Overview
Employment law in the Netherlands provides strong protection for employees while offering employers a clear framework for managing their workforce. Whether you are an international company hiring your first Dutch employees, an employer navigating complex dismissal procedures, or an employee facing workplace issues, understanding Dutch labor law is crucial.
At Law & More, we represent both employers and employees in all aspects of Dutch employment law. Our employment lawyers combine deep legal expertise with practical business understanding, helping companies build compliant HR practices and assisting individuals in protecting their workplace rights.
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What We Do
Employment contracts and HR policies
Dismissal procedures and redundancy
Summary dismissal for cause
Collective labor agreements (CAO)
Non-compete and confidentiality clauses
Directors' liability and D&O insurance
Sick leave and re-integration management
Works council matters
International employment and secondment
Employment disputes and litigation
Settlement agreements (VSO) and severance payments
Employment dispute mediation
Expat contracts and work permits
Why Choose Law & More
Represent both employers and employees
Deep expertise in Dutch employment regulations
Practical, business-focused solutions
Experience with international employment structures
Multilingual service in English, Dutch, German, and more
Frequently Asked Questions
Common questions about employment law answered by our experts
Generally no. Dutch law provides strong protection - employers cannot dismiss solely due to illness during the first two years. After two years, dismissal may be possible with UWV permission if the employee cannot return to suitable work. Dismissal during sickness for reasons unrelated to illness (such as business economic reasons or serious misconduct) may be permitted.
Maximum two months for permanent contracts or fixed-term contracts over two years. One month for fixed-term contracts under two years. No probation allowed for contracts under six months. Must be agreed in writing before employment starts. During probation, both parties can terminate immediately without notice or severance.
Severance equals 1/3 monthly salary per year of service. Tax-free up to €90,050 (2026). Exceptions include summary dismissal for employee fault, termination during probation, and employee resignation.
Statutory minimum is one month (under 5 years service), two months (5-10 years), three months (10-15 years), and four months (15+ years). For employees always one month unless longer agreed (max six months). Notice must be mutual - employer's period cannot be shorter than employee's.
A fixed-term contract ends in principle automatically on the agreed end date, whereas a permanent contract continues until it is lawfully terminated. Under the chain rule, a series of fixed-term contracts can, after a certain time or number, convert into a permanent contract. The type of contract strongly determines the dismissal protection and the obligations of employer and employee.
During a probation period, employer and employee can terminate the employment contract with immediate effect without the usual dismissal rules. The maximum duration is set by law and depends on the contract length; for short contracts a probation period is not permitted. It must be agreed in writing and be equal for both parties, otherwise the clause is void.
Summary dismissal is only possible for an urgent cause, such as theft or refusal to work, and must be given without delay together with a statement of the reason. It is a far-reaching measure that the courts assess strictly. A wrongful summary dismissal can lead to reinstatement of the contract or substantial compensation. Both parties are well advised to seek timely advice.
The law has a closed system of grounds for dismissal, such as business-economic reasons, long-term incapacity for work, underperformance, culpable conduct, and a disrupted working relationship. The UWV is competent for business-economic dismissal and long-term illness; the subdistrict court for the other grounds. A combined (cumulation) ground also exists. The chosen ground must be properly substantiated.
In the event of illness, the employer must in principle continue to pay wages for up to two years, often at least 70% and at least the minimum wage in the first year. In return, both employer and employee have reintegration obligations. Insufficient reintegration efforts can lead to a wage sanction extending the payment period. A solid file is essential.
The transition payment is in principle due on termination of the employment contract at the employer's initiative and amounts to one-third of a month's salary per year of service, calculated pro rata. The right arises from the first working day. In certain situations, such as seriously culpable conduct by the employee, the right may lapse. We calculate the payment and advise on your position.
In addition to the transition payment, the court can award a fair compensation (billijke vergoeding) where the employer has acted in a seriously culpable manner, for example in the case of a wrongful summary dismissal or a deliberately disrupted relationship. The amount is not capped and is determined on the basis of the circumstances of the case. It has a strongly corrective character.
In a business-economic dismissal, the employer must substantiate the necessity, apply the correct order of dismissal (the reflection principle), and investigate redeployment. Permission from the UWV is usually required. Employees are entitled to the transition payment and sometimes to arrangements under a social plan. We check whether the procedure is correct and represent your interests.
A non-competition clause must be agreed in writing and, in fixed-term contracts, is only valid with a written statement of substantial business interests. The court can moderate or annul an overly broad clause if it unfairly disadvantages the employee. A non-solicitation clause is a specific variant aimed at clients and relations. We assess the validity and scope.
In an employment dispute it is wise to document communications and agreements carefully and, where possible, to reach a solution through dialogue or mediation. If that fails, a settlement agreement or proceedings before the subdistrict court may provide a way out. Always have a proposed settlement agreement reviewed, in particular with a view to your unemployment-benefit rights. We assist you at every stage.
