Increasingly expats seeking employment in The Netherlands are offered contracts previously offered to local staff only. If we are to point out the obvious, these local contracts do not have the same perks and incentives as the much seeked after expat contracts. Although employers have the right to initiate unilateral changes in a contract, quite often such changes are dismissed by the judge, if the case is brought to court. In The Netherlands, judges consistently deem employer’s interests to be as important as the employee’s interests.
However, a reorganisation of the company structure due to financial problems is a valid reason to unilaterally alter the terms of a contract. So under the current circumstances of a pandemic financial and economic crisis, it makes sense to have a close look at the situation.
The ‘golden handshake’ in 2009
The ultimate worse case scenario of such a unilateral change is a sudden termination of your contract due to economic circumstances. Redundancy packages, the ‘golden handshakes’ as it were, are calculated using a standard formula, the so called ‘Kantonrechtersformule’ (or sub disctrict courtformula). However, as of January 2009, this formula will change. And, I’m sorry to say, not in your favour.
This formula is:
A (number of the weighed years of service) x B (gross payment per month) x C = correction/adjustment factor (variable)
To keep it short – not sweet! – A change in the weighing of the years of service has a negative effect on the amount of the redundancy package.
But, will the culpability factor or correction/adjustment factor (C) turn out to be the magical loophole as far as internationals who plan to stay in the Netherlands are concerned? Previously, labour law used to only take into consideration the ‘guilt’ factor of either the employer or the employee. As of 2009, the current labour market position of the employee and other specific circumstances will also count. Therefore, it could well be that, should your contract suddenly be terminated, your labour market position would be evaluated as being weak and vulnerable, for example for not being a native Dutch speaker. If so, your compensation would be adjusted to the circumstances; what would normally be seen as a disadvantage in every-day-life might actually turn out to be a considerable enviable advantage! Well, only time will tell.
Things change when you have a Dutch contract for a definite period of time without the possibility of early termination. Dismissal before the agreed term means that the employer must pay the current salary throughout the remainder of the contract. In case of a contract for a definite period of time with the possibility of early termination no compensation is granted, if all applicable notice periods were observed during the redundancy procedure.
Luckily, things are not always as grim as they initially appear. This article will not and can not go into all the due details – however, only intending to scratch the tip of the iceberg, it is intended to point you into the right direction for sharp advice and efficient action.
GMW labour law specialists have set up a ‘crisis time’ clinic, offering insight and advice on any issues linked to employment and contracts. The first 30 minutes of the intake meeting are free of charge.
Godelijn Boonman – g.boonman@gmw.nl
Sabine Boellaard – s.boellaard@gmw.nl
070 3615048
