What to Do if You Have Been Dismissed from Your Job
Employment laws in the European Union offer robust protections for employees, including employees who have been dismissed from their job. Under European labor laws, no employee can be dismissed from employment without proper cause. If an employer wishes to terminate an employee’s employment contract and the employee does not wish to be dismissed, there are certain protocols the employer must abide by in pursuing dismissal. In the Netherlands, for instance, the employer must apply for a dismissal permit from the Dutch Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen, or UWV) to ask the court to dissolve the employment contract. If you have been involuntarily dismissed from your job due to COVID-19 or some other circumstance that is out of your control, there are certain things you should know about your rights as an employee and what sort of compensation you may be entitled to upon dismissal.
Impact of COVID-19 on the European Job Market
For months now, the novel coronavirus has been making its way across Europe, forcing businesses to close their doors to reduce the risk of transmission and slow the spread of the virus. From restaurants and bars to theaters, gyms, casinos, and sporting and entertainment venues, businesses of all types have felt an economic burden from the COVID-19 pandemic. As a result of their businesses being shut down, albeit temporarily, and their revenue suddenly coming crashing to a halt, employers in the Netherlands and throughout the European Union have been forced to find ways to reduce their labor costs and keep their businesses from going under during this crisis. Some employers have implemented immediate layoffs. Others are preparing for potential future layoffs and/or imposing pay reductions and redundancies as a result of the novel coronavirus.
What is Redundancy in Employment?
In employment, redundancy is a term used to describe a situation where an employer no longer has a need for, or has a reduced need for, an employee to perform a particular kind of work. A statutory redundancy situation may also arise in cases where an employee’s business is shut down, either completely or at a particular location. This may be the case for many businesses right now, due to the consequences of the coronavirus pandemic. In the UK, when an employer decides to make an employee redundant, or their job redundant, to be more precise, labor laws dictate that the employer must have a fair reason for the dismissal and follow a fair procedure in putting the dismissal in action. Labor laws also cover the payment of redundancy pay or transition pay to dismissed employees.
Fair Redundancy Procedure
As a general rule, in order to follow a fair redundancy procedure, employers making an employee redundant must first give the employee advanced warning of the redundancy and conduct a consultation with the employee before the dismissal can take place. In the UK, employers must also use a fair selection process when choosing which employees to make redundant, especially when there is a reduced need for employees to do certain types of work, but some employees are still needed. Employers are also expected to consider alternative employment for “at risk” employees, either at a different location or with an associated employer. When considering collective or large-scale redundancies because an entire workplace or a particular location is being shut down, which European businesses may be facing as a result of the COVID-19 crisis, employers have additional obligations to consult collectively with affected employees’ representatives.
Dismissal Requirements and Transition Pay in the EU
It is important for employees who have already been dismissed and those who face future dismissal to know that temporary or permanent layoffs are heavily regulated by European labor laws. These laws include certain provisions for employees whose employment contracts are terminated, such as mandatory severance pay, also known as transition pay. In Western Europe, transition pay is a form of compensation paid by employers to certain employees whose employment contracts are terminated or not renewed. The payment is intended to compensate dismissed employees for the costs they incur in finding new employment.
In the Netherlands, employers must pay a transition payment when they dismiss an employee, when they do not extend an employee’s employment contract, or when an employee resigns as a result of seriously culpable conduct or neglect on the employer’s part. Transition pay applies to both fixed-term (temporary) and indefinite-term (permanent) employment contracts, as well as on-call contracts. The transition payment can be used for education or outplacement, a support service offered as part of some severance agreements that is intended to help displaced employees find work following a layoff or job loss.
New Dutch Labor Laws
Dutch labor laws have undergone numerous revisions in recent years as part of an effort by the Dutch government to create a more balanced labor market. Effective January 1, 2020, employees in the Netherlands are now entitled to transition pay upon dismissal from employment beginning on their first day of employment. Under the old law, employees were only eligible for transition pay if the dismissal occurred after they were employed by the company for at least two years. There are some situations in which an employer is not required to pay a transition payment upon dismissing an employee. Those situations include the following:
- The dismissal is by mutual consent
- The dismissal is a result of the employee’s seriously culpable conduct or neglect
- The dismissed employee is under the age of 18 and worked a maximum of 12 hours per week on average
- The company is facing bankruptcy, has filed for suspension of payment or is in a debt restructuring arrangement
- The employee is of retirement age
- The employee and employer agree on a new fixed-term contract while the current contract is still valid
- The dismissal is for economic reasons and a different arrangement has been set forth in a collective labor agreement
Find Out if You are Eligible for Transition Pay from Your Employer
If you have lost your job or your employment contract has ended or has not been renewed, it is likely that you are entitled to a transition payment from your employer. We have extensive experience helping employees recover transition pay or severance pay following a layoff or job loss and we can help you receive your payment, too. Contact us today to get the process started.