Author: André Beukes

My experience includes to manage organizational change processes, strategic competence management, strategic employee relations, personnel selection, mediation and general personnel practices. I am experienced to act as a consultant, policy advisor and problem solver in demanding multi-cultural environments. My studies in International and European Labour Law and International HR equipped me to manage Human Resource Management policies and principles, new tendencies and applications in the holistic practices and principles of an organisation with exceptional success. http://linkd.in/HxkpjJ

Difference between to confirm (aanzeggen) and termination (opzeggen) of employment

With the new Dutch Work and Security act it is important that managers in the Netherlands understand the difference between to confirm (aanzeggen) or terminate (opzeggen) employment.

Procedure: confirmation of the ending of  the temporary employment (contract)

Issue a confirmation in writing  to the employee about the ending of the employment 1 month before the contract ends.

When is confirmation that the (temporary) employment (contract) will end applicable

  • Only applicable on temporary contracts of 6 moths and longer,
  • Not applicable on temporary contracts without a determined end date,
  • There is no further steps to be taken after the confirmation to end the employment,

Procedure if confirmation was not issued

  • The employment ended but the employee is entitled to a month salary.

 

Ending of an employment contract

Applicability

  • When a contract is ended before the specified ending date,
  • Employment contracts for indefinite period.

Procedure to end the employment contract

There is two ways that employment contract can be terminated:

  1.  Confirmation of the UWV ( Poor working performance and incapacity),
  2.  Mutual agreement between employer and employee.

Click here for a Dutch Labour Law case where the employer unlawfully ended an employment contract before the end date.

 

 

 

 

 

 

Getting to know the new Dutch Work and Security act: Labour Law for managers

The new Dutch Work and Security act makes it essential that all Dutch managers must realign their management practices to ensure that they are prepared to handle employee misconduct and poor performance.  Prevention is better than cure!
#dutchlaboutlawformanagers

Dirkzwager advocates produced an informative video as an introduction to the new Work and Security act. Below the video you will find a discussion of a few aspects mentioned in the video that are important for Dutch managers.

  • The Dutch Work and Security act was promulgated to make Dutch Labour law more flexible and simple. The new Dutch Labour Law dispensation puts a lot more responsibility on the shoulders of managers. Labour Law issues must be handled in the workplace and only serious issues must follow the legal (courts) or official (UWV) route. As discussed in earlier posts, managers were spoiled with the previous system where labour issues was quickly revered to a third party. Managers and HR departments must ensure that their knowledge and skills must be updated to be equipped to handle this new challenges.
  • In a way Dutch HR managers have failed their companies as managers are not prepared for the new Dutch Labour Law. The Volkskrant reported on 26 January 2016, that Dutch employers are “afraid” and nervous about the new Dutch Labour Law amendments.
    • Click here to read more about the question if the trepidation of employers about the new Dutch dismissal law is an indication of ill-equipped  HR managers.
  • There are limited valid reasons that an employee can be summery be dismissed for. The response of Dutch labour lawyers and even human resource experts is a source of concern. One and all advise that employers must focus on casefile building and they even present courses on how to build a casefile to ensure that a dismissal will be confirmed in a court. It is not surprising that Dutch employers are terrified by possible court proceedings if the building of a casefile is their main response to misconduct and poor performance. Case building is reactive, it must be a consequence of performance management not a goal in itself.
  • A transition allowance must be paid when an employee is dismissed irrespective if they were permanent or temporary employed. The allowance is only applicable for employees with more than 2 years of service. The allowance is calculated from the monthly salary and years of service.
    • Further can a judge in a case where the Employer acted unlawfully or wrongfully award additional compensation even if an employee is not two years in service,
    • This emphasizes that all Dutch employers must have fair and pro-active labour practices in place because courts apply a strict approach when determining if an employer acted fairly.
    • The Grolsch case is an excellent example of the consequences if employee conduct is not managed.
    • The Collective Labour Agreement can also contain prescriptions for a transition allowance.
  • The new chain determination for temporary employment prescribes that from 1 July 2015 a temporary employee become automatically permanent after working two years temporary at the employer. All the periods between the contracts shorter than 6 months can be counted together to form a chain of two years.  The temporary contract becomes also permanent after three (3) continuous contracts.
  • Restrained of trade provision is only valid if the employer can provide reasons in writing why the service or operating interest of the employer would seriously be jeopardized if the restrain of trade is not enforced.
    • Click here for a current Dutch Labour Law case about a pizza chef that were employed temporary with a restraint of trade clause in his contract.

