Dismissal Law PDF Print E-mail
Dismissal law is characterized by a maze of regulations where it is very easy to lose track of things. It is all the more easy then, to have an experienced guide by your side to steer you through all the regulatory measures. The most important elements of dismissal law are set out in a nutshell below:

1.Instant dismissal
In the event that an employee crosses the line an employer may dismiss him instantly. However, an employee may also resign instantly.

Both the employer and the employee may invoke instant dismissal/resignation. This type of dismissal is subject to so-called ‘urgent cause’ so the employer, or the employee for that matter, cannot reasonably be required to continue the contract of employment.

Examples of urgent cause for the employer to instantly dismiss his employee are theft and embezzlement, persistent refusal from the part of the employee to carry out reasonable orders and assignments issued to him by or on behalf of the employer, gross disregard on the part of the employee for the duties as laid down in the employment contract,  when the employee, despite warnings, succumbs to intoxication or other dissolute behaviour and when the employee appears to seriously lack the skill or suitability to carry out the work. Examples of urgent cause for the employee to instantly resign are when the employer abuses, rudely insults or seriously threatens the employee, his family members or members of his household, when the employer tries to tempt the employee, his family members or members of his household to commit acts that are in violation of the law or that are contrary to public morality, when the employer fails to pay the wages in time or when the employer grossly disregards the obligations as laid down in the employment contract.

Besides this, instant dismissal must become effective without delay. This means that the decisive moment is the moment when the urgent cause for dismissal has become known to the party authorized to grant dismissal or to resign. Once it has been determined at what moment the party (employer or employee) authorized to grant instant dismissal has become aware of the act, characteristic or behaviour of the employee in question, instant dismissal must be granted, or else instant resignation must be effected without delay. The main rule is that no delay will be tolerated here. Yet still, the employer may be granted some time to hear the employee, to hold internal consultations and to seek (legal) advice before proceeding to instant dismissal, but then the employer must proceed expeditiously.

In case an employer instantly dismisses an employee, or else in case an employee instantly resigns, the other party must be notified of the reason for the instant dismissal/resignation at the same time this instant dismissal/resignation becomes effective.
The employer or employee who gives notice without there being urgent cause or without simultaneous notification of the urgent cause will be liable to pay compensation. Also, the party who has provided urgent cause with intent or negligence to the other party in order to give notice to terminate the employment contract without delay, will be liable to pay compensation. It is therefore important to seek expert and specialized legal assistance in time.

2.Continued payment of wages
Often an employee who has been instantly dismissed will contest his dismissal, because on the one hand he no longer receives any wages and on the other hand he also does not qualify for benefits based on the Unemployment Insurance Act as he has become voluntarily unemployed. The employee will therefore invoke nullity of the instant dismissal, because the employer has not based the dismissal on urgent cause, or because the employer has not notified the employee of the reason for the instant dismissal at the same time. The employee will therefore claim that since this is not a legally valid dismissal and as such the employment contract is still in force, he is entitled to continued payment of his wages. For that purpose, the employer will then remain available for work.

Such proceedings require know-how and a swift, pro-active approach from the legal assistance provider, not in the least in order to put pressure on the employer at as early a stage as possible, to prevent legal action. After all, instant dismissal has serious financial consequences for the employee.

3.Manifestly unfair dismissal
In case an employee has been instantly dismissed and he sees no reason to continue the employment agreement and he does not invoke the voidability of the instant dismissal, he may claim for damages based on irregular and/or manifestly unfair dismissal.

Furthermore, manifestly unfair dismissal may be invoked in the event that there is a dismissal permit from the Centre for Work and Income (CWI). This will be explained hereinafter.

An employer may have different reasons to apply for a dismissal permit at the CWI. In the CWI procedure the employee will have the opportunity to set up a defence. Based on the motivated application from the employer and the defence from the employee the CWI may resolve to either or not grant the dismissal permit. In case the dismissal permit is granted, the employer will terminate the employment contract with due observance of the term of notice. The employer may deduct one month from the term of notice, provided he observes a term of notice of no less than one month.

There is no appeal possible against a resolution by the CWI to grant a dismissal permit. However, the employee may consider to start manifestly unfair dismissal proceedings with the subdistrict court and claim for damages. The employee will then need to make a plausible case that the consequences of the dismissal, considering the arrangements made for him and the existing possibilities to find fitting employment, are too serious compared to the interest of the employer regarding the termination of the employment contract. This is also called ‘the consequences criterion’.

An experienced and knowledgeable legal assistance provider may come up with a solution here also.

4.Request to terminate the employment contract
Another way to end the employment agreement is by termination. Both the employer and the employee are at all times authorized to request the subdistrict court to terminate the employment agreement based on serious reasons. ‘Serious reasons’ are the ‘urgent causes’ as referred to earlier and also ‘changes in circumstances’. Changes in circumstances are understood to be, among other things: commercial grounds such as reorganizations, poor performance from the employee (provided that the employer has provided sufficient opportunity to the employee to improve his performance) and also a damaged working relationship such as a lack of trust in the other party.

In the event that the subdistrict court grants the request based on changes in circumstances, it may award one of the parties compensation at the expense of the other party. In principle, this so-called ‘dismissal compensation’ is set in accordance with the so-called nationally known ‘subdistrict court formula’.

Subdistrict court formula
The subdistrict court formula is the basis on which subdistrict courts, in case of termination of an employment agreement, determine as to whether severance pay will be awarded or not. The subdistrict court formula also determines the amount of the severance pay. As the subdistrict court formula is a recommendation, it is not binding. Nonetheless, this formula, as a yardstick, is widely used to determine the height of the severance pay.

There are three components that determine the outcome of the subdistrict court formula. They are:

A.the number of years of service taken into account (which is expressed in the factor ‘A’);
B.the payment per month (which is expressed in the factor ‘B’), and;
C.the so-called adjustment factor that determines to whom the termination of the employment agreement must be attributed (which is expressed in factor ‘C’).

These components provide the outcome of the subdistrict court formula, and this formula looks like this: A * B * C equals the height of the severance pay.

A new subdistrict court formula has come into force as per January 2009. The A * B * C principle still applies but more value is attached to the employment status of the employee, the training programm provided by the employer and the financial situation of the employer.

Lawyer specializing in dismissal law
Specialized and expert legal assistance prevent you from assuming the wrong point of view regarding the explanation and application of the subdistrict court formula. Expertise and specialized knowledge go hand in hand and together they determine the outcome of your legal action. Since these characteristics are united in our company philosophy, you have come to the right place to entrust your interests with.

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