The average "transition compensation" included in a settlement agreement (VSO) is 0.57 gross monthly salary per year worked. This is therefore 0.24 gross monthly salary higher than the legal calculation. The compensation is therefore higher on average when a lawyer negotiates a VSO.
In theory, there is no right to a transition fee in the case of a settlement agreement (VSO). The employer only owes a transition fee when a dismissal via the UWV or dissolution via the subdistrict court takes place. However, it is common for the VSO to include a severance payment that is as high or higher than the statutory transitional compensation.
You have no entitled to a transition allowance if you resign yourself (except if employer has acted seriously culpable), you are seriously culpable for the dismissal and if the employer has been declared bankrupt or has a suspension of payments. This also means that if you decide not to extend the fixed-term employment contract you will no entitled to a transitional payment.
You are entitled to a transition allowance when the employer takes the initiative to terminate the employment contract through the UWV or Cantonal Court. The conditions herein are that you do not serious culpable dismissal, such as in cases of theft or fraud, among others. This means that you are also entitled to a transition allowance if the employer decides not to extend your fixed-term employment contract.
Of course, tax has to be paid on the transitional compensation / severance pay you receive. How much tax you have to pay depends on your annual income. In 2023, there are two rates applied:
Annual income up to €73,031 you pay 36.93% tax
Annual income from €73,031 you pay 49.5% tax
That is certainly allowed. We even advise doing so. The settlement agreement was drawn up by the employer. Are all the agreements on paper correct as you have agreed? And do you get everything out of the agreement financially? VSO to be checked.
Our employment lawyer checks your offered VSO free of charge.
Your employer will request your dismissal from the UWV. This can be done if you do not agree to your dismissal and therefore do not agree to a settlement agreement.
Even in the case of business economic reasons or long-term disability, the employer can request your dismissal through the UWV. Of course, this must be a well-founded application, otherwise the UWV cannot assess it.
In exceptional cases, your employer has the right to summarily dismiss you. This means you will be dismissed with immediate effect. The current employment contract will be dissolved without notice. Your employer does not need permission from the subdistrict court for this. However, this cannot be done just like that and there are strict requirements before the employer can resort to such an extreme measure.
You also have rights in the situation of a labour dispute between you and the employer. For example, your boss is not allowed to unilaterally change the content of your job. He may only do so if this is included in your contract. This can lead to a conflict if you do not agree with the new position. You may also not be dismissed because of illness, but dismissal during illness is allowed. You may have fallen ill due to the industrial dispute. Often, a dismissal by mutual agreement and a settlement agreement is then the best solution. Dismissal and illness is often a complex situation that requires expertise and experience. Get advice and assistance from an employment lawyer.
There is no generally applicable formula for severance pay. The amount of this compensation is calculated based on x number of months or the transitievergoeding times two. But this depends on all the facts and circumstances applicable in your specific situation.
The subdistrict court formula is a formula that the severance pay calculates. Dutch subdistrict courts developed this guideline to calculate the amount of the so-called dissolution compensation. With effect from 2015, subdistrict courts no longer use the subdistrict court formula for dismissal, but the severance pay and any additional compensation on top of this severance pay. In case of individual dismissal by mutual consent (settlement agreement) and collective dismissal, the subdistrict court formula can still be used to determine compensation.
After you and your employer have jointly agreed that your employment contract will be terminated, he will issue a settlement agreement on. This document contains your details and all the agreements made.
Our employment lawyer will be happy to assist you. Thanks to years of experience and the right expertise, he has the answers to all your questions surrounding your dismissal. Contact us via the contact form.
A settlement agreement, or a termination agreement, is drawn up if your employer wants to terminate and dissolve the employment contract with you. This agreement can also be an option if he does not want to extend the current temporary contract. With the condition that you have agreed this together. If one party does not agree to this course of action, then a settlement agreement is not applicable and you will have to dissolve the contract in some other way.
Have you already received a settlement agreement and want it reviewed? Send the document to us and our employment lawyer will review the agreement.
If you have been made redundant, you will find yourself in an uncertain and emotional situation. At such a time, it is nice and good if an expert thinks with you. He can look after your interests and stand up for your rights. Extensive information on dismissal, severance pay and transition compensation can be found on the page resign.
You can very easily calculate the amount of your severance pay online. Enter your details in the form and you will see the amount of your transitional allowance. Of course, this does not fix the final amount.
The amount of your transition allowance is one-third of your monthly salary per year of service and with a maximum amount of €89,000