 

Dutch Labour Law for managers

Contact me! Andre Beukes LLM, Dutch Labour Law for managers

 

Dutch startup visa, one year after the launch

Dutch startup visa, one year after the launch

Visit StartupDelta

As of 2015, the Dutch startup visa makes it possible for ambitious entrepreneurs to apply for a temporary residence permit for the Netherlands. The so-called residence permit ‘scheme for start-ups’ affords ambitious entrepreneurs one year to launch an innovative business. A prerequisite is that this start-up must be guided by an experienced mentor (facilitator) that is based in the Netherlands.

One year after the launch we are proud to show you a brief overview of the applications in 2015.

More information on the residence permit on the site of the IND

StartupDelta is working on the roll out a European startup Visa.

At at the informal meeting of Ministers responsible for research and innovation in January 27th 2016 (during the Dutch European presidency), Neelie Kroes launched the proposal on a European Startup Visa. The proposal was received with great enthusiasm.

You can read Neelie Kroes’ speech on the press page

whatsapp1

Dutch Labour Law for Managers #8

An employee was summary dismissed via WhatsApp, is it legal. What is the consequences?
Dutch Labour Law for Managers #8
Click here to receive a weekly Dutch Labour Law newsletter.

Extract of a recent Dutch Labour Law court case

The employee concerned was summary dismissed via WhatsApp after the employer and employee had conflict on WhatsApp about timetable issues. The employee did not receive a termination letter in writing. The employee was unsure why she was dismissed.

  • The judge found that in this case there is not an urgent reason for dismissal present.
  • The judge found that in terms of article 7:672 point 9 and 10 (Dutch Civil Code) that the party that broke the employee contract prematurely must pay damages to the other party equal to the salary that the employee should have received if the contract was not terminated. The employee was indefinitely in service with a 0 hour contract.
  • The judge took in account that termination period of a month is applicable.
  • That the employment contract was not legally terminated because the employee did not agree in writing with the termination as required by article 7:671.1 (Dutch Civil Code), and that the employee is entitled to compensation.

Finding

  • The employer must pay the employee 1000 euro compensation in terms of article 7:681,
  • The claim of 563 euro compensation for the notice period is approved in terms of article 7:672 point 1
  • Transition allowance of 389,60 euro in terms of Article 673 point 1,
  • The employer is responsible for the legal fees of the case.

Good to know

  • It is going to be very difficult to convince a Judge that a case is urgent with only WhatsApp evidence,
  • All official correspondence that are part of the case file must be in writing,
  • The Employer can only terminate an employment contract with the written consent of the employee,
  • The employee can within 14 day’s withdraw the written consent as was mentioned in point 1 in writing without reasons.
  • The party that broke the employee contract prematurely must pay damages to the other party equal to the salary that the employee should have received if the contract was not terminated, normally the damaged may not be less that three months salary,
  • Transition allowance is due to the employee if the employment relation was at least 24 months.

 

Rechtbank Gelderland

Case: 4514876

Link to case

Click here to receive a weekly newsletter.

Tags:  Dutch Labour Law, dismissal, urgent reasons for dismissal

lfjob

Dutch Labour Law for Managers #7

Dutch unemployment: the lost group
#dutchlabourlaw

Since the economic crises of 2008 the number of people in the Netherlands that receives welfare assistance increased dramatically. If it is considered that a household exists out a number of people, nearly 800 000 Dutch citizens are dependent on welfare income. Some households receive already for more than 15 year unemployment welfare grants.

The forgotten group that the Dutch Government and community ignore is plus minus 110 000 people strong. They are a quarter of all the longtime unemployed and are not physically or mentally handicapped. 65% of this group only have a starter qualification (below vocational training) and most didn’t even finish middle school.

