Termination of an employment contract under Dutch law

Q: Are there restrictions on how quickly an employment contract can be terminated?

Under certain circumstances such as serious misconduct or fraud, the employer may have grounds for immediate dismissal (ontslag op staande voet) without notice period. However, dismissal in such cases must meet specific conditions and may require prior permission from a court. In most other situations, employers should follow procedures outlined under Dutch employment law, including giving reasonable notice.

How do you terminate an employment contract under Dutch law?

Eva Jongepier, Chief Legal Editor – Dutch Employment Law - employment lawyer in the Netherlands
publication date: June 20, 2024
last updated: August 30, 2026

Termination of the employment contract under Dutch law

Termination of an employment contract under Dutch law requires following specific rules and regulations, so that both employers and employees understand their rights and obligations when ending an employment contract (arbeidsovereenkomst).

This article covers the key considerations when ending an employment contract under Dutch law, including grounds for termination, notice periods, severance pay and dismissal protection. For a full walkthrough of the available termination routes, see our overview of termination of an employment contract.

What Are the Grounds for Terminating an Employment Contract?

Under Article 7:669 of the Dutch Civil Code, an employer must rely on one of the statutory grounds for dismissal, broadly falling into economic or organisational grounds (such as restructuring or reorganisation) and grounds relating to the individual employee (such as misconduct, poor performance, or long-term illness). The applicable dismissal procedure depends on which ground is invoked.

For example, an employee found guilty of fraud or theft would constitute justifiable cause for dismissal, while prolonged absenteeism due to illness could also provide sufficient grounds depending on its severity and duration. Employers must follow the applicable procedure and meet severance payment obligations (transitievergoeding) regardless of which ground applies.

What Notice Periods and Severance Payments Apply?

Under Article 7:672 of the Dutch Civil Code, the employer's statutory notice period depends on the employee's length of service: one month for less than five years, two months for five to ten years, three months for ten to fifteen years, and four months for fifteen years or more, unless the contract or an applicable collective labour agreement provides otherwise.

In addition to observing the notice period, the employer must generally pay the statutory transition payment (transitievergoeding). During the notice period, the employee remains entitled to all regular rights under the employment contract. Failure to comply with these requirements can expose the employer to financial penalties and claims from the employee.

What Dismissal Protection Applies under Dutch Law?

Employment law in the Netherlands provides a strong level of protection for employees facing dismissal: the employer must demonstrate a valid ground that outweighs the impact on the employee, and must follow the correct procedure before terminating the contract.

If it is found that an employer has not complied with the appropriate procedures or acted unlawfully, the employer may face significant penalties and other legal consequences, and the employee may be entitled to dismissal protection remedies.

What Happens If a Termination Is Unlawful?

Unlawful termination occurs when an employer ends the employment relationship without having lawful grounds for doing so, or without following the correct procedure. Employees may claim compensation, or damages caused by discrimination on the basis of race, gender, religion or any other protected characteristic.

An employee who believes their termination was unlawful can challenge it before the subdistrict court (kantonrechter); the applicable procedure and time limits depend on the type of termination involved. If the claim succeeds, the employee may be entitled to compensation for lost wages and benefits, in addition to any statutory transition payment.

What Applies to Collective Redundancies?

A collective redundancy (collectief ontslag) is governed by specific legislation: the employer must consult with employee representatives before deciding on redundancies, discuss measures to avoid or limit dismissals, and give advance notification to the UWV and trade unions.

If an employee believes they were unfairly dismissed as part of a collective redundancy, they may challenge it before the courts or the UWV, for example by arguing that the selection criteria were applied incorrectly.

Key legal sources

Article 7:669 of the Dutch Civil Code - statutory grounds for dismissal
Article 7:672 of the Dutch Civil Code - statutory notice periods based on length of service
Article 7:673 of the Dutch Civil Code - statutory basis for the transition payment

Frequently Asked Questions

What is the process for terminating an employment contract under Dutch law?

The first step is for either party to give notice in writing about their intent to terminate the contract. They then need to specify whether they wish to do so with immediate effect or at some point in the future, taking into account the proper notice period (opzegtermijn).

In certain cases where there has been serious misconduct by the employee (such as theft or fraud), provisions may exist to dismiss someone instantly. Employers must understand these specific rules under Dutch law before taking action; failure to do so could result in claims of unfair dismissal.

Is an employee entitled to severance pay upon termination?

Under Dutch law, employees can be entitled to severance pay (transitievergoeding) when their employment contract is ended. Specific conditions must be met, and the employer must provide evidence that they have taken steps to mitigate the impact of dismissal - such as providing alternative job opportunities or offering outplacement services.

The amount of severance pay depends on factors such as length of service. Employers may also choose to enter into agreements which guarantee additional financial protection for employees facing termination, although this is not required by law.

Is it possible to terminate an employment contract without cause?

Termination of contracts without cause is not allowed under Dutch law. Employers must provide a valid reason for ending the agreement before they can legally terminate it. If no such grounds exist or if the reasons provided are insufficient, then the employer will likely face consequences.

Even if a company has sufficient grounds for dismissal, they should still consider any potential legal action taken by their former employee in court as well as other relevant aspects of employment law in the Netherlands.

What rights does an employee have if their termination was unlawful?

Employees should understand that employers must provide proper notice to terminate a contract. If the employer fails to give proper notice or deliberately terminates without cause, the employee may be entitled to severance pay or reinstatement (herstel van de arbeidsovereenkomst).

Employees should always seek advice from a qualified lawyer familiar with employment law in the Netherlands. A Dutch employment lawyer can help make sure all potential rights are properly enforced and that any further action taken is legally sound.

Are there restrictions on how quickly an employment contract can be terminated?

Under certain circumstances, such as serious misconduct or fraud, the employer may have grounds for immediate dismissal (ontslag op staande voet) without notice period. However, dismissal in such cases must meet specific conditions and may require prior permission from a court.

In most other situations, employers should follow procedures outlined under Dutch employment law. This usually involves giving employees reasonable notice and providing them with ample time to respond if they disagree with the decision.