NETHERLANDS LAW AND PRACTICE Contributed by: Friederike Henke, Ingrid Cools, Philip ter Burg, IJsbrand Uljée, Suzan van de Kam and Epke Spijkerman, BUREN
tionary period during which each party may ter - minate the employment contract with immediate effect, without the prior permission of the UWV or the court. Employment contracts may be terminated with immediate effect and without prior permis - sion from the UWV or the court if there is an “urgent cause” to do so. The DCC provides a non-exhaustive list of acts that may qualify as an ”urgent cause”, such as fraud and theft. Employers are required to make a “transition payment” to employees if one of the following applies: • the employment contract is terminated by the employer by giving prior notice of termination; • the court terminates the employment contract at the employer’s request; or • the employer decides not to renew the employment contract after the expiration of the agreed fixed term. Transition payments are equal to one third of a monthly gross salary for every full year of employ - ment, regardless of the employee’s age or years of service and calculated pro rata, depending on the exact duration of employment. The pay - ment never exceeds EUR98,000 (as of 2025), or one annual salary for employees earning more than EUR98,000. Only employees who are seri - ously culpable for termination are not entitled to a transition payment. If the court rules that an employer has demonstrated serious culpable behaviour towards an employee the court can grant the employee additional severance. Employers who intend to dismiss at least 20 employees within a period of three months (in one region) are subject to the Collective Redun - dancy (Notification) Act. Under that legislation,
employers must notify the UWV and the relevant trade unions of the intended dismissals, and must first discuss the proposed decision and its social consequences with these trade unions. 4.5 Employee Representations Under the Dutch Works Council Act (WCA), companies employing at least 50 persons must establish a works council for the purpose of con - sultation with and representation of the employ - ees. The employees elect the members of the works council directly from amongst themselves. The number of members depends on the num - ber of employees within the company, and varies from a minimum of three to a maximum of 25. The WCA provides a number of rights for the works council, including the right to advise on certain matters and the right of approval. Com - panies must request the prior advice of the works council on certain decisions (and their imple - mentation) about significant business matters, such as the transfer of control over the company or any part thereof, the establishment, takeover or disposal of control over another company, or the termination of operations or a substan - tial part thereof. In addition, companies must request the prior approval of the works council in respect of certain decisions concerning the introduction, modification or repeal of “social” regulations within the enterprise, such as regu - lations on: • pension schemes;
• profit-sharing or saving plans; • working hours or leave; and • salary or job classification systems.
Furthermore, trade unions often represent their members in discussions about a collective labour agreement and in collective dismissals.
539 CHAMBERS.COM
Powered by FlippingBook