Supreme Court puts an end to 'dormant employment contracts'
Date: November 08, 2019
Modified November 14, 2023
Written by: Ruud Olde
Reading time: +/- 2 minutes
Date: November 08, 2019
Modified November 14, 2023
Written by: Ruud Olde
Reading time: +/- 2 minutes
The Supreme Court has just published its - long-awaited - ruling on dormant employment contracts. It shows that in case of long-term disability of the employee, without any chance of recovery or return to work, an employer is obliged on the grounds of 'good employment practices' to agree to a proposal of the employee to terminate the employment contract by mutual consent.
In doing so, the employee must then be awarded compensation in the amount of the statutory transition compensation. However, this compensation does not have to be higher than the amount of the transition fee at the moment the employee has been unfit for work for two years. No transition compensation therefore needs to be paid over the "dormant part" of that employment!
Under certain circumstances, the employer does not have to cooperate in a termination, for example, if there are still return options. Not being able to pre-fund compensation may be cause to wait until April 1, 2020 when the compensation scheme comes into effect.
In all cases, wait until after Jan. 1, 2020 to enter into settlement agreements and be well informed about the content of such an agreement!
In previously published blogs, we reported on developments regarding "dormant employment". These can be found here:
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