In a time when we accept VOIP calls, sound bites and instant messaging as standard work tools, it can be tempting to believe that a verbal discussion is sufficient – but this is not always true. In the case of ending a fixed term employment contract, written notice remains essential.
This post was reviewed and updated on 17 July 2020
When an employment contract ends
As the end of an existing fixed-term employment contract approaches, employers have an obligation to notify their employee about how they wish to proceed. Whether the employer wishes to renew the contract or if they wish to end the working relationship, they must inform the employee of their intentions.
This notice must be given more than a (calendar) month before the end of the existing contract, and – critically – that notice must be given in writing.
Always put it in writing
Under Dutch law, not only does an employer have an obligation to notify, it is also mandatory that they serve that notice in writing, whether this is done as hard copy (paper) or via a digital format such as email. In the event of a disagreement, the written notice can provide evidence of what was communicated and when.
If the requirement to give formal written notice is not fulfilled, or is not done correctly, then the employer may find that they are liable to pay the outgoing employee compensation.
Temporary or fixed term contract? The law still applies
A fixed-term employment contract ends by operation of law by the end of the term. As such, employers do not have to take action to end the employment (unless otherwise stipulated in the employment contract).
Nonetheless, they still have the same duty to inform the employee that the employment will end by giving them written notice at least a month before the contract expires.
What happens when you get it wrong
The following two cases give examples of the consequences of not adhering to the legal requirements for giving an employee notice in writing.
In the first case, more than a month before the expiration date, an employer informed his employee verbally that they wished to extend the fixed term contract. The employee accepted this extension – but then subsequently changed their mind and gave notice to terminate the contract, informing the employer verbally of that decision. When the case went before the Court of Appeal in The Hague, the court could not determine if notice had been given on time, as it was not done in writing. Because the employer had not given written notice that they did not wish to extend the original contract, the court ruled that the employee was entitled to be paid compensation.
In a second case, an employer notified his employee verbally that the existing employment contract would not be extended, but that the employee could continue to work for the organisation via a payroll system. When this case went to court, the court found that while the employee was aware that “something” had changed his employment contract, the verbal notification did not make clear when the existing employment contract would end. As a result of the notice not being given in writing, and the resulting confusion, the employee in this case was also entitled to compensation.
Employers, here’s how to get it right
Do it on time, and do it in writing.
At least one (calendar) month before the employment contract expires, give your employee written notice of whether or not you wish to extend or terminate the contract with them. If you do wish to extend, write down the conditions under which this will take place.
If you are late in giving your employee notice, inform the employee in writing anyway and keep the original end date of the employment contract. You will then owe the employee a fee – but only for the number of days that you are late in giving notice.
If you are unsure if you have fulfilled your duty to notify as an employer, get legal advice as soon as possible.
Questions? More information?
If you would like to know more about your legal obligation to notify your employees, or if you’d like to discuss one of the topics raised here, please contact us.
This article was originally published on DutchNews
Godelijn experienced an international upbringing and education as an expat child living in Africa and England. Back in The Netherlands, she studied law at the University of Utrecht (1990). She then embarked on her legal career as a lawyer by working 10 years for the well-known law firm of ‘Wladimiroff en Spong Advocaten’. In 2000 she joined GMW lawyers as a partner and is the head of the Labour law and Pension section.
Godelijn specialises in international employment law and has extensive experience in dealing with both non-contentious and contentious international employment matters including (collective) redundancy packages and dismissal. She works for both companies and individual employees, enabling her to keep an open mind to both sides of a case. Naturally she helps her clients when a problem has arisen, but prefers to act before an escalation has taken place. Advice on a fair Human Resource policy is an essential part of her work.
Godelijn Boonman is considered to be the undoubted employment specialist for the expat community because she is bilingual, has a large international clientele and a wealth of experience in international employment law matters. She is therefore frequently asked to be the key note speaker at international seminars.
Godelijn has a keen interest in the international community and is a member of the advisory board of ACCESS .