The Work and Security Act – What's in it for you?

The first part of the Work and Security Act will come into effect on 1 January 2015. The law aims to strengthen the position of employees with a fixed-term employment contract. In addition, dismissal law will be drastically changed on 1 July 2015. Are you ready for what is coming? In this column, I will briefly explain the changes. As of 1 January 2015, the possibility of excluding the obligation to pay wages if the employee does not perform work as a result of a cause that lies within the employer's sphere of risk will be limited. In addition, the possibility of agreeing on a trial period will be limited, it will be prohibited to include a non-competition clause in a fixed-term employment contract (unless its importance is substantiated) and the notice period will be introduced, so that you must inform the employee at least one month before the end of the employment contract about a possible continuation, on penalty of compensation. In practice, it appears that most employers already indicate whether the contract will be continued by operation of law after the end or not. Now it is a matter of paying attention to the right timing. I expect that the first changes will be implemented without major problems. The adjusted chain regulation will apply as of 1 July 2015 to all employment contracts that commence on or after 1 July 2015. This is where the puzzle with temporary contracts really begins. The number of employment contracts in the chain will remain three, but the duration of the chain will be shortened to two years. The chain is only broken after a period of more than six months. Pay close attention to this, because even if the last employment contract ended before 1 July 2015, there must be an interruption of more than six months. If this is not the case, the chain will continue. This means that there will sooner be an employment contract for an indefinite period. Formulated the other way around: employees will not stay with an employer for three, but two years if that employer does not want to enter into an indefinite-term contract. The question is whether this will achieve the desired effect. Less attention has been paid to the training requirement, which will also come into effect as of 1 July 2015. The employer is required to provide the employee with training that is necessary for the performance of his/her own function or another function if working in his/her own function is not possible for whatever reason. The article does not provide for a sanction, but you can assume that the employee will have an additional argument in a procedure if the training obligation has not been fulfilled. The greatest consequence of the law is the amendment of the dismissal law. The Minister wanted to make dismissal simpler and cheaper. That is why all grounds for dismissal have been included in the law. It is not possible to combine grounds for dismissal. Termination will not be pronounced if the UWV or the subdistrict court determines that the grounds for dismissal have not been demonstrated, or have not been sufficiently demonstrated. It is expected that this will happen more quickly, partly because the judge's discretionary power is restricted. In addition, the employer must demonstrate that redeployment within the organisation is not possible, not even with the help of training. This makes it very important that you keep a good file. In the event of termination of the employment contract at the initiative of the employer, a transition payment is due if the employment contract has lasted longer than two years. This obligation applies regardless of the reason for termination. If the employee has reached retirement age, if the employee has acted seriously culpably, or if the employee terminates the employment contract himself, the transition payment is not due. The Law and Security Act may not make things any easier for employers. It will be a case of making do with what is available, but there is certainly power if you take up the changes and implement them in a practical manner in your Human Resource Management. This column was written by Tjeerd Hoekstra, lawyer in the employment law practice group at CMS Derks Star Busmann. He specialises in individual and collective employment law, codetermination law, reorganisations and dismissal of statutory directors. For more information, please contact Andreas Meijer, manager of legal and federal affairs at FHI; a.meijer@fhi.nl; tel.: 033 465 75 07. Click here for 'The new dismissal law; practical tips'.