The handicapped unemployed is catered for in terms of the Participation act (Participatiewet), and success stories where a long term unemployed was reintegrated are mainly from this group.

According to Ton Wilthagen, professor in Labour Market Studies at the Tilburg University there is almost no chance that these unemployed people will get a position in the normal job market because the requirements to be employed are just to high. The prescribed basic salary makes the employment of this group of unemployed people, just too expensive for employers.

The consultancy De ArgumentenFabriek  found that the position for people older than 45 years are especially dire as there is only a 13% change that they are going to employed within a year. Of this unemployed age group 20% is already more than 15 years on welfare.

The FD wrote an opinion piece on this lost group with the title: A welfare grant is silently an agreement to do nothing.

With the “do nothing” there are two aspects that are implied  :

  • The indirect message is that the Dutch Government is actually paying you not to work,
  • and secondly that the the Government is not planning to take remedial steps to address the predicament of the longtime unemployed.

The Dutch economy is steadily improving after the 2008 economic crises, but is it not reflected in the Dutch unemployment figures. According to the FD unemployment increased nearly with a half from 2008 to 2015. (304 000- 442.000)

netherlands-gdp-growth

Interesting enough the FD also highlights that there is one age group where the percentage that receive a grant is decreasing: the age group 15-27 years. The reason for this tendency is that the Government is actively involved with initiatives, legislation and rules where this age group must either work or get a job in the formal sector. The opinion piece suggests that this principle must be made applicable to all unemployed people in the Netherlands: they must either work or study, where passivity is not an option.

As not every person has the same ability to study I will substitute study with learning a skill that is needed in the workplace.

Implementation of official policy

As it can be seen from the graph below the reality is that from 2013 it is clear that the budget for welfare grants increased and the budget for reintegration to the workplace decreased.

Kan de Bijstand beter    De Argumentenfabriek

De ArgumentenFabriek

The decision of the Municipal Council of Amsterdam shed a bit of light on the direction that the management of the unemployment situation in Netherlands is heading. The rule is that unemployed people on welfare must provide proof that they applied on a weekly basis for work. The Council of Amsterdam decided in January 2016, that people on welfare that have a minimum chance to be employed may instead of applying for work also do volunteer work.

The Councils of Groningen, Leeuwarden, Wageningen, Nijmegen and Tilburg are also experimenting with a concept of a basic income. The basic income is a fixed (monthly) income that is provided to all citizens by the government, without a means test or work requirement. The basic income is high enough to ensure a life as full members of society. The idea is that an unconditional basic income, where people does not provide any counter action to receive it, end the concept of a “patronizing welfare state”.

Reasons why the lost group must be reintegrated in the work force

  • The welfare cliff. It is very difficult for the long term unemployed practically and emotionally to again join the workforce,
  • Children that grow up in a welfare home may have difficulty  breaking out of the system,
  • The FD commends that receiving long term welfare benefits is not a springboard to employment but a prison of unemployment,
  • People that receive long term welfare benefits have a small world and little hope for the future,
  • The benefits give a false feeling of security, as it is unsure if the Government will in the future be able to maintain the level of spending,
  • Working Helps You Stay Physically and Mentally Healthy
    Not only can working delay the onset of age-related diseases like dementia, but keeping mentally and physically active helps you feel younger longer. Working also keep you socially active and prevents isolation, and can provide a sense of purpose.

Can the Dutch community afford to not reintegrate this lost group in the workplace?

andre1

Andre Beukes LLM

 

 

Dutch Labour Law for Managers: What is the “Basic income” concept?

A basic income is an income unconditionally granted to all on an individual basis, without means test or work requirement.
Excerpt from basicincome.org

Multiple surveys across many countries show an increasing support for the idea of providing every citizen with a monthly lump-sum allowance to ensure everyone can meet their basic subsistence needs. In France, the IFOP (a leading French national market research institute) has shown that this support goes beyond political orientation divisions. From the question: “Are you in favour of implementing a guaranteed basic income for all citizens which would replace most existing allowances?” came a positive answer, depending on the degree of support for one party or another, from 72% to 79% for left wing sympathizers and from 50% to 54% for right wing sympathizers.

