News - Changes to the Work and Security Act as of July 1, 2015

Changes to the Work and Security Act as of July 1, 2015

In the coming years, there will be a lot of changes in labour law. The Work and Security Act is designed to make dismissal faster and cheaper, to strengthen the legal position of flexible workers, and to get more unemployed people to work. We list the main changes and the date on which they will take effect.

01/07/2015: Dismissals and redundancies

Whatever the reason for the dismissal, you could choose between two "redundancy routes": through UWV (the Netherlands Employees Insurance Agency) or through the courts. Appeals and cassation against a court ruling was not possible. This will change on July 1, 2015.The UWV route applies to dismissals for economic reasons or dismissal after two years of illness. You will need to submit all other reasons for dismissal to the district court. The decision of the UWV can also be submitted to the district court. The decisions of the district court can be appealed and brought before the Supreme Court.

1-7-2015: Transition Compensation

The current severance pay scheme will expire. It will be replaced by the transition compensation. An employee with an employment contract of at least two years is entitled to this compensation for the dismissal or non-renewal of the employment contract. The goal of this transition compensation is on the one hand a compensation for dismissal, and on the other hand aims to promote the transition from work to work. The compensation amounts to 1/3rd of the monthly salary for the first ten years of employment, and a half month's salary for the remaining years up to a maximum of € 75,000 gross (or a higher annual salary).Note that this compensation is also payable if an employee leaves the employment after two years of illness.

01/07/2015: Chain rule

The idea is that employees are offered a permanent contract faster. Currently, a permanent contract is created when a fourth contract is started after multiple temporary contracts succeed each other within three months, or after 3 years. The new chain rule applies to contracts entered into or renewed on or after July 1, 2015.There still is a maximum of 3 fixed-term contracts, but the 3-year period will be limited to 24 months. In other words: a maximum of 3 fixed-term contracts can be concluded within a maximum of 2 years. After an interruption of more than 6 months, the rule starts again. This interruption was formerly longer than 3 months. There are some exceptions, for instance arranged by collective labour agreement.

01/07/2015: Compulsory training

The current labour law has no requirement to arrange the training of employees. This obligation will be in effect from July 1, 2015. You will need to enable an employee to pursue training required for the performance of his work. This also applies if his position is dissolved or if he is no longer able to perform his work.An employee cannot be fired due to shortcomings if the inability to perform is due to the non-compliance with the training obligation.

01/01/2016: Unemployment insurance law (WW)

Each year of professional works accrues one month of WW. The maximum duration of this WW accruement is 38 months. From 1 January 2016, the maximum duration will be gradually reduced to a maximum duration to 24 months. Social partners can introduce a supplement of 14 months of WW through the CLA. At the moment, this is not the case.

What has been changed in the Work and Security Act?

As of January 1, 2015, a number of changes have already been implemented. What were these?

01/01/2015: No probation in six months contracts

Certain contracts of 6 months or less should no longer include a trial period clause. This applies to contracts concluded on or after January 1, 2015. The trial period must be agreed in writing and starts at the start of the employment contract. A maximum trial period of 2 months is allowed for permanent contracts.

8 01/01/2015: The notice period

For a fixed-term contract of 6 months or longer, a notice period will apply effective January 1, 2015. This also applies for renewed contracts. One month before the end of the contract, you must notify the employee in writing that the contract will be continued and if so, under what conditions. If you do not observe this obligation, you will owe the employee up to a monthly salary if the employment contract is not renewed. In case of late fulfilment, the compensation is due pro-rata.Ensure that the period or notice is not the same as the period for termination. Termination of an employment contract is only possible if the UWV has granted permission for dismissal. This concerns dismissal for economic reasons.

01/01/2015: No non-competition clause for fixed-term employment contracts

Temporary contracts may not include a non-competition clause. Deviations are only possible if you argue in writing in the employment contract that the clause is necessary based on important business or service interests. Compelling business or service interests differ per company. You must describe the business or service interest in the employment contract and this requires a non-competition clause. If this motivation is absent, the clause is invalid.A non-competition clause is still possible for contracts of indefinite duration.

Datum van publicatie: 29 June 2015