Dutch), one does not have to perform the work personally. Furthermore, there is no relationship of authority between the employer and the employee. In other words, a contractor works independently.

An agreement with a contractor can be terminated by giving notice. Generally no compensation is due and termination is possible at all times. Another difference is that the company does not have to withhold payroll taxes. Therefore, it is understandable that many companies hire contractors instead of employees. A contracting relationship can be more easily ended and offers more flexibility to the hiring company.

But how can one be sure that the contractor is indeed a truly independent business person? Until May 1 2016, contractors obtained a so called VAR from the Dutch Tax Authorities. If the contractor was in the possession of a VAR, the company could be sure that this person was truly independent and that they did not need to deduct wage taxes and make social security contributions.

Recent changes in the Netherlands

Since May 1 2017, the VAR no longer exists. A new legislation has been introduced, the DBA (Deregulering Beoordeling Arbeidsrelaties) law. The enforcement of this law has been postponed until July 1, 2018.

This law entails the re-assessment of work relationships. It concerns a system of general fixed contracting agreements in order to gain security over the character of the working relationship and check whether it really concerns an independent contractor relationship (and not an employment relationship).

However, another possibility is for the company to submit its own contract for approval by the Tax Authorities. If this contract is approved or if one uses the model contracts, a company can be sure that it will not be liable retroactively for the payment of payroll taxes. But don’t forget: even when using such a contract, a company must make sure that parties act according to an independent contractor relationship and not according to an employment relationship.

Changes for managing directors

The recent changes also apply in the case of managing (statutory) directors: employees but also directors of a company. Do note that the general meeting of shareholders has authority over the managing director, meaning that they mostly work as employees. The general meeting appoints and dismisses managing directors, taking into account the notice period. No prior approval of UWV or a court is necessary in this situation.


If you have any questions about hiring an employee or contractor or if you are a contractor with questions about the implications of new legislation about contracts, please contact one of our lawyers or submit your question online.


Update article: November 2017.

Terminating an employee

Do you have an employee you would like to dismiss? In the Netherlands, an employer cannot unilaterally end an employment agreement unless both parties have agreed upon a temporary contract which ends by operation of law.

Terminating an employment contract

If you have an employee on a permanent contract or you wish to end a temporary contract before it is scheduled to expire, you must either reach a settlement agreement with the employee or you must get permission to dismiss him or her. If grounds for dismissal are related to the employee, an employer will have to ask permission from the cantonal judge.

Poor performance

One of the most common grounds for dismissal is poor performance. And this is one of the most difficult reasons to prove. An employer must have a solid file to be able to convince a judge to dissolve an employment agreement.

This file should provide the following:

  • The employee is not suitable for the position. This can either be because the employee does not fulfill the position’s requirements or because the employee’s character does not match the requirements.
  • The unsuitability may not be the result of illness or disability.
  • The employee must be made aware of the employer’s point of view. The employer has to inform the employee in detail of the criticism.
  • The employee should then be given enough time to improve his or her performance. During that time the employer is obliged to discuss the employee’s improvements or lack thereof at regular intervals. Normally an improvement plan will take at the least 6 months and sometimes even up to a year.
  • The unsuitability may not be the consequence of too little schooling or training of the employee and may also not be caused by a lack of good working conditions.
  • The employee cannot be re-employed in another suitable position within the company.

A judge will only dissolve an unemployment agreement if all these conditions have been met.


If you or your company wishes to terminate an employee for any reason, please do not hesitate to contact us.

Update article: December 2017

Bonuses in severance pay

Are you an employee whose contract is being terminated and are you offered transitional severance pay? Then you might wonder how the amount of severance pay is calculated. An issue that has recently been brought into question is whether or not bonuses are included when calculating transitional severance pay.

Bonuses included in calculation?

Everybody used to think that bonuses are included in the calculation of transitional severance pay. However, recent ruling in both the district court and courts of appeal has not supported this point of view. So, how is the transitional severance pay calculated?

