Welcome to the new edition of the Employment Update of Baker McKenzie Amsterdam's Employment & Compensation Practice.

With this digital newsletter, we will keep you up to date with the current developments in the field of Employment law that may be of interest for your practice.

If you would like to find out more about this newsletter, please do not hesitate to contact us.

Suspension of enforcement of the DBA Act is extended until 1 January 2020

The suspension of the enforcement of the Dutch Deregulation Labour Relations Assessment Act (in Dutch: 'Wet deregulering beoordeling arbeidsrelaties' is extended until 1 January 2020. This means that clients and contractors will not receive any penalties or additional tax assessments if it turns out in retrospect that there is an employment relationship. However, the government will expand the possibilities for enforcing malicious persons as from 1 July 2018.

Extension of works council powers regarding the remuneration of directors

On 23 January 2018, the House of Representatives passed a bill amending the Works Councils Act. The adopted bill provides for an extension of the powers of works councils regarding the remuneration of directors and other employees within the company. This applies to companies with more than 100 employees. The bill provides that the entrepreneur must discuss the remuneration policies and financial arrangements with the works council during a consultative meeting (in addition to the current obligation to provide such information in writing only). With the extension of the works council's powers it is intended is to stimulate the director to account for his remuneration policy and any differences in the remuneration ratios between several groups of employees (including the board of directors).

Sharing trade secrets is unlawful

A former employee has copied the employer's database and handed it over to third parties. Employer in this case is an employment agency and the shared trade secrets concern the data of personnel. The damage consists of the fact that the trade secrets have come into the hands of third parties and the loss of turnover of the employer because its workforce of active personnel has dropped. The (former) employee and the third parties are jointly and severally ordered to pay compensation for the damage suffered by the employer. The exact damages will be determined in a follow-up proceedings for the determination of damages. It is left undecided whether the (former) employee has also failed in his obligation under the employment contract.

Maximization scheme in social plan of severance payment in case of early retirement

The severance payment of an older employee who can retire early during a reorganization is reduced to such an extend based on the social plan, that only a small amount remains. To illustrate, if the employee would have been entitled to the "regular" - thus not subject to a maximum - amount of severance payment based on the social plan he could claim € 164,499, - but since he retired early during the reorganization, the severance payment on the basis of the social plan is capped at € 17.135, -. In this ruling, the court considered whether the maximization scheme results in age discrimination. Given that court considers that the clause does indeed make a distinction based on age, the question arises whether or not it concerns a distinction that is permissible. For that to be the case, there must be a legitimate aim, and the means used to achieve that aim must be both appropriate and necessary. According to the court, there is no question of the latter, and therefore the clause regarding the maximization of the severance payment due to early retirement in the social plan is void.

Employer is obliged to pay compensation since notification letter has not been handed over

Employer has informed the employee in writing regarding not extending the employment agreement which ended by operation of law. Although, this notification letter was signed by the employee, it was never handed over. The purpose of informing the employee in writing is that the employee has a written statement of the employer regarding the termination of the employment. The sub district court obliged the employer to pay compensation equal to one month salary due to non-compliance with the notification obligation.


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