Dormant employments keep us awake

The Supreme Court's decision of Nov. 8, 2019, regarding dormant employment contracts appears to (may) lead to ever new consequences. As is well known, the Supreme Court ruled then that an employer must cooperate in terminating a dormant employment contract, if the employee so requests. That employee is then also entitled to payment of the transition compensation.

One of the Supreme Court's arguments for arriving at this judgment was that on April 1 next, the Compensation Scheme will take effect, under which the transitional compensation paid by the employer can be (partially) reclaimed from the UWV.

Compensation for retired 'sleepers'

Meanwhile, two courts have awarded compensation to employees, who had already retired before the Supreme Court ruling, because their employer had refused to cooperate in terminating their dormant employment early. As a result, these employees ended up retiring without being paid the transition compensation.

Poor employment practices

Both courts hold that retired employees are also entitled to compensation if the employer, as a good employer, should have cooperated earlier in a termination. The compensation to be paid by the former employer is then a compensation for 'bad employment practices' to replace the missed transition compensation. Moreover, there is already bad employer character if the employer refused to cooperate after July 20, 2018: on that date, the Compensation Scheme was announced and the employer could have known that he had a 'duty' to cooperate.

Former employees can sue you

With these rulings, there is a new group of former employees who may (still) be able to sue their reluctant former employer. Just so you know.

Want to know more or the current state of affairs regarding sleeping arrangements? During our current affairs luncheon, we'll tease out the initial experiences surrounding the Labor Market in Balance Act and we'll be happy to update you on other current events in employment law.