The amount of transitional severance pay is outlined in Dutch employment law. The Decree on Incomes outlines severance pay, as well as other employment issues, including notice periods. The Decree on Incomes, however, extrapolates further on issues including salary components and working time. It also provides a summary of all salary components.

Salary components

Per this ruling, salary components include:

  1. The basic monthly wage
  2. The holiday supplement
  3. Any agreed fixed salary components from the previous 12 months. These may include overtime or shift pay
  4. Any agreed variable salary components from the previous 36 months. These may include bonuses, distribution of profits or end-of-year payments

Bonuses fall into the fourth category, the “agreed variable salary components”. These are only counted as part of a severance allowance if they have been agreed upon. They must also be dependent on the employee’s performance, the company’s results or a combination of the two.

For example, this means that a discretionary bonus does not count for the purposes of transitional severance pay. If an employee is simply given a bonus every year, this bonus is not subject to an agreement. It is not dependent on the employee’s performance or the company’s results. The employer decides unilaterally whether to award the bonus and at what level.


If you have further questions regarding a severance package or any other employment issues, please contact one of our specialised lawyers.

Update article: December 2017

The proportionality principle in Dutch employment law

Dutch employment law strongly protects employees against dismissal. However, there are times when a termination is unavoidable. When a company reaches a point of economic deficiency where it is no longer possible to retain the same amount of employees, terminations will occur. There are a number of regulations covering the ways an employee can be terminated, one of which being the proportionality principle.

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Place of work determines applicable law

Which national law is applicable when it comes to international employment contracts? Is this the country of the employer, employee, or the country where the organisation is located?

The Rome Convention determines the law applicable to contractual obligations entered into between 1 September 1991 and 17 December 2009. Both this convention, as well as its modernized successor, the Rome I regulation, contain special rules for individual employment and employment contracts.

How is the country of law decided upon?

In first instance, as is laid out in the Rome Convention, the applicable law concerning employment contracts is the law chosen by the parties. However, the employee cannot be deprived of protection in the absence of a choice of law. In the case the parties did not make a choice of law, there are several elements which can determine the applicable law. The Rome Convention incorporates materially the same rule to sub paragraphs a) and b) but it does not prescribe an order between the two.

The contract shall be governed by the law of the country:

a) in which, or from which, the employee habitually carries out his/her work.
b) where the place of business through which the employee was engaged is situated.
c) when it appears from the circumstances that the contract is more closely connected to a country other than that indicated in paragraphs a or b, the law of that other country shall apply (rule of exception).

Modernization by the European Court of Justice
In 2013, in two cases concerning the transport and maritime sector, the court ruled that sub-paragraph b) only becomes relevant when it is not possible to determine the applicable law using the criterion of the place “where the employee habitually carries out his work”. This criterion must be interpreted broadly, which is especially relevant in relation to the transport and the maritime sector, as employees often work in many different countries in these sectors.

Indicators include the place where from the employee embarks the means of transport and whereto he returns afterwards, the place where he takes instructions, where he organizes his work and/or where tools are stored.

Only if these indicators do not allow the determination of the applicable law, does b) apply: the law of the place of business of the employer. Only procedural facts are to be taken into account when determining the place of business, not factors related to the work of the employee. Furthermore, the place of business must have a permanent character.

Killing two birds with one stone
With the ruling above, the court has given an important interpretation to the Rome Convention, as well as to Rome I. Firstly, the Rome Convention is now modernized, as a fixed order must be deemed to exist between sub-paragraph a) and b). Secondly, it seems reasonable that the indicators which are to be taken into account when applying sub-paragraph a) and b) are also applicable in relation to Rome I.

Furthermore, a third ruling is expected, as the Dutch Supreme Court has posed prejudicial questions concerning the rule of exception. Hopefully, this ruling will introduce even more clarity in relation to the Rome Convention and Rome I. To be continued.

Please, do not hesitate to contact us if you have any questions.

