Last month, a lot of attention went to a lawsuit handled by the Court of Amsterdam. The case involved an employer and employee who had entered into an employment contract without an interim termination clause included. Such a clause is mandatory in order to be able to terminate employment before the end date stated on the contract and for an employee’s eligibility to an unemployment benefit, called ‘WW-uitkering’ in Dutch. If an employer and employee mutually agree to premature termination of a temporary contract without an interim termination clause, the employee in question will not be eligible for an unemployment benefit until the end date stated in the respective contract – as defined by article 19, section 4 of the ‘Werkloosheidswet’ (Unemployment Act).
The employer and employee had found a solution together: they decided to include an interim termination clause in the settlement agreement drawn up for a dismissal with mutual consent. However, the UWV (the National Institute for Employees’ Insurance and Regulations) did not regard the clause included in the settlement agreement a legitimate ground for eligibility for an unemployment benefit. The matter was taken to court. The judge ruled that an employee is eligible for an unemployment benefit if an interim termination clause has not been included in the contract, provided that such a clause is agreed upon prior to the actual dismissal of the employee, for example in a settlement agreement. The ruling does not clarify whether or not the employee in question has committed a prejudicial act by cooperating in the inclusion of the interim termination clause in the settlement agreement, in which case he could lose his right to an unemployment benefit. It is therefore possible the UWV will appeal the court ruling, meaning clarification must be provided on whether or not the actions of the employer and employee are a legitimate remedy for any employment contract missing an interim termination clause.
Court of Amsterdam, August 11, 2021; ECLI (abridged): 4295