Dismissal for poor performance: your rights as an employee
Your employer believes you are not performing well and is threatening to terminate your employment. Perhaps a performance improvement plan has been initiated, perhaps you have received a settlement agreement, or perhaps this is the first time you’ve heard this, even though you’ve always received good performance reviews. In this article, you’ll learn what your rights are, when termination for poor performance is and isn’t permitted, and how you can defend yourself.
Under what circumstances can your employer terminate your employment due to poor performance?
The legal basis for dismissal due to poor performance is set forth in Article 7:669(3)(d) of the Dutch Civil Code. In order to dismiss you, your employer must meet five cumulative requirements:
Proving unsuitability. Your employer must be able to substantiate, with specific evidence, that you are unsuitable for performing your job. Vague dissatisfaction is not enough. This must be demonstrated through performance reports, evaluations, or other written documents. Specific examples are important.
Given timely notice. You must be aware that your employer believes you are not performing adequately and that this could lead to the termination of your employment contract if your performance does not improve. An employer who has never explicitly communicated this and suddenly terminates your employment is in trouble.
Sufficient opportunity for improvement. You must have gone through a genuine improvement process in which you were given a fair chance to improve your performance. This is the point at which most requests for termination are rejected.
No connection to illness or working conditions. The poor performance must not be the result of illness, poor working conditions, or insufficient training provided by the employer.
The possibility of reassignment was explored. The employer must have considered whether another suitable position was available within the organization.
In practice, requests for termination due to poor performance are regularly (in fact, in about 70% of cases) rejected by the labor court because employers fail to meet all of these requirements. It is not easy for an employer to build a case that will withstand judicial scrutiny.
The improvement process: what can you expect?
An improvement plan is a period during which you are given the opportunity to improve your performance. While the law does not prescribe a fixed duration or format, case law does establish clear requirements. A sound improvement plan must meet the following conditions:
Specific and measurable areas for improvement. Vague criticism such as “you need to be more proactive” or “your communication needs to improve” is insufficient. Your employer must clearly describe, using specific examples, exactly what needs to be improved, what specific goals you need to achieve, and by when.
Support from the employer. This may include coaching, additional training, a mentor, or adjustments to your job duties. The employer cannot simply set requirements without providing you with the resources to meet them.
Mid-process evaluations. An employer who waits until the very end of the process to provide a final assessment hasn’t handled things properly. You need to know where you stand along the way.
A reasonable period of time. This will depend on the nature of the alleged misconduct and the complexity of the case. It is also generally true that the longer you have been employed, the more your employer can be expected to accommodate you. In cases of long-term employment, a period of six months or more is not uncommon.
Consequences must be specified in advance. The employer must make it clear in advance what will happen if you fail to meet your goals. This usually involves a warning that dismissal may follow.
A remediation plan designed to fail will be seen through by the court. If the goals are unachievable, the timeline is unreasonably short, or there is a lack of support, this will work in your favor in the event of legal proceedings.
How to defend yourself
Submit a written objection. If you disagree with the criticism of your performance or the feedback provided during performance reviews, always make your disagreement known in writing. Do not sign a performance or evaluation report without indicating that you disagree with its content. A note such as “acknowledged, but not agreed with,” accompanied by an explanation, is not uncommon.
Gather evidence to the contrary. Positive emails from clients or colleagues, targets you’ve met, good past performance reviews—in short, anything that shows you are performing well or have performed well in the past is relevant. Keep this evidence safe. It is also advisable
Please cooperate with the improvement process. Even if you believe the criticism is unjustified, it is important to adopt a cooperative attitude. An employee who refuses to cooperate weakens their own position. This could lead to the termination of the employment contract. Be open-minded, but remain critical of the content and reasonableness of the goals set.
Seek legal assistance as soon as possible. The sooner you do this, the better your position can be protected. An employment lawyer can assess whether the improvement plan meets legal requirements, advise you on your strategy, and, if necessary, communicate with your employer on your behalf.
The settlement agreement as an alternative
In practice, when an employee is suspected of poor performance, employers often first offer a settlement agreement. The employer then attempts to reach a mutually agreed termination without having to go through the uncertainty of a small claims court proceeding. It is not uncommon for this to be offered as an alternative even before the performance improvement process begins.
This presents opportunities. If your employer’s case isn’t strong enough to win a lawsuit, you can usually negotiate a more favorable settlement during VSO negotiations than the statutory transition payment. This could include a higher severance package, time off from work, an outplacement budget, or the waiver of a non-compete clause.
Don’t sign right away. The initial offer is almost always the starting point of a negotiation, not the end point. Have the employment contract reviewed by an employment lawyer before you respond.
Transition compensation and fair compensation
If the subdistrict court terminates your employment contract due to poor performance, you are generally entitled to a transition payment. This amounts to one-third of your gross monthly salary for each year of service.
In exceptional cases, the court may also award equitable compensation if the employer has acted in a seriously culpable manner. This may be the case if the employer used the improvement process as a pretext for a dismissal decision that had already been made, if the employer disrupted the employment relationship through its own actions, or if the employer fabricated the grounds for dismissal. The amount of the equitable compensation is not legally standardized and depends on the circumstances.
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Schedule a free consultation →Frequently Asked Questions
Generally speaking, no. The labor court requires that the employer has given you sufficient opportunity to improve your performance. Without a proper performance improvement plan, a request to terminate the employment contract on grounds of poor performance is almost always denied. Only in exceptional cases—such as serious incidents—can a performance improvement plan be waived.
Yes, that’s wise. An employee who refuses to cooperate with a performance improvement plan weakens their own position. A judge could interpret this as a lack of willingness to improve, which works to the employee’s disadvantage. Cooperate, but be critical of the reasonableness of the goals and the support provided.
The law does not prescribe a fixed timeframe. Case law indicates that the duration must be reasonable in relation to the length of employment and the nature of the poor performance. For a short period of employment, two to three months may be sufficient. For a long period of employment, a longer process is expected, sometimes six months or more.
Yes. If your employment contract is terminated due to poor performance, you are entitled to a transition payment equal to one-third of your gross monthly salary for each year of service. If your employer has acted in a seriously culpable manner, the court may also award fair compensation. In the case of a settlement agreement, the compensation is negotiable and is often higher than the statutory minimum.
This significantly strengthens your position. An employer who suddenly accuses an employee with years of positive performance reviews of poor performance will have to convince the court that there is a genuine and structural problem. Previous positive performance reviews serve as a strong defense. The labor court judge will scrutinize the evidence supporting the alleged poor performance even more closely.
If the poor performance is due to illness, poor working conditions, or insufficient training, the employer may not terminate your employment on those grounds. In such cases, the employer must first address the underlying cause. This is a common defense that is taken seriously by the court.
In cases of poor performance, suspension or placement on leave is not legally required and is often not justified. Yet it happens in practice. If you are wrongfully suspended, you can file an objection and, if necessary, initiate summary proceedings to be reinstated. Your right to pay remains in effect in all cases.