Update article: December 2017


Further increase of the state pension age in the Netherlands

The state pension age, the age at which someone is entitled to the old-age pension facilitated by the state when you meet the requirements, is currently (in 2016) 65 years and 6 months. This age increases yearly, based on the increased life expectancy.

In the current law, the increase of age is taken up per year, up to the year 2021. In that year, the state pension age will be 67 years. A possible increase for 2022 must be decided upon ultimately on January 1st 2017. And so the government did. The Ministry of Social Affairs confirmed at the end of October 2016 that in 2022 the pension age will be 67 and 3 months. Due to the greater longevity, further increases are to be expected over the coming years.

The choice of law in the employment agreement

When parties conclude an employment agreement, they can agree that this agreement shall be governed by a law chosen by them. Such choice of law applies when the employment agreement is international in nature. When all connecting factors point to one country, the obligatory provisions of that country are not set aside by the choice of law in the contract.

Explicit and implicit choice of law

Usually, a choice of law is explicitly taken up in a clause in the international employment agreement. Nevertheless, a tacit choice of law is also possible. This must be clearly demonstrated by the terms of the contract or the circumstances of the case. Examples of such indications are: a jurisdiction or forum clause, and references to a section of law of a country.

The impact of the choice of law

When the international employment agreement contains a valid choice of law, this does not mean this law actually governs the whole contract.

First of all, the application of overriding mandatory provisions of the law of a country cannot be restricted. Important sections of Dutch law which are considered overriding mandatory provisions are provisions regarding working conditions, working hours, and minimum wage. These provisions apply irrespective of a possible choice of law when the situation falls within the scope of Dutch law.

Second, a choice of law may not deprive the employee of the protection afforded to him by obligatory provisions under the law that would have been applicable to the contract without the choice of law. Most of Dutch labour law consists of obligatory provisions, and, most important, Dutch dismissal law is fully mandatory. This means that even when the law of another country is chosen by the parties in the employment agreement, it is possible that (parts of) Dutch law applies as well.

In conclusion

When no choice of law clause is taken up in the contract, this does not necessarily mean no choice of law has been made. Furthermore, when a choice of law is agreed upon, this does not always exclude the applicability of (parts of) the law of another country.

Not sure about which law applies to the employment agreement? Contact us for advice.

Immunity of international organisations in labour disputes

Various international organisations are based in the Netherlands. These organisations enjoy a degree of immunity in order that they may remain independent and function without impediments. This immunity is enshrined in the so-called headquarters agreement concluded between the relevant organisation and the Netherlands. It implies that in principle, no jurisdiction is conferred on the Dutch courts.

Overriding of immunity

The immunity of international organisations is not absolute, but rather functional by nature. This means that the immunity is not unlimited and applies only to disputes connected with the performance of its tasks by the organisation. Thus, an exception can be made regarding this immunity. The immunity may be set aside by the Dutch courts where the right to due process enshrined in Article 6 of the European Convention for the Protection of Human Rights and Fundamental Freedoms (ECHR) has been contravened. This can happen when the international organisation has offered no alternative judicial process for resolving disputes under private law. If allowed to proceed, the Dutch courts will deal with the substance of the dispute.

Immunity and labour disputes

Labour disputes involving employees of international organisations fall within the scope of functional immunity, if the duties that are executed are directly connected with the performance of the organisation’s tasks. In principle, this applies where the person in question has performed the duties for such an organisation.

The labour relations of employees working for an international organisation are generally governed by internal Staff Rules. Labour disputes are dealt with in accordance with these Rules. Therefore internal objection proceedings and/or an appeal procedure may be pursued in order to come to a decision on the dispute that has arisen. If this offers no remedy, the employee generally has recourse to an external body, usually the Administrative Tribunal of the International Labour Organisation, or, in the case of a European organisation, the Civil Service Tribunal of the European Union.

