Ending your labor contract with a termination agreement

Including example termination agreement (English version of Dutch vaststellingsovereenkomst ) and template termination agreement.

You are summoned by your boss. He presents you with a termination agreement (vaststellingsovereenkomst in Dutch), with the request to sign this agreement, preferably as soon as possible. However, should you actually do this? Should you agree to your dismissal? Will you still be entitled to unemployment benefits (werkeloosheidswet)? Are you not entitled to a (higher) severance payment? And how about the mandatory notice periods?

You can read the answers to your possible questions regarding the settlement agreement below. If you still have questions after reading this, or would you like your agreement to be assessed FREE OF CHARGE , you can contact us by phone or email. We can also negotiate better dismissal conditions for you, or prevent your dismissal.

Termination agreement: what are the rules under Dutch law?

It is possible to terminate an employment contract while maintaining the right to unemployment benefits through a termination agreement, also known as a settlement agreement. This is an agreement in which two or more parties establish a binding arrangement for the prevention of or solution to a dispute — for example, an arrangement between employer and employee concerning the termination of an employment contract.

In the agreement, the conditions concerning the dismissal are recorded in writing. In the Dutch Civil Code, the settlement agreement is described in Book 7, Articles 900 through 906. To maintain the right to unemployment benefits, it is no longer necessary to go through a district court procedure (kantonrechtersprocedure) or a procedure at the Employees Benefit Agency (UWV). However, the text of the agreement must be drafted properly, and the correct notice period applicable to the employer must be taken into consideration. Our dismissal specialists can assist you with drafting or reviewing the proper text.

Legal consequences of the termination agreement

Parties cannot, in general, claim fraud or misrepresentation after entering into an agreement. Therefore, a settlement agreement can rarely be overturned, adjusted, or terminated. The rule is: what has been determined, is determined . It is therefore of the utmost importance that you fully understand which agreements are incorporated in the settlement before you sign.

What is incorporated in the agreement?

To start with, the general data of the parties are included — names, addresses, the position of the employee, and the commencement date of employment. The reason for termination must also be stated. To avoid problems with obtaining unemployment benefits, this must be a neutral cause (e.g. business economic reasons or a disturbed employment relationship) not caused by the employee. The termination date and any severance payment must also be included.

Additionally, the following items are commonly addressed:

• Whether the employee will be exempt from work for the remaining period of the employment contract
• Whether remaining vacation days will be paid out
• Whether company items (e.g. laptop, telephone) must be returned
• Whether a non-competition clause or non-solicitation clause remains in effect after termination

Finally, there will be a provision that the parties grant each other full discharge once all arrangements are fulfilled. It is essential that the agreements concerning the rights and obligations of both parties are complete before signing.

Termination agreement in case of sickness

In most cases, it is not recommended to enter into a settlement agreement when you are sick. Obtaining unemployment benefits or benefits under the Sickness Benefits Act is often not possible in that situation. However, there are exceptions — in particular if the sickness is connected with the employment relationship (situational invalidity). In any case, ask for expert advice before accepting a settlement agreement when you are sick.

Termination agreement in case of pregnancy

It is possible to enter into a WW-safe settlement agreement when pregnant. However, it is not recommended to agree to a dismissal proposal too quickly. Due to your pregnancy, you will have fewer opportunities in job interviews, and you are entitled to additional dismissal protection. A better arrangement is often achievable — for example, postponing your dismissal date until after maternity leave, or obtaining a higher severance payment. Our lawyers frequently accomplish this. If you are pregnant and facing dismissal, call or email us.

Free advice — you have nothing to lose

Due to the large interests involved when entering into a settlement agreement, professional legal advice is strongly recommended. Our dismissal specialists have extensive experience and knowledge on this subject.

You can have your settlement agreement checked free of charge by our specialists. Then you will know for sure that you will receive what you are entitled to and that your unemployment benefits are not jeopardized. Our initial advice is FREE OF CHARGE — you can only benefit.

Results guarantee in dismissal negotiations

If you leave the negotiations to our dismissal specialists, we will stand up for your interests and additionally try to have the legal costs reimbursed by your employer. Usually we succeed in this. And if your employer is not willing to reimburse the costs, we offer a unique guarantee: the negotiations will not cost you anything (*) if they do not result in a better arrangement than what your employer originally offered.

You can never lose. Enlist our professional legal assistance today to negotiate your termination agreement.

📞 Call: 020 6160 120 or send us an email for advice

About the author: The above article was written by Edwin van Jaarsveld.

Edwin is a law graduate and has been providing legal assistance with dismissal and settlement agreements for over 25 years. Is dismissal imminent? Contact us immediately at 020 6160 120 .

Example termination agreement / template

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(*) unless other agreements have been made with you