News

1. Retirement dismissal

Unless it has a been otherwise agreed upon in writing (individually or collectively), under the Employment and Social Security Act (WWZ), effective 1 July 2015, the employer can terminate an employee´s employment contract prior to or after the day on which the employee acquires the right to retirement benefits under the AOW (state pension) or on the basis of a different pension scheme (article 7:669 sub 4 Dutch Civil Code, DCC)
Consent of the employee, requesting the UWV (the Employee Insurance Administration) to grant a dismissal permit, or going to the district court is not necessary. It does have to be an employment contract entered into prior to reaching the AOW (state pension) – or statutory retirement age.

Also when the employee should keep working for a time after reaching the AOW – or retirement age, the employer can terminate the contract without the employee´s consent at any given time.

2. Retirement dismissal clause

It is also still possible to mutually agree to include a retirement dismissal clause in the employment contract. On the basis of this clause, the employment will end by law on reaching the AOW – or retirement age.
When the employee then keeps working, a new employment contract applies. In that case, applying the retirement dismissal under article 7:669 sub 4 DCC is no longer possible. After all, the employment contract has not been entered into before the AOW – or retirement age. As a result, this employee then enjoys the normal employment protection.

3. Include a retirement dismissal clause or not?

Not to include a retirement dismissal clause in the employment contract yields the greatest flexibility because the retirement dismissal can then be granted at any moment prior to or after the day the employee gets the right to retirement benefits based on the AOW (social security) or a different pension scheme.

4. Transitional allowance

When the employment contract ends when reaching the retirement age, no transitional allowance is owed (article 7:673 sub 7 under b DCC).

5. Dismissal prohibitions

Most of the dismissal prohibitions based on article 7:670a sub 2 under e DCC, among them illness and membership of or application for the Works Council, do not apply to the retirement dismissal. It is, however, conditional upon the dismissal not relating to the circumstances that apply to the dismissal prohibitions.