With a fixed-term contract, too, there is a right to a transition payment (transitievergoeding) if the employer does not continue the contract. This applies from the first working day, however short the contract was (Article 7:673(1)(a)(3°) of the Dutch Civil Code). Successive contracts with intervals of no more than six months count together. In addition to the transition payment, a notice compensation (aanzegvergoeding) may be due if the employer did not state in writing in time whether the contract would be continued. Below you will find when the right arises, how the payment is calculated for short contracts and where the pitfalls are.
When does the right exist?
A fixed-term contract ends by operation of law on the agreed end date. The transition payment is due if the contract is then "not continued immediately at the initiative of the employer" (Article 7:673(1)(a)(3°) of the Dutch Civil Code). Since 1 January 2020 this applies from the first working day; the former requirement of two years of employment has been abolished. Notice given by the employer during the probationary period is also notice within the meaning of paragraph 1(a)(1°).
There is no right in three situations:
- the employee does not want to continue; the initiative then lies with the employee, unless the employer acted in a seriously culpable way (paragraph 1(b)(3°));
- before the end, a new contract was already agreed that starts within six months and can be terminated in the interim (paragraph 1(a)(3°), final part);
- the general exceptions of paragraph 7: an end in connection with the state pension (AOW) age, seriously culpable acts or omissions of the employee, or a young employee who leaves before their 18th birthday and worked on average no more than twelve hours a week.
If the employer offers a new contract and the employee does not accept it, the question is where the initiative lies. According to the explanatory memorandum, there is no right if an equivalent or better contract is refused, and the initiative remains with the employer if the offer is worse. The Court of Appeal of 's-Hertogenbosch quoted that passage, but expressly left open whether it must be followed in all cases (Court of Appeal of 's-Hertogenbosch 27 October 2016, ECLI:NL:GHSHE:2016:4808).
The notice compensation: a separate claim
With a fixed-term contract of six months or longer, the employer must state in writing no later than one month before the end whether it will continue the contract, and if so on what terms (Article 7:668(1) of the Dutch Civil Code). If it does not, it owes compensation of one monthly wage; if it does so too late, a pro rata compensation (paragraph 3). According to the Supreme Court, the notice compensation is also due if the employee already knew that the contract would end or suffered no disadvantage (Supreme Court 7 October 2022, ECLI:NL:HR:2022:1374).
The notice compensation is separate from the transition payment: both can be due at the same time. Two differences matter. For the notice compensation, only the wage under article 2 of the Besluit loonbegrip (Decree on the wage concept) counts; the extension with holiday allowance and other wage components in article 3 applies only to the transition payment. And the time limit differs: an application for the notice compensation must be filed with the cantonal court (kantonrechter) within three months after the day on which the notice obligation arose, an application for the transition payment within three months after the end of the employment contract (Article 7:686a(4)(b) and (e) of the Dutch Civil Code).
The calculation for short contracts
The transition payment is one third of a monthly wage per year plus a proportional part for the period after that. With a fixed-term contract, often only that proportional part is relevant. For it, the gross salary actually owed over the period counts; if the period consists of whole months with the same salary, this comes down to 1/36 of a monthly wage per month. If the employment contract lasted less than one month, the total wage over the contract, including wage components, is the monthly wage (article 4 Besluit loonbegrip).
Example 1: a six-month contract
An employee has a contract from 1 January to 30 June 2026 inclusive, with a gross monthly salary of €2,800 and 8% holiday allowance: a monthly wage of €3,024. The employer does not renew. The transition payment is 6 × €3,024 / 36 = €504. Because the contract lasted six months, the employer had to give written notice no later than one month before the end; if it did not, a notice compensation of one monthly wage under article 2 of the Decree is also due (€2,800).
Example 2: a three-week contract
An employee works from 1 to 21 March 2026 inclusive and earns a total of €1,890 gross over those three weeks, including holiday allowance. The contract lasted less than one month, so €1,890 is the monthly wage. The transition payment is €1,890 / 36 = €52.50. There is no notice obligation, because the contract lasted less than six months (Article 7:668(2)(b) of the Dutch Civil Code).
Both examples have been checked with the calculation engine of the transition payment calculator; for a short contract, it asks for the salary over the period itself.
Successive contracts and interruptions
If fixed-term contracts with the same employer follow each other with intervals of no more than six months, they count together for the length of the employment (Article 7:673(4)(b) of the Dutch Civil Code). The intervals themselves do not count. Two six-month contracts with four months in between therefore give one year of service: with a monthly wage of €3,024, the transition payment is €1,008.
With an interval of more than six months, the count starts again: the contract from before that interruption no longer counts. An earlier contract that the employee ended does not count either (Supreme Court 28 November 2025, ECLI:NL:HR:2025:1808). If the employee worked for different employers one after the other, successive employership (opvolgend werkgeverschap) may apply; see transition payment and successive employers.
Note the difference with the chain rule of Article 7:668a of the Dutch Civil Code, which determines when successive fixed-term contracts turn into a permanent contract. That is a different rule with its own time limits; for the transition payment only the rules of Article 7:673 of the Dutch Civil Code apply. The chain rule is explained on fixed-term and permanent contracts.
Other payments at the end of a fixed-term contract
If the employer acted in a seriously culpable way in not continuing the contract, the cantonal court can award fair compensation (billijke vergoeding) in addition to the transition payment (Article 7:673(9) of the Dutch Civil Code). If the parties agree on the end in a settlement agreement (vaststellingsovereenkomst), there is no statutory right to a transition payment and they determine the compensation themselves.
Conclusion
Anyone whose fixed-term contract is not renewed is entitled to a transition payment from the first working day, even after a few weeks. With short contracts the amounts are small, but successive contracts count together. Also check whether the employer gave notice in time: the notice compensation is a separate claim with its own time limit.
Key legal sources
- Article 7:673 of the Dutch Civil Code (paragraphs 1, 4, 7 and 9)
- Article 7:668 of the Dutch Civil Code (notice obligation and notice compensation)
- Article 7:686a(4) of the Dutch Civil Code (limitation periods)
- Besluit loonbegrip vergoeding aanzegtermijn en transitievergoeding (articles 2 to 4)
- Supreme Court 7 October 2022, ECLI:NL:HR:2022:1374 (notice compensation)
- Court of Appeal of 's-Hertogenbosch 27 October 2016, ECLI:NL:GHSHE:2016:4808 (initiative for non-continuation)
- Supreme Court 28 November 2025, ECLI:NL:HR:2025:1808 (earlier contract ended by the employee)