Takeover, dismissal & reorganisation

Labour law consequences of collective dismissal or takeover due to reorganisation have a substantial impact on employment contracts between employers and employees. Employment contracts may end or be transferred. In all cases, the employer must be able to explain the decision and provide for the consequences for employees, for example, by means of a Social Plan (agreed with the trade unions).

There may also be reasons beyond economic or organisational circumstances for terminating an individual employee. For example, if an employee has been ill for a long time, has acted culpably, or does not perform well, or if mutual relationships have been seriously disrupted.

In addition, there may be urgent grounds for instant dismissal, as a result of which the employment contract must be terminated immediately. Also in such an individual case, the employer must be able to explain why the employee in question is dismissed, and there must be a final settlement.

Corporate takeover

No other subject has been dealt with so often by the European Court as the transfer of undertaking. That shows how complex the matter is.

In the event of the transfer of an undertaking or an independent part thereof, the active workforce is transferred to the acquiring party by operation of law.

Answers to your questions

Our specialists can help you answer the following questions:

  • What constitutes a transfer of undertaking?
  • What are the consequences and risks of a transfer of undertaking?
  • What if an employer only takes on a limited number of employees? Dose that also constitute a transfer of undertaking?
  • Is it possible to depart from the legal provisions and exclude the transfer of employees?
  • Can the employment conditions of the transferred employees be harmonised with the existing employment conditions?
  • What about the applicable collective labour agreement(s)?
  • May an employee refuse to transfer to the acquiring party? If yes, what are then the legal consequences?

Dismissal

Dismissal law has not become any simpler since the introduction of the Work and Security Act in 2015.

The grounds for dismissal are exhaustively listed in the above-mentioned Act and an employer must fully substantiate the grounds for dismissal; it is all or nothing. In some cases, the employer must go to the Employee Insurance Agency (UWV) for a termination permit, while in other cases, the employer’s only recourse is to the subdistrict court.

In the event that the employee cannot be seriously blamed, the employer will have to pay transitional compensation. An employee who believes that their employer is seriously at fault may ask the court for equitable compensation.

Do you need advice or guidance?

Our employment lawyers provide advice and assistance in individual dismissal cases. They can assess whether the case file is sufficient for dismissal and what, if anything, can still be done to complete the file. They can also help you with negotiating an individual dismissal agreement.

Reorganisation and restructuring

When faced with the wish or necessity to reorganise, one does not always know what aspects have to be taken into consideration. Which institutions are involved? How much time will it take?

Numerous rules and obligations

If reorganisation takes place at the expense of jobs, a wide range of rules and obligations apply. For example, the Works Councils Act imposes an obligation to consult the works council in the event of major changes, and, if twenty or more jobs are going to be lost, the Collective Redundancy (Notification) Act must be complied with.

A CAO may impose obligations to seek consultation. And there may also exist an obligation to draw up a social plan together with the trade unions or the works council. Each dismissal is assessed individually by the UWV, and the employer must therefore meet the strict obligations imposed by law and regulations (such as the Implementation Rules for Dismissal).

Want to know more?

Our corporate and employment lawyers have many years of experience in this field. They can help you prepare and execute an individual or collective dismissal, or a company acquisition.

Do you need advice? Do you have questions? Or would you like more information? Please feel free to contact us. We will be happy to help you.