The Finland experiment

Since the election in April of the Finnish pro-basic income coalition, the topic has given rise to renewed international interest. All started when the Prime Minister of Finland Juha Sipilä announced the launch of a series of pilots, the most important being a “universal basic income” [1], in order to reform the social security system in response to the evolution of the labour market. This will also allow the evaluation of how to reinforce autonomy and incentives to work, as well as reducing bureaucracy and the complexity inherent in accessing social assistance.

The lead role in this project has been given to professor Olli Kangas (KELA) who has outlined the following schedule[2]: preparation phase from December 5th, 2015 to November 15th, 2016; two-year experimentation starting in 2017; evaluation in 2019.

Olli Kangas explained that the work group will evaluate at least four options:

  1. a “full basic income” (~800 €) replacing almost all basic and insurance-based benefits;
  2. a “partial basic income” (~550 €) replacing all basic benefits but leaving intact almost all insurance-based benefits;
  3. a negative income tax in which benefits would phase out as people earn more money;
  4. miscellaneous other approaches including a universal income and additional components.

Basic in income: Can it work in France?

What would an unconditional basic income in France look like in concrete terms?

A basic income is an income unconditionally granted to all on an individual basis, without means test or work requirement.
Excerpt from basicincome.org

Multiple surveys across many countries show an increasing support for the idea of providing every citizen with a monthly lump-sum allowance to ensure everyone can meet their basic subsistence needs. In France, the IFOP (a leading French national market research institute) has shown that this support goes beyond political orientation divisions. From the question: “Are you in favour of implementing a guaranteed basic income for all citizens which would replace most existing allowances?” came a positive answer, depending on the degree of support for one party or another, from 72% to 79% for left wing sympathizers and from 50% to 54% for right wing sympathizers.

However, what would an unconditional basic income in France look like in concrete terms?

 

The Finland experiment

Since the election in April of the Finnish pro-basic income coalition, the topic has given rise to renewed international interest. All started when the Prime Minister of Finland Juha Sipilä announced the launch of a series of pilots, the most important being a “universal basic income” [1], in order to reform the social security system in response to the evolution of the labour market. This will also allow the evaluation of how to reinforce autonomy and incentives to work, as well as reducing bureaucracy and the complexity inherent in accessing social assistance.

The lead role in this project has been given to professor Olli Kangas (KELA) who has outlined the following schedule[2]: preparation phase from December 5th, 2015 to November 15th, 2016; two-year experimentation starting in 2017; evaluation in 2019.

Olli Kangas explained that the work group will evaluate at least four options:

  1. a “full basic income” (~800 €) replacing almost all basic and insurance-based benefits;
  2. a “partial basic income” (~550 €) replacing all basic benefits but leaving intact almost all insurance-based benefits;
  3. a negative income tax in which benefits would phase out as people earn more money;
  4. miscellaneous other approaches including a universal income and additional components.

Everyone who has recognised the need for major reforms of our social protection mechanisms perceives the announcement of the Finish pilot as an opportunity. However, we need to give time to our Finnish friends for their project to mature.

 

Which options are possible in France?

The Association for the Introduction of an Existence Income (AIRE) has been working on these questions since 1989, gathering studies and proposals from numerous experts, philosophers, economists, sociologists, politicians, etc. The French Movement for a Basic Income (MFRB) created in 2013 involves activists from a wide variety of backgrounds, leading actions through the country and enriching proposals by bringing together citizen experiences from the grass-roots[3].

Despite apparent simplicity, an unconditional basic income would require a series of structural choices. Precise adjustment of the parameters would need to be made in order to ensure it performs optimally in terms of justice and efficiency. Considering the vast number of options, it would be fallacious to believe that there is an ideal solution. Actually several options that must be weighted by parliamentary and experts in order to create a consensus that is adapted to the reality of our country.

