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Compensation

An employee is often compensated in case of dismissal. In defining the basic compensation (‘transition allowance’) a standard formula is used.

Transition payment
Employees with an employment contract gain a legal entitlement to severance compensation. This compensation, the ‘transitievergoeding’, is owed when the employer has taken the initiative to terminate the contract (and also when a temporary contract is not extended by the employer).

Calculation transition payment
The transition allowance is (roughly) a third month’s salary per year worked. If the employment contract is terminated based on reasons which on itself would not, but together do form ground for termination the transition allowance may be multiplied with (maximum) a factor 1,5.

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Maximum basic severance
The maximum transition allowance is EUR 83,000 (2020), or, if higher, a year’s salary.

Equitable Compensation

There can be circumstances in which a cantonal judge may award an extra compensation, on top of the transition allowance (multiplied by 1,5). Please feel free to contact our employment lawyers for further details.

Always entitled to a transition allowance?
You will normally not be entitled to a transition allowance, when you resign of when a summary dismissal took place.

Our specialists

Charlotte Buijsman
Employment lawyer litigation and advisory

Michiel Dekker
Employment lawyer litigation and advisory

Our specialists

Charlotte Buijsman
Employment lawyer litigation and advisory

Michiel Dekker
Employment lawyer litigation and advisory

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