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If you run a business in the Netherlands and would like to keep an employee who has reached the state pension age, you must take into account the contract of employment, working conditions and financial obligations.
Continuing the employment contract
Your employee will receive an old age pension (AOW) from the day they reach their AOW pension age. Their contract of employment can only be terminated upon reaching State Pension age. If the contract has expired, but you want to keep employing your employee, you can start a new contract of employment.
Dismissal at the age of 65 not allowed
If the collective labour agreement states that the employment contract will be terminated at the age of 65, this is in conflict with the Dutch Equal Treatment in Employment Age Discrimination Act (Wet gelijke behandeling op grond van leeftijd bij de arbeid, WGBLA). Termination of a contract of employment because of the employee's age can be nullified by a court of law at the employee's request.
Terminating the contract of employment
It is sometimes more favourable to terminate the existing contract of employment and conclude a new contract depending on your and your employee's situation. If you wish to terminate the contract, you will need the approval of the Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen, UWV) or the subdistrict court.
Terms of employment new employment contract
If the relevant collective labour agreement does not list terms of employment for State Pensioners, you must determine which terms you will be offering your employee in the new contract of employment. The terms of employment will depend on the type of contract where special attention must be paid to salary and leave.