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11 proposed changes in labour law

At this point in time new labour law is being consulted by the Dutch Government. Via this way we would like to give an update on the proposed changes which may come in effect per 1 January 2020 with the ‘’Wet Arbeidsmarkt in Balans’’.

Labour Contracts

Now: Three employment contracts can be given within a period of two years. In our branches that was often an initial employment contract for seven months, followed by two employment contracts of eight months.
New: Three employment contracts in three years can be given before the employee is entitled to an employment contract for an indefinite period.
Now: You can call on-call workers when you need them. There is no minimum time limit for making a call.
New: If you work with on-call workers you have to call them up at least four days in advance. If you cancel within four days, the employee will be entitled to salary payment for these hours. You are also required to offer an employment contract for a certain number of hours in the thirteenth month of a on-call agreement. This is based on the average amount of hours in the previous twelve months.

Dismissal law

Now: Before the subdistrict court judge can terminate an employment contract, one ground for dismissal - such as dysfunction or a disrupted employment relationship - must be completely fulfilled. This is often not the case, which means that the court cannot terminate the employment contract.
New: A request to the subdistrict court may be based on a combination of factors. You can think of a disturbed employment relationship in combination with insufficient functioning. The downside is that the judge can grant a higher severance payment when invoking the cumulation basis. The extra reimbursement is a maximum of half the transitional remuneration to which the employee is entitled. A judge will look at the circumstances of the case.

Transitional remuneration

Now: Only after an employment of 24 months the employee is entitled to a transition payment if the employer terminates the employment.
New: Employees are entitled to the transitional remuneration from the first day of their employment, even in the event of dismissal during the probationary period.
Now: The amount of the transitional remuneration is 1/6 monthly salary per half year worked for the first ten years of employment. After that, the ¼ monthly salary is worked per half year.
New: The transition allowance is 1/3 monthly salary per year that of service.
Now: Do you want to quit your shop due to retirement, illness or death? Then there is no compensation scheme for the transitional remuneration.
New: As of January 1, 2021, small employers up to 25 employees will be compensated for the transitional remuneration if they have to terminate their company due to retirement, illness or death.
Now: There is no compensation for paying the transitional remuneration to employees whose employment has been terminated due to long-term disability.
New: As an employer you can reclaim the transitional remuneration that you have paid to employees whose employment has ended due to long-term disability. This scheme works back up to and including 1 July 2015. The intention is to make applications possible from 1 April 2020. Do you want compensation for the transitional remuneration paid between July 1, 2015 and April 1, 2020? Then apply before 1 September 2020. In general, the compensation can be requested six months after payment of the transitional remuneration. In order to be able to submit the application, it is important to keep all the documents relating to the termination and the paid transitional remuneration well.

Premium levies

In the area of ​​premium taxation too, the necessary changes will be made with the Labour Market in Balance Act (WAB). These measures are meant to increase the number of permanent jobs.

Now: The level of the unemployment insurance contribution depends on the sector in which a company is active.
New: The WAB introduces a low and a high unemployment insurance premium. The sectoral premiums will be abolished. We expect that the abolition of the sectoral premium will lead to savings across the entire wage bill.
Now: No difference in unemployment insurance premium by type of contract.
New: From 1 January 2020, employers will pay a low premium for fixed contracts and the low premium plus 5 percentage points for flexible contracts. The low premium is expected to be 2.78 percent. With the high premium that is 7.78 percent. The high and low premiums both benefit the General Unemployment Fund (AWF).
Now: There is a difference between on-call agreements and flexible agreements. But as mentioned earlier, this does not matter for the premium.
New: A new definition of the on-call agreement is introduced with the WAB, namely all flexible fixed-term contracts are viewed as a on-call agreement with regards to premiums.
New: The high unemployment benefit premium does not apply to BBL programs.