Have you received a settlement agreement?

A settlement agreement (VSO) is an agreement by which an employer and an employee terminate the employment relationship by mutual consent. It is a legally binding document that sets forth agreements regarding, among other things, the termination date, severance pay, notice period, and any other terms and conditions. In practice, the terms “settlement agreement” and “termination agreement” are often used interchangeably.

This is highly recommended. By signing a VSO, you waive important rights, including protection against dismissal. Errors in the wording could result in you receiving no unemployment benefits or receiving them too late, your severance pay being too low, or a non-compete clause remaining in effect unnecessarily. Our 35-point checklist ensures you don’t sign anything you’ll later regret.

The 35-point review is a legal review conducted by an employment law attorney to examine the contents of your settlement agreement. Among other things, we verify whether the settlement agreement complies with unemployment insurance (WW) regulations, whether the severance pay is reasonable, whether the notice period is correct, whether the clauses are properly worded, and whether there are any pitfalls. You will receive a clear report outlining specific points to consider and areas for improvement.

In more than 95% of cases, yes. Most settlement agreements include a provision stating that the employer will contribute to the costs of legal advice. If such a cost reimbursement is not included in the proposal, you can request it. Employers almost always agree to this, because it’s in their best interest for you to sign the agreement with full knowledge of the facts.

“Lawyer” (or attorney) is a protected title. Lawyers are required to complete mandatory training and continuing education, are subject to disciplinary rules, and are bound by a legal duty of confidentiality. In addition, liability insurance is required, and only an attorney may represent you in all proceedings, including appeals. With a general legal advisor, you don’t have those safeguards, even though the costs are often comparable. Sometimes a legal advisor is unable or unwilling to go to court or UWV, which can be detrimental to your negotiating position.

No. A settlement agreement is based on voluntary consent. Without your signature, the employer cannot terminate the employment contract in this way. If you do not sign, the employer must initiate a dismissal procedure through the UWV or the subdistrict court. That takes time and money, and the outcome is uncertain. So you have leverage in the negotiations.

In the case of termination by mutual agreement, the transition payment is not automatically required by law. In practice, however, a payment is almost always included in the termination agreement, usually at least equal to the statutory transition payment. Depending on the circumstances—such as the reason for termination, whether your employer has a “record” of past issues, your years of service, and the employer’s financial position—there is often room for a higher payment.

Yes, provided the VSO has been drafted correctly. Among other things, it is important that the initiative to terminate the employment relationship lies with the employer, that a neutral ground for termination is included, and that the notice period is correctly reflected in the termination date. Errors in these areas could result in the UWV refusing or delaying your unemployment benefits. That is precisely why a legal review is so important.

After signing, you, as an employee, have a 14-day cooling-off period. Within that period, you may revoke your decision in writing, without giving a reason. If your employer has not informed you in writing of this cooling-off period, the period is extended to 21 days. If you revoke your acceptance within the cooling-off period, the agreement is void and your employment contract remains in effect.

Yes, virtually all settlement agreements are negotiable. Consider the initial proposal as a starting point. Common points of negotiation include a higher severance payment, a more favorable termination date, exemption from work, a positive reference, or the removal of a non-compete clause. You’re in a fairly strong position because the employer needs your consent. In the vast majority of cases, we achieve a better outcome than the initial offer.

In principle, a non-compete clause remains in effect even if you leave via a VSO, unless you make other arrangements. It’s wise to explicitly state in the VSO what happens to the clause. Many employers are willing to waive or relax the non-compete clause in the event of termination by mutual agreement. If the VSO does not address this, you should assume that the original clause remains in effect.

That is generally not recommended. In many cases, a prohibition on termination applies during the first two years of illness. If you leave your job due to illness, you are generally not entitled to sick leave benefits or unemployment benefits, because you are not available for the labor market. You then risk being left without an income. It’s often wiser to wait to sign a voluntary resignation agreement until you’ve (almost) recovered, or to make special arrangements that protect your income.

Unused vacation days and accrued vacation pay are generally paid out at the end of your employment. The VSO usually specifies how many vacation days you have remaining and that these will be paid out with your final paycheck. The same applies to other outstanding entitlements, such as a bonus or overtime pay. It is important that this be clearly stipulated in the agreement.

Final discharge means that, once the VSO has been implemented, neither the employer nor the employee can make any further claims against the other. This signifies that both parties agree that all outstanding rights and obligations have been settled. Make sure that all claims you wish to secure are explicitly included before signing, because once final discharge has been granted, you can no longer revisit them.

If you do not agree, your employment will continue as usual. The employer will then have to take a different course of action, such as initiating dismissal proceedings with the UWV or the subdistrict court. This costs the employer time and money, and the outcome is uncertain. On the other hand, the (financial) outcome may be less favorable. Refusing to sign may also prompt the employer to come up with a better offer. So you won’t lose your job immediately if you don’t sign.

Negotiating on your own carries risks. You often lack legal knowledge, an understanding of what is in line with market standards, and bargaining power. An employment law attorney knows exactly what to look out for and how employers think. This allows you to get the most out of your settlement and avoid mistakes that could jeopardize your unemployment benefits or rights. Furthermore, the costs are almost always reimbursed by the employer.