5 tips about Dutch employment contracts
Category: Employment law
These tips are for companies doing business in the Netherlands, expats and foreigners working in the Netherlands. Even if foreign law applies to a contract Dutch law may (partly) apply to the employment situation. Or a Collective Labour Agreement (CAO) may apply. Also good to know: Dutch Employees are pretty well protected under Dutch law. Please contact one of our employment lawyers if you have any questions on Dutch Employment.
Tips on Business and Employment in the Netherlands
Dutch Employees are pretty well protected by Dutch law. And so are expats working in the Netherlands. These tips are for companies doing business in the Netherlands, expats and foreigners working in the Netherlands.
Tip 1 Dutch law applies to employment contracts in the Netherlands
Working in the Netherlands means Dutch law could also apply in case of an employment contract under foreign law. Dutch law may have advantages for an employment situation. It is possible that a Collective Labour Agreement (CLA) applies in the branche or industry sector an employee works in. A CLA is an arrangement which could cover the terms and conditions of a Dutch employment. This CAO will then apply to the employment situation. If it concerns a minimum CAO, the Employer may deviate from this if this is advantageous to the employees.
Tip 2 Employment contract may become an indefinite term contract
In the Netherlands you can have an employment contract for a definite (fixed term) or an indefinite period of time. A fixed term employment agreement will end by operation of law after the agreed period has expired unless the contract is prolonged. Series of three (3) consecutive fixed-term employment contracts, which follow each other seamlessly or with an interruption of not more than six months can be agreed upon for a maximum of 24 months. If a contract has been prolonged three times the employment agreement will automatically convert into an indefinite contract. That is also the case if the employee has worked on consecutive temporary contracts in the Netherlands for more than two years. Please note that for directors under the articles of association parties can deviate from this rule.
Tip 3 Dismissal in the Netherlands is regulated
Termination of an employment agreement is possible for several reasons. According to Dutch employment law there should be a reasonable ground for termination as exhaustive listed in the Dutch Civil Code. The reasons for termination can be distinguished into two groups: (1) business economic dismissal and long term illness (more than 2 years) and (2) personal reasons such as inadequate performance. Termination by the employer is only valid if: 1) there is a reasonable ground for dismissal; and 2) there is no suitable other position available within the company within a reasonable term. For a valid dismissal the employer can give notice after having obtained a permit from the UWV (governmental instance) or can request the Court to dissolve the employment agreement. However, in the vast majority of the cases, employers first try to solve the dismissal amicably by mutual consent by means of a settlement agreement.
Tip 4 Job (change) in the Netherlands
If the EU citizen is going to work for a company that is officially recognised as a sponsor by the IND, he or she should register at IN Amsterdam (formerly ‘Expatcenter Amsterdam’). IN Amsterdam serves companies and highly skilled migrant employees in the Netherlands, scientific researchers, international entrepreneurs and international graduates. Only an employer can apply for a work permit (TWV). A change in the work of the employee in the Netherlands or partnership status must be reported to the IND within four weeks. As an employee, you cannot do this yourself.
Tip 5 Equal treatment and pay in the Netherlands
An employer in the Netherlands has to treat and pay employees equally. Working conditions must be the same for all employees of a company doing business in the Netherlands. Discrimination based on religion, beliefs, political opinions, race, gender, age, disabilities or any other grounds is unlawful.
Please don’t hesitate to ask me any questions on employment issues in the Netherlands.