Termination by the subdistrict court is the procedure in which the court dissolves an employment contract at the request of the employer or the employee. It is the route for dismissal on personal grounds, while redundancy and dismissal after long-term incapacity go through the UWV.
Table of contents
Legal basis
Article 7:671b of the Dutch Civil Code allows the employer to apply for termination on the grounds listed in Article 7:669(3). Those grounds are lettered: d underperformance, e culpable conduct, g a disrupted working relationship, h other circumstances and i the cumulation ground, under which several incomplete grounds may together suffice. Where the i-ground is applied, Article 7:671b(8) allows the court to award an additional payment of up to half the transition payment. Article 7:669(1) requires, besides a reasonable ground, that redeployment within a reasonable period is not possible. Article 7:671c gives the employee a right to apply for termination as well.
How it works in practice
Proceedings begin with an application and involve an oral hearing, usually within two to three months. The court examines the file: for underperformance it wants to see an improvement plan with concrete objectives, support and a realistic period. For a disrupted working relationship, the court asks whether the relationship is seriously and permanently disrupted, whether repair is still possible and whether redeployment was examined. If the employer mainly caused the disruption, the court will usually refuse to terminate, or award fair compensation if it does. Almost every case still ends in a settlement, because the outcome is uncertain for both sides.
Where it goes wrong
Employers lose above all on the file: an improvement plan that starts only once the decision to dismiss has been taken does not convince. A second error is invoking the g-ground where the employer mainly caused the disruption itself. The court will then usually reject the application. If it terminates the contract anyway and the employer acted seriously culpably, it can award the employee fair compensation under Article 7:671b of the Dutch Civil Code. Third, the redeployment obligation is underestimated, particularly within a group of several companies.
Related terms
Termination sits alongside the UWV dismissal procedure and the settlement agreement, and may result in fair compensation on top of the transition payment.
Facing termination proceedings? Our employment lawyers assess the file before the application is filed.
