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Compensation failure to give notice (fixed-term contracts)

This information is provided by

Netherlands Enterprise Agency, RVO

For employees with a fixed-term contract of at least 6 months, a notice period applies. You must give temporary employees notice at least 1 month before their contract of employment ends. In doing so, your employees will know if their contract will be renewed or not and under what terms.

If you fail to give notice or you give notice too late, your employee is entitled to compensation. The amount of compensationExternal link (in Dutch) depends on both the type of contract and to what extent you have exceeded the notice period. Your employee may claim the compensation up to 2 months after their contract has ended.

Failure or too late: compensation

If you fail to give the proper notice at all, compensation amounts to 1 monthly gross salary. If you are too late, compensation will be proportional. If, for instance, your giving notice is 1 week too late, your employee is entitled to compensation of 1 gross weekly salary. Your employee's gross salary depends on their contract, and compensation must always be based on the most recent contract.

Gross monthly salary fixed-hours contract

If your employee has a fixed-hours contract, their gross monthly salary is calculated by multiplying their gross hourly rate by the number of hours worked each month. To this you add any extra wages, such as commissions or for piece work.

Gross monthly salary 'on call' contracts or 'min-max' contracts

To calculate the gross monthly salary of employees that have 'on call' or 'min-max' contracts, you must take their average working hours per month. You calculate this average on the basis of 12 months, or less if the duration of the contract was less. You add up all hours they have worked for you and then divide this total by the number of months, to calculate the average working hours. The gross monthly salary is calculated by multiplying their gross hourly rate by the number of hours worked each month. To this you add any extra wages, such as commissions or wages for piece work.

Please note: for a min-max contract the average amount of working hours is never less than the minimum amount of hours you and your employee agreed upon.

Employee's absence

If your employee was absent due to leave, strike or illness for one or more full months, you do not have to take this time into account when calculating their average gross monthly salary.

Gross monthly salary commission or piece work

To calculate the average gross monthly salary of employees that receive commissions or are paid for piece work, you add together all their earnings over a period of 12 months, or less if the duration of the contract was less, and divide it by the number of months. The result is the gross monthly salary. If your employer receives a monthly salary as well, you add these two figures together.

Employee's absence

If your employee was absent due to leave, strike or illness for one or more full months, you do not have to take this time into account when calculating their average gross monthly salary.

Exemption from paying compensation

You do not have to pay any compensation in case of:

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Questions relating to this article?

Please contact the Netherlands Enterprise Agency, RVO

This information is provided by

Netherlands Enterprise Agency, RVO