Company takeover and employee rights
If you take over a business, you also take over the employees. You may not change any of their rights and obligations. The employees are entitled to the same salary, holiday days, and terms of employment as before. This also applies to sick employees. Read about the rules and the rights of your employees.
Prepare employees for company takeover
Do you take over a company? Then you must inform the employees in advance that there will be new coleagues. The previous owner must inform the employees well in advance about the sale of the company. You may need to involve the works council, trade unions or Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen, UWV) in the preparation. That depends on the size and circumstances of the takeover. Ask for advice about this well in advance from an organisation that specialises in takeovers and corporate mergers.
Taking over employees
You may not fire any employees when you take over a company. Your new employees retain all rights and obligations. This applies to both the primary and secondary terms of employment. You are not allowed to change anything in their employment contracts or in the existing collective labour agreement (CAO). This CAO continues to apply until it (or its declaration of universal applicability) expires. Only then are you allowed to change the terms of employment
The previous owner is jointly responsible for compliance with the employment contract for 1 year.
Exceptions when taking over employees
When taking over a company, you may decide whether and which employees you take over if:
- the company has gone bankrupt
- the activities of the company change radically
- it concerns a share transfer
There are no exceptions for sick employees
You must also take over sick employees. Including all obligations. That means you:
- takes over the risk of wage sanctions from the previous employer. With a wage sanction, you must continue to pay the wages for longer in the event of illness. UWV imposes a wage sanction if an employer fails to comply with its reintegration obligations.
- become a self-insurer for the Return to Work of Partially Disabled Persons Scheme (WGA) and the Sickness Benefits Act (ZW) if the previous employer was also one. This means that you must pay the benefits and the costs of the reintegration yourself.
Include the employees in your pension scheme.
You must take over the pension scheme from the previous employer, unless:
- your company has its own pension scheme. You can include new employees in this scheme.
- your company must participate in an industry-wide pension fund. Your new employees must also participate in this fund.
- there are agreements about the pension scheme in a collective labour agreement or another scheme.
Employees keep the entitlement to the pension that they have already accrued. Check if the former employer has paid the premiums for all accrued pension entitlements. If this is not the case, the pension provider may hold you liable for this.
Report the takeover to the Tax Administration
You must inform the Netherlands Tax Administration that you are taking over employees. To do so, complete the form Melding Loonheffingen Overdracht van activiteiten (Notification of Wage Taxes Transfer of Activities, in Dutch).
Will you become an employer for the first time as a result of the takeover? Then you must register as an employer with the Dutch Tax Administration.
Taking over personnel files
Did the previous owner keep personnel files? If so, you may take these over. However, you must consider the privacy of employees and comply with the European General Data Privacy Regulation (GDPR).