You can only dismiss your employee if you have good reason to do so. The law defines what grounds for dismissal are permitted. In some situations, you cannot dismiss your employee at all, and sometimes you need no grounds for dismissal. Your employee may resign without good reason.
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What grounds of dismissal are permitted?
You can dismiss your employee:
- for economic reasons, e.g. restructuring, company relocation or bankruptcy;
- if your employee is disabled for 2 or more years;
- if your employee is often sick and this has serious repercussions on your business and no other job or suitable work is feasible;
- if your employee’s performance is unsatisfactory; in this case you have to prove that you have warned your employee about this often and have given your employee sufficient opportunity to improve their performance;
- if your employee commits wilful misconduct or is culpably negligent, such as theft, coming to work drunk, forging diplomas or refusing to work without good reason; often, you can dismiss your employee summarily yourself on these grounds;
- if your employee has serious conscientious objections to the business activities and you are unable to offer alternative work;
- if the working relations are impaired (in Dutch) and cannot be restored;
- in other circumstances (in Dutch), for example, if your employee is in the Netherlands illegally or is imprisoned;
- in the event of non-performance of work by your employee, for a variety of reasons. Since 1 January 2020, there has been the option to dismiss your employee through the sub-district court on cumulative grounds (in Dutch). This means dismissal is also possible through a combination of the circumstances outlined above. Please note: economic reasons or long-term disability cannot be combined with other reasons.
Find more information (in Dutch) here about reasons for dissmissal.
Since 1 January 2020, dismissal on cumulative grounds via the sub-district court has resulted in extra severance pay
If the sub-district court terminates the employment contrac on cumulative grounds, it may award extra severance pay in addition to the transition payment. This extra severance pay cannot exceed 50% of the transition payment.
Before you can dismiss your employee, you must consider whether relocation is feasible.
When can you dismiss your employee without grounds?
- when your employee has reached the statutory or any other retirement age;
- when you dismiss your employee during a trial period; or
- when their temporary contract ends.
When are you not allowed to dismiss your employee?
There are a number of situations in which you cannot dismiss your employee, namely:
- during sickness or disability for work;
- if, during sick leave, you have done hardly anything to facilitate your employee’s return to work; you are therefore required to continue payment of salary for a longer period;
- during pregnancy, pregnancy and maternity leave and 6 weeks thereafter, or parental or care leave;
- during membership in a workers’ participation body;
- during candidature for a participation body;
- during membership of a preparatory committee for a works council;
- during compulsory military or alternative service in the country of origin;
- if your employee is a member of a trade union or due to attendance at meetings of representative bodies or the upper (not the lower) house of parliament);
- for reasons of discrimination on grounds of religion, race, age or disability;
- if your employee refuses to work on Sundays;
- if your company is taken over;
- because of the right to adoption leave and leave for taking a foster child;
- if your employee works for you as an expert under the Working Conditions Act (Arbeidsomstandighedenwet);
- if your employee is a data protection officer under the Dutch Data Protection Act (Wet bescherming persoonsgegevens).
What if your employee resigns?
An employee does not have to give a reason for resigning. If your employee resigns of their own volition, you do not have to pay a transition payment. However, if your employee leaves due to your own serious wilful misconduct or negligence, which has impaired the working relationship, then your employee is entitled to transition payment.