Breaking news from Dutch Supreme Court

Important news if you are an Employer in the Netherlands: you are probably aware that, if an employee is sick, the employer pays the wages for a maximum period of 24 months (or at least the legal minimum of 70%). It is only after these 24 months of illness that the employer can terminate the employee’s employment contract (with a UWV permit). The employee is entitled to payment of the legal Severance ('Transitievergoeding'). Since this Severance can be quite high, many employers chose not to terminate, in order to avoid having to pay this 'Transitievergoeding'.

The Dutch Supreme Court has put an end to this pragmatic solution of  ‘dormant employmentcontracts’ (without any costs). From now on, if the sick employee (with no prospect of reinstatement) asks to be dismissed in order to obtain his 'Transitievergoeding' you will be obliged to collaborate with this termination and the payment of the legally applicable Severance.

Note: under certain strict conditions it may be possible to obtain financial compensation from the government for this legal Severance ((‘Wet compensatieregeling Transitievergoeding’).

Expat ill? Beware!

Do you employ or are you a ‘highly skilled migrant’ read this.

If you employ a highly skilled migrant, as an employer you have the legal obligation to pay a certain minimumwage. If your employee falls ill be careful to continue to pay 100% of his salary or at least an amount that maintains the level of income above the legal minimum. Dutch law provides the possibility for the employer to pay only 70% during two years of illness. However if you do this - and fail to inform the IND in time - your company risks a fine of € 8.000,= and also risks to lose the status of Recognised Sponsor with the Immigration service (IND). This will also have consequences for other ‘highly skilled migrants’ you might employ.

Are you a ‘highly skilled migrant’ expat? In that case always check in your employment contract that your employer will continue to pay you 100% of your salary in case you fall ill. The Dutch law allows employers to pay only 70% of your salary during illness (unless otherwise provided for in a Collective labour agreement). If the employer pays only 70%, your income might fall below the legally mandatory minimum wage linked to your status. In that case your employer might lose its status as Sponsor at the Immigration services (IND) and this might have serious consequences for yourself (worst case: having to leave the country within 4 weeks).

LinkedIn use by employee: Employer’s contacts or employee’s?

Employer has asked the employee to use his personal LinkedIn account to search for suitable candidates (recruitment activities). The employee therefore needed LinkedIn in the execution of his work and he has added the candidates as a connection so that he could contact them via LinkedIn. After the termination of the employment contract, Employer asks the Court to condemn employee to remove these contacts from his LinkedIn account.  

This request is rejected because the employer has failed to make (prior) arrangements with the employee about the connections that the employee would make during his work. If the employer had wanted otherwise, he should have made arrangements about this with the employee or create a special professional LinkedIn. The court considers that the connections are not the employer’s property.

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New Dutch government to abolish dividend withholding tax and lower corporate income tax rates.

New Dutch government

 to abolish dividend withholding tax and lower corporate income tax rates.

 

After long negotiations following the Dutch general elections in March 2017, a coalition of four political parties have agreed to form a new government in the Netherlands. 

The coalition agreement contains the joint policy decisions that the incoming government intends to execute during its four-year term. This agreement was made public on 10 October 2017. The coalition agreement does not yet provide many details of the proposed measures. Consequently, the exact scope and impact of the measures is still unclear.

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Macron: new French Labor law...how about Dutch labor law?

Macron is trying to modernize French labor law by maximizing the Severance payment for employees to 20 months of salary. 

 

The Dutch Labor law has been fundamentally reviewed in 2015. Since, the maximum Severance for an employee is the equivalent of 12 months of gross salary. And this only after 2 years of service. 

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