When (part of) a business is sold or taken over, employees automatically transfer to the new employer keeping their existing terms of employment. Dismissal solely because of the transfer is not permitted. This protection also applies to certain outsourcing arrangements and mergers.
An employer can only change terms of employment unilaterally if there is a compelling interest, and stricter requirements apply where there is a written unilateral amendment clause. Without such grounds your consent is needed. It is wise not to agree straight away and to have the consequences assessed first.
During the first two years of illness a prohibition on giving notice generally applies, so the employer cannot terminate the contract. There are exceptions, for example on the closure of the business or summary dismissal. The prohibition protects the sick employee but does not release them from reintegration obligations.
The law requires the employer and employee to behave towards each other as a “good employer” and “good employee”. This open standard is given content by the courts and plays a role in disputes over, for example, a change of role, reintegration or taking leave.
With an on-call contract the employer must call the worker at least four days in advance, otherwise the worker need not come. After twelve months the employer must offer a fixed number of hours based on the average. These rules limit the uncertainty for on-call workers.
Key Legal Terms
Important terminology explained in plain language
Transition Payment (Transitievergoeding)
Statutory severance employers must pay when dismissing employees. Calculated as 1/3 monthly salary per year (first 10 years) + 1/2 monthly salary per year thereafter. Required after 24 months employment. Tax-free up to €90,050. Must be paid with final salary.
Chain Rule (Ketenregeling)
After three fixed-term contracts or 36 months employment (whichever first) within three years, the next contract automatically becomes permanent. Six month break resets the chain. Protects employees from indefinite temporary status.
Summary Dismissal (Ontslag op Staande Voet)
Immediate termination without notice or severance, only for very serious misconduct (theft, fraud, violence, gross negligence). Employer must act immediately and clearly state reasons. Threshold deliberately high to protect employees.
Collective Labor Agreement (CAO)
Agreement between employers/employer organizations and unions setting binding employment conditions for a sector or company. Covers wages, hours, vacation, pensions. When declared generally binding, applies to all companies in that sector. Approximately 80% of Dutch employees covered.
Balanced Labour Market Act (WAB)
Agreement between employers/employer organizations and unions setting binding employment conditions for a sector or company. Covers wages, hours, vacation, pensions. When declared generally binding, applies to all companies in that sector. Approximately 80% of Dutch employees covered.
Employment Contract (Arbeidsovereenkomst)
The agreement under which the employee undertakes to perform work for a certain period against pay, in the service of and under the authority of the employer.
Probation Period (Proeftijd)
The period at the start of employment during which both parties can terminate the contract with immediate effect. The maximum duration is set by law and it must be agreed in writing.
Reflection Principle (Afspiegelingsbeginsel)
The statutory method for determining which employees are eligible for dismissal in a business-economic dismissal, based on the age structure and length of service within interchangeable positions.
Fair Compensation (Billijke Vergoeding)
An additional compensation the court can award where the employer has acted in a seriously culpable manner around the end of the employment. The amount is not capped.
Continued Payment During Illness (Loondoorbetaling bij Ziekte)
The employer's obligation, in the event of an employee's illness, to continue paying (part of) the wages for in principle up to two years, coupled with reintegration obligations.
Reintegration (Re-integratie)
The combined efforts of employer and employee to help a sick employee return to work, within the company or elsewhere. Insufficient effort can lead to a wage sanction.
UWV (UWV)
The Employee Insurance Agency, which among other things grants permission for dismissal on business-economic grounds or for long-term incapacity, and provides benefits.
Notice Period (Opzegtermijn)
The period that must be observed when terminating an employment contract. Its length depends on the law, the collective labour agreement, and the contract.
Settlement Agreement (Vaststellingsovereenkomst)
A written agreement in which employer and employee record the terms for ending the employment by mutual consent, often relevant for preserving unemployment-benefit rights.
Non-Competition Clause (Concurrentiebeding)
A clause restricting an employee from competing with the employer after the end of the employment. It must be in writing and, in fixed-term contracts, requires a written statement of substantial business interests.
Transfer of Undertaking (Overgang van Onderneming)
The situation where a business or part of it is taken over, with employees transferring by operation of law while keeping their terms of employment. Dismissal solely because of the transfer is prohibited.
Prohibition on Notice (Opzegverbod)
A statutory ban on terminating an employment contract in certain situations, such as during the first two years of illness, pregnancy or works council membership, subject to some exceptions.
Unilateral Amendment Clause (Wijzigingsbeding)
A written clause reserving the employer the right to change terms of employment unilaterally. It may only be applied where there is a compelling interest outweighing that of the employee.
On-Call Agreement (Oproepovereenkomst)
A contract without a fixed number of hours, such as a zero-hours contract, under which the worker is called when there is work. The law sets requirements on call-up periods and an offer of fixed hours after a year.
Works Council (Ondernemingsraad)
The statutory employee participation body within larger organisations, with advisory and consent rights on important employer decisions, for example reorganisations or changes to employment-condition schemes.
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