If the complainant happens to have recourse to the above judicial processes, this gives rise to an alternative legal procedure and the immunity will not be overridden. The Dutch courts in that case will have no jurisdiction to rule on the substance of the labour dispute. This was affirmed by the Supreme Court, for example in the case taken against the European Patent Organisation in 2009 (Supreme Court, 23-10-2009, ECLI:NL:HR:2009:BI9632) and more recently, on 20 March 2015, in the case taken against the Iran-United States Claims Tribunal (Supreme Court, 20-3-2015, ECLI:NL:HR:2015:687).

Only in very exceptional cases will the immunity of an international organisation be overridden in the case of a labour dispute. Such a situation did arise in the proceedings against the European Patent Organisation, presided over by the sub district court in The Hague (sub district court, The Hague, 19 August 2013, ECLI:NL:RBDHA:2013:10282). Having followed an internal procedure within this organisation, the employee instituted a procedure with the ILO Administrative Tribunal in accordance with the Staff Rules governing his employment. This Tribunal took 15 years (!) to decide the case. The sub district court ruled that this was not a reasonable period, and that the employee had been deprived of his right to due process by virtue of Article 6 of the ECHR. The immunity of the European Patent Organisation was deemed to be disproportional and cancelled, thus allowing for the dispute to be examined by the national courts.

Do you have a question about (international) labour disputes? Please contact us for advice.

Start-up permit as of 01-01-2015

As of 01-01-2015 it will be possible to apply for a residence permit to start-up a business which permit will be issued initially for one year.

Conditions to qualify for a start-up permit:
-the entrepreneur to be must have a facilitator with a reliable and experienced record
-the entrepreneur to be should run an innovative business and must have sufficient financial means
-the business should be registered at the Dutch Chamber of Commerce

Whether or not the business is innovative will be determined by the RVO (Rijksdienst voor Ondernemend Nederland), a subsidiary of the Ministry of Economic Affairs.

After this initial year conditions for renewal of the permit must be in line with criteria which are currently valid to qualify as an entrepreneur.

The former Dutch Euro Commissioner, Mrs Neelie Kroes, has been appointed to further strengthen the international position of the Netherlands as  “the ultimate country to start-up a business” to attract an increasing number of start-ups from other countries with the aim to rank innovative Dutch companies in an international top position.

It is not known as yet what other conditions will apply to further simplify immigration procedures but we will update you as soon as we know.

If in the meantime you have any questions then please get in contact with us.


A work permit is valid in all EU member states

Recently the European Court of Justice gave an important judgment regarding the assignment of non EU-workers within the EU.

Read more

Changes in Dutch employment law

Starting January 2015 a new Dutch employment law will be the source of many changes. This new law will have a large effect on employment contracts. 

Changes in employment law

  • Obligation of notification of termination. One month before the termination of a definite contract of 6 months or longer, an employer must notify the employee whether the employment agreement will be extended. If the employer does not notify the employee, he has the right to claim salary during the period in which the employer is too late. He can claim up to a maximum of one month’s salary. This obligation enters into force on January 1st 2015;
  •  Prohibition of a trial period in fixed term contracts of 6 months or less. This prohibition will be applicable to contracts that will commence after January 1st 2015;
  • Prohibition of a non-competition clause in fixed term contracts (unless the contract specifies the necessity of such a clause in light of severe company interests). Applicable to all contracts that are entered into after January 1st 2015;
  •  The current stipulation, “no labour, no salary”: an employee is not entitled to salary when not performing activities, will change. From now on it will be “no labour, still salary, unless the non-performance is seen as at the risk of the employee”. This change will secure a deviation of the burden of proof in favour of the employee. It is still possible to exclude applicability of this clause for the first 6 months of the contract. However, the exclusion can no longer be extended indefinitely by collective labour agreement.

The current regulation stipulates that an organisation can hire an employee on the basis of fixed term contracts three times and/or for a maximum period of 3 years. Also, the chain is cancelled when there is a minimum period of 3 months and one day between following contracts. As of July 2015 this will be changed. Now, an employment agreement for an indefinite period is established when:

  • a maximum of three contracts is exceeded;
  • the maximum time frame of 2 years is exceeded;
  • and in both of the abovementioned situations there is a period of no more than 6 months and 1 day in between two following contracts.

