Transcript Ius Laboris - Convegno AGI 2014

Dismissal process
Legal requirements in
The Netherlands
Avvocati Ius Lavoristi Italiani
Congresso Nationale, Genova, 19-20 September 2014
The employer who intends to terminate an employment
contract has four options:
1.Obtain prior permission to give notice from the Social Security
Institution (UWV);
2.Request the Court to rescind the employment contract;
3.Termination for urgent cause;
4.Reach mutual consent with the employee in the form of a
settlement agreement
Options 1, 2 and 3 will be explained in the next slides
2
Approval by UWV
Submit written application for a dismissal permit at the UWV -> must contain the dismissal
ground + supporting documentation
Possibility employee to submit statement of defens
Dismissal committee considers if there is a reasonable ground:
•
•
•
the employee’s incompetence or misconduct;
the economic reasons -> are the ‘principle of reflection’ and ‘seniority principle’ properly applied
Severe and prolonged disturbance of the labour relationship
Approval: notice of termination
Rejection: Remains employed
< 5 years
1 month
> 5 years - < 10 years
2 months
> 10 years - < 15 years
3 months
> 15 years
4 months
if the notice period is not respected the
employee can claim compensation
The is no appeal possible against the
decision of the UWV
End contract
The UWV is not in a position to impose
severance pay
Manifestly unreasonable dismissal;
employee can start legal proceedings
claiming that dismissal was ‘manifestly
unreasonable”. If so, the employer must
compensate the actual damage incurred by
the employee
3
Termination of the employment contract without prior
UWV consent is void, except:
•
Dismissal during a probationary period
•
Termination by mutual consent
•
Dismissal due to an urgent cause
•
Bankruptcy
•
Fixed term contracts expiring by operation of law
•
Resignation by the employee
•
Rescission by the Court
4
Ask permission Cantonal court
Court:
•
•
•
•
Employer: Request for rescission due to an “important reason”
Employee: File a statement of defens
Oral hearing
Decision
Request sustained: end contract
Request denied: no termination of contract
No possibility to appeal!
The amount of severance pay is calculated on the basis of a judicial formula:
A (weighed years of service) x B (gross payment per month x C (correction factor)
A is years of service until the
age of 35 count for 0.5;
between 35 and 45 for 1;
between 45 and 55 for 1.5
and as from 55 for 2.
B is the gross payment per
month, including other fixed
elements of remuneration,
such as holiday allowance,
13th month and average
bonus (if structural)
C is correction factor. If neither party
is to be blamed for termination it will
be set at 1.
If the employer is to blame it will be
adjusted upwards, while it will be
adjusted downwards when the
employee is to blame.
5
Termination due to an urgent cause
• No UWV permit is required
• Has immediate effect
• Without notice period
Requirements:
Urgent cause: serious misconduct
Means conduct or characteristics of the
empoyee which the employer cannot
reasonably be required to allow, such as
fraud, theft etc.
Communicated to employee as soon as possible (preferably writing) after having
given the employee the opportunity to defend/respond
End of contract
Court
Request sustained
Termination is void
6
Changes in dismissal law as of July 2015
• Under the proposed legalisation the employer can no longer freely
choose between submitting a termination request to the court or the
UWV. The ground for termination will be decisive in determining which
procedure must be followed.
• The new procedure allows parties to appeal UWV or court decisions to
a higher court
• Where an employment contract has lasted for at least two years, the
employer must pay a transition budget to the employee if the
employee’s termination is involuntary (regardless of the dismissal
route) or if a temporary contract is not extended
Transition budgets serve as a compensation for termination of an employment contract and as assistance to
transition an employee to alternative employment. The transition budget amounts the first ten years 1/3 of a
monthly salary for each year of service. After these ten years the transition budget amounts to ½ of a monthly
salary for each year of service. A transition budget cannot exceed € 75,000.
7
Employer’s decision to terminate
•
•
•
•
Economical
Technical
Organisational
Long term disability (> 2 years)
Reasons related to the ‘person’ of the
employee
Court
• Termination
• Compensation
• Reinstatement
• Nullification
UWV
Approval:
No approval:
Notice period
Remains employed
Termination
with/without additional
compensation
No termination:
remains employed
New: court
New: Court of appeal
8
Changes in dismissal law as of July 2015
If the employer and employee agree to terminate their employment
relationship by mutual consent, a mandatory two weeks reflection period
will apply, during which the employee can revoke his or her consent to
the termination of employment without reason.
Accepts:
End contract
Initiative
employer
Termination
agreement
Employee 14days
reconsider
Withdraws:
UWV/court
9
North America: Mexico - United States
Central & South America: Argentina - Brazil - Chile - Colombia - Panama - Peru
Western Europe: Austria - Belgium - Cyprus - Denmark - Finland - France - Germany - Greece - Ireland - Italy
Luxembourg - Netherlands - Norway - Portugal - Spain - Sweden - Switzerland - United Kingdom
Eastern Europe: Czech Republic - Estonia - Hungary - Latvia - Lithuania - Poland - Romania - Russia - Slovakia - Turkey - Ukraine
Middle East & Asia Pacific: China - India - Israel - Japan - Korea, Republic of - New Zealand - United Arab Emirates
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