Transition Compensation
The legal transition compensation has been around for more than 8 years. It is a severance payment to which employees are entitled from the first day of employment. The transition compensation is simple to calculate: 1/3rd monthly salary per year worked. So if someone has worked for 6 years, they are entitled to two gross monthly salaries, including vacation allowance and other emoluments.
When entitled to transition pay
Employees are entitled to transition compensation under the law if the employer initiates the termination of the employment contract. Consider the following situations:
- dismissal during the probationary period
- failure to renew a temporary employment contract
- termination of employment contract after two years of illness or due to reorganization
- external redeployment after a reorganization
- dissolution of employment contract for dysfunction
- if the termination of the employment contract is the result of serious culpability on the part of the employer.
Even summary dismissal sometimes entitles the employee to a transitional compensation. The main rule is that in case of serious culpable acts or omissions by the employee there is no right to a transitional compensation, but in case of summary dismissal this is not always the case. Consider an addicted employee who has done something very bad due to his addiction, but cannot be seriously blamed for this due to his addiction.
This blog was written by Mr. Stijn Blom, employment lawyer at Arbeidsadvocaat.nl B.V. Stijn has extensive experience in employment law and assists entrepreneurs daily with a wide range of employment-related matters. From dismissal cases to drafting watertight contracts and policies – with his practical and personal approach, he helps employers and employees move forward. Want to know more?Visit Stijn's page.
Arbeidsadvocaat.nl is happy to think with you if you have any questions about the transition compensation. Please feel free to contact us.
June 2024