Our experience leads us to recommend a universal income that would vary based on the beneficiary’s age. In particular the case for children should be processed separately, which means organizing an in-depth discussion about the French family assistance policy. This means replacing all or part of the actual eight allowances[4] by a lump-sum for each child. A key stake is to eliminate the high variability of the State grants according to the child’s rank within the family, the matrimonial status of the parents or the parent’s income (knowing that a single child of a middle-income level couple currently receives a remarkably low grant). The potential variation of the universal income amount according to child age (3, 14, 18 year old thresholds) must also be further investigated.

Similarly a discussion is needed regarding senior citizens. The question of incentive to work disappears with the elderly, but the dependency issue arises. Do we need to define a higher amount above 65 years old? How should the matrimonial life conditions be integrated? The ASPA[5] level (800 € for a single person, 1242 € for a couple) gives an indication but not a clear answer on the solution to be implemented.

The coordination with housing allowances constitutes a third theme to be carefully analysed. Acknowledging the inflationary effect of housing allowances (APL) on the rental market price, some politicians and economists[6] are investigating the potential effects of merging the APL and the RSA[7]. As the AIRE association is attached to the Tinbergen rule[8], we are highly reluctant to support this proposal, but the underlying issues must nonetheless be addressed. In any case, it is important to revisit conditionality links between several allowances and the housing grant, in particular the existence of a problematic “housing lump-sum” component within the RSA.

The last framing issue is to define the scope of beneficiaries for a “universal income”. Despite this designation, it is necessary to limit eligibility to a national community. This needs to be defined in terms of residence and/or nationality, probably through continuity of the rules applying today for the RSA beneficiaries. However, this still creates a variety of fundamental questions, for example the potential right to the universal income for prisoners or asylum seekers (currently receiving the ATA[9]).

 

Three scenarios for a universal basic income for “active age” adults

Similarly to the Finnish approach, we identify three quite different scenarios to defining a universal basic income that would be paid to any adult in France.

  1. Baseline: extend the distribution of the “RSA single person allowance” to the whole country population (excluding the housing lump-sum component), being 470 € by month in 2016, financed by a flat tax system replacing several current basic social and family allowances as well as tax mechanisms.
  2. Maximised: distribute equally to the whole population the entirety of the social protection budget, including pensions and unemployment benefit. This would mean about 800 € by month.
  3. Dynamic: delete all employment incentives to companies and allowing a massive flexibility improvement in terms of minimum salary, in order to finance a basic income ranging between 500 € and 550 € by month. This would also replace a major part of the social and tax mechanisms but leave intact all insurance-based benefits.

The financial feasibility of scenario A is proven and it does not lead to a large upheaval of the redistribution operating in France. It allows a massive simplification of the social and tax systems, facilitating daily life of the population and reducing operational costs. This scenario, like the following ones, eliminates many inconsistences, iniquities and numerous more-or-less known perverse effects. However in term of micro-economic analysis, it does not imply a massive evolution neither by an income effect nor by a substitution effect, unlike the other scenarios.

Scenario B designates the losers: those who contributed all along their life for pensions and unemployment benefits and who would be left without those related benefits. Neither the AIRE nor the MFRB association support this scenario. Such an approach – if it proves to be meaningful – could be considered only through a very long migration phase from one system to another. This would need to be built cautiously, with the implication of the labour unions. Besides, the high level of the benefit leads to a high income effect, many people being possibly satisfied by this amount without seeking for a complementary paid activity. Thesubstitution effect contributes on the same way, due to the high level of contribution necessary to finance it.

Scenario C is probably the most audacious challenge, by lightening massively legal constrains framing the labour market, leaving it up to individual and collective negotiations. Citizens with better secured economic status are then on a better position to decide whether to accept or not professional opportunity offers, or to create their own activity by minimising their personal and family risks. The micro-economic analysis is more ambiguous, the income effect being stronger than in scenario A and on the contrary the substitution effectencouraging the activity thanks to a higher flexibility of the labour market.

Of course, the consensus that will emerge from a parliamentary work gathering representatives of all parties and the support of experts from diverse fields could finally be a combination of those three scenarios with potential integration of others approaches. In any case, no option presented in this note should be excluded without in-depth investigation.

source