To sum up: the amount of temporary contracts remains the same. However, the period that those contracts comprise, cannot be more than 2 years. Furthermore, the employer will need a “time-out” of at least 6 months and 1 day to cancel the chain. For example, as of July 1st 2015 it is possible to get a fixed contract of 6 months wich is then extended with another 6 months, to end with a contract of 1 year. A chain of consecutive 1-year-contracts will however result in an agreement for an indefinite period after 2 contracts (i.e. after 2 years).

Termination of employment agreement 

There are various routes for termination of employment agreements, depending on the cause of termination. Termination based on extensive incapability ór economic reasons, must be executed through UWV. Termination based on “personal” reasons, like malfunctioning, disturbed relationship, must be addressed by the Cantonal Judge. Please note this change will leave the possibility of an amicable settlement unaffected.

Also, as of 2015, the employer does not need consent of UWV or the Cantonal Judge in order to terminate the employment agreement once the employee has reached the AOW eligible age.

Irrespective of the termination-route (UWV of Cantonal Judge) the employer will have to pay a “transition compensation” (transitievergoeding). This compensation replaces the severance payment (ontslagvergoeding) and is calculated differently.

The transition compensation is calculated as follows: for every year of service less than 10 years, the employee receives 1/3 of his monthly salary. For every year of service that exceeds 10 years, half of his monthly salary is granted. In 2017, in total a maximum of € 77.000,- applies, unless the employee’s yearly salary exceeds that amount (in which case this higher amount counts as maximum).

The transition compensation is not due in case of severe fault of the employee, for example in case of termination due to an urgent cause. Temporary employees are also eligible for the transition compensation, as soon as the temporary employment relation reaches a period of two years (without renewal/extension of the contract).

  • In case of severe culpability of the employer, a Judge may grant the employee an additional “reasonable” compensation;
  • Given the above, the sub-district Judge formula no longer apply in procedures that are entered into after July 1st 2015. In negotiations on amicable terminations, the transition and possible additional compensation will be leading;
  •  The procedure of “manifestly unreasonable dismissal” no longer exists;
  • In case of amicable termination (mutual consent, settlement agreement), a reconsideration period of 14 days will be introduced on behalf of the employee. Within those 14 days, the employee may withdraw his consent, which leads to continuation of the employment agreement or reopens negotiations. The employer is obliged to inform the employee about that possibility;
  • Obligation to provide education. This stipulation will especially be of importance in cases concerning malfunctioning. The present practice already requires the employer to provide a malfunctioning employee with sufficient tools to improve, but our expectation is that the legal stipulation will be applied more strictly in those circumstances;
  • All termination decisions (Cantonal Judge, as well as UWV) can be appealed in front of the Court of Appeal and the Supreme Court.
  • The Extraordinary Labour Relations Decree 1945 (BBA 1945), is extinguished.

Observation of new regulations

Finally, we would like to make some observations regarding these new and expected changes. Employees can ask for golden parachutes when they negotiate their employment terms. Especially employees who have high salaries and who do not want to be “punished” by only being paid the transition compensation, will want to agree upon a severance upfront.

We expect further complications with regard to the fact that there will be only one route which an employer must take when wanting to terminate an employment agreement. As most cases are not clear cut in the sense that they are either requested because of economic reasons or extensive incapability (which would mean the UWV-route) or personal reasons (meaning the route of the cantonal judge).

Employers will want to prevent having to go to court. Employees can use this to negotiate a higher compensation. We expect that most employers will not want to deviate from the transition compensation calculation, especially because a judge will only grant an additional compensation in case of severe culpability of the employer.

Of course we will keep you informed of developments, such as on transitional law and the relationship between the changes and ongoing collective agreements.



If you have any questions or would like more information, please do not hesitate to contact us.

This article was updated November 2017. 


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