The most important laws and regulations an employer has to comply with are:
The Social Affairs and Employment Inspectorate (in Dutch: Inspectie Sociale Zaken en Werkgelegenheid) supervises the compliance of employers with statutory laws and regulations concerning working conditions, working hours, labour relations and social security.
If the employee is not from the European Economic Area, the employer will usually have to apply for a work permit. If the employee does not have a citizen service number (in Dutch: burgerservicenummer), the employer must compel the employee to apply for one with the tax authorities. Furthermore, when parties enter into an employment agreement, they will have to agree, amongst other things, on which law is applicable to the employment agreement and which court is competent. The employer must also take into account that a foreign employee is entitled to the same terms of employment and working conditions as a Dutch employee.
An employer can terminate an employment contract amicably (thus without conducting formal legal proceedings) in two ways. Firstly, the parties can terminate the employment agreement by mutual consent and conclude a settlement agreement. Another possibility is that the employer terminates the employment agreement unilaterally, but the employee consents to the termination in writing. In both situations, the employee has a fourteen-day reflection period in which he can reneges his consent. In that case, the employment agreement continues as usual.
When the employee neither consents to the termination nor is willing to sign the settlement agreement, the employer may terminate the employment agreement unilaterally by obtaining a dismissal permit of UWV (UWV is an autonomous administrative authority and is commissioned by the Ministry of Social Affairs and Employment to implement employee insurances and provide labour market and data services) or by requesting the court to terminate the employment agreement.
If the employee has an employment agreement for an indefinite period of time, the employee may terminate the employment agreement without cause, taking into account the applicable notice period. A notice of termination takes effect at the end of a month, unless another termination date has been agreed in writing or has been ordered by common practice.If the employee has an employment agreement for a definite period of time, it must first be established whether the parties have agreed that termination before the end of the term is possible. If so, the employee can terminate the employment agreement contract prematurely with due observance of the notice period.
The statutory notice period for an employee is one month, unless parties have contractually agreed differently. A contractual notice period may, however, not exceed six months. A notice period longer than one month for the employee is only valid if the notice period for the employer is at least twice the duration of the employee’s notice period. The parties may agree that the employee shall not be bound by a notice period at all.During the probationary period, the employee may terminate the employment contract with immediate effect.
Trade unions and collective agreement matters are subject to the general provisions of labour law. These provisions are laid down in the Minimum Wage Act, the Working Hours Act, the Working Conditions Act, the Work and Care Act and in the Civil Code.
To establish a trade union in the Netherlands, only two employees and a notary are needed. The notary draws up the statutes for legal and any trade union that has legal personality can conclude collective (bargaining) agreements provided the trade union is authorised to do so under its articles.
Many companies are part of a collective bargaining agreement. In this written agreement, between one or more employers and one or more trade unions, labour conditions for all employees are set out, such as wages, payment for overtime, working hours, probation period, pension, holidays, and education. The provisions in a collective agreement are often more favourable for the employee than those prescribed by the Dutch Civil Code, but they may not contradict statutory law.
Many collective bargaining agreements stipulate that disputes relating to the interpretation of the collective bargaining agreement shall be submitted to a committee set up under the collective agreement.
The employee can first summon the employer to pay the wages immediately. If the employer fails to pay, the employee can bring a claim in preliminary relief proceedings. The hearing will usually be held within four to six weeks (or sooner in more urgent matters) and – except when the judge decides that an immediate judgment is required – the judge rules normally within two weeks after the hearing.
The grounds for dismissal are exhaustively mentioned in the Dutch Civil Code. The cause for termination also determines which authority assesses the termination.
The employee may bring legal proceedings to annul the dismissal. The employee can also opt to acquiesce in the termination of his employment agreement and start legal proceedings in order to be awarded the transition compensation and fair compensation or conclude a settlement agreement with the employer in which the parties mutually agree on the termination of the employment. After signing a settlement agreement, an employee is often entitled to receive unemployment benefits, provided the employee meets all the requirements set out in the Unemployment Act.An employee who has been dismissed pursuant to a dismissal permit from UWV may apply to the subdistrict court for reinstatement or compensation.
Unlike a limitation period, an expiry period cannot be interrupted.
If an employee does not reach a settlement with an employer, the employee can initiate legal proceedings before the subdistrict court. Depending on his claim, the lawyer will submit a writ of summons or an application to the court. The employer is given the opportunity to respond to the claim after which usually a court hearing is scheduled. During the court hearing, both parties may explain their arguments in detail and the judge may ask questions. After the hearing, the judge will normally deliver a judgment within a few weeks.
Yes, an employee may represent himself before the subdistrict court. However, if the employee appeals against a decision of the subdistrict court, the employee must be represented by a lawyer.
If the employer and the employee have agreed on a severance payment before the death of the employee, for example in a settlement agreement, the heirs of the deceased employee are, in principle, entitled to payment of that compensation.
If the judge has given a judgment terminating the employment agreement and the employee dies before the intended date of termination of the employment agreement, the awarded compensation is due to the employee’s heirs.
If the judge has not yet given a judgment and the employee dies before the judge delivers a judgment, the employment agreement ends by operation of law as a result of the employee’s death. The employer does not owe any compensation.
Yes, a party may appeal within three calendar months after the judgment.
Most disputes relating to employment law are dealt with by the regular court. However, it is possible to opt for arbitration in the collective bargaining agreement or in the employment agreement. The advantage is that the case will be heard behind closed doors. In addition, arbitration proceedings take often less time. The disadvantage is that arbitration is generally more expensive. Another possibility is to solve an employment conflict through mediation. Key differences are: mediation is cheaper than court proceedings, mediation is often a quicker procedure, there is more room for emotional feelings and recognition during mediation and the outcome of the mediation is generally accepted by both parties. The law also offers the possibility of establishing an independent committee that can issue dismissal permits instead of UWV. The advantage is that it is possible to deviate from the UWV guidelines for selection for redundancy and the reflection principle (the reflection principle requires that job losses must be proportionally distributed among the various age groups).