NETHERLANDS Law and Practice Contributed by: Friederike Henke, Ingrid Cools, Philip ter Burg, IJsbrand Uljée, Suzan van de Kam and Epke Spijkerman, BUREN
their shares. However, Dutch case law has recognised that there may be exceptional circumstances that allow the “corporate veil” to be lifted and sharehold - ers to be held jointly liable for the company’s debts and obligations. Partners in VOFs are jointly and severally liable for all obligations of the partnership. The liability of general partners in a CV is unlimited, while the liability of lim - ited partners is limited to the amount of their capital contributions, provided they have not performed any acts of management or representation of the partner - ship. The legal framework governing employment contracts is set out in the Dutch Civil Code (DCC). Additional terms and conditions may be agreed in an individual employment contract, provided they do not contradict the mandatory statutory provisions of the DCC. Fur - thermore, the legal relationship between an employer and employee may be governed by collective labour agreements between the trade unions and employers (or organisations of employers). Multiple other laws and regulations are also of influence – eg, the Equal Treatment Act. In addition, case law, especially rulings of the High Court, provides an important series of precedents and principles, which often help to clarify ambiguous statutory or contractual provisions. The laws of the European Community and other international treaties and regulations form another important source of law. 4.2 Characteristics of Employment Contracts Dutch employment law does not require employment contracts to be made in writing. Certain provisions, however, need to be in writing to be valid, such as non-competition clauses or probation period clauses. Therefore, in practice employment agreements are concluded in writing. 4. Employment Law 4.1 Nature of Applicable Regulations No legal provision dictates the language in which employment contracts should be concluded; they do not necessarily have to be in Dutch, with international
companies commonly offering employees employ - ment contracts in English. Most important is that the employee understands the content of the document. Employment contracts can be concluded for a defi - nite period of time (fixed-term contracts) or an indefi - nite period of time (indefinite contracts). Consecutive fixed-term employment contracts, if extended, are automatically converted into indefinite contracts, once certain criteria are met. This applies if the number of consecutive contracts exceeds three, or if the aggre - gate term of the consecutive contracts exceeds 36 months. 4.3 Working Time Under the Dutch Working Hours Act, employees are generally allowed to work a maximum of 12 hours per day and a maximum of 60 hours per week. Over a period of 16 consecutive weeks, employees may not work more than 48 hours per week on average. Over a period of four consecutive weeks, the weekly average may not be more than 55 hours. Collective labour agreements or employee handbooks may contain provisions on the standard working hours in a company. 4.4 Termination of Employment Contracts The dismissal of employees is governed by manda - tory statutory dismissal provisions. The system differs substantially from most other EU countries. Fixed-term contracts end by operation of law on the agreed end date. Employers may terminate indefinite contracts by giv - ing notice of termination. The most striking difference to other jurisdictions is that employers must, in prin - ciple, first apply for a dismissal permit from the gov - ernmental agency called UWV Werkbedrijf before they can give such notice, or they must request the court to terminate the contract. The manner of termination for employers is prescribed by law, depending on the reason for termination: termination for economic rea - sons or due to long-term incapacity for work must be effected through the UWV procedure, while dismissal on other grounds has to take place through termina - tion by the court.
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