The silver lining of the end of a fixed-term employment contract: Read this to make some extra money!

Robert M. Berendsen from Mr. Berendsen Advocaten tells you how to earn a few more euros before leaving your employer for good.

Your fixed-term labour contract ends on a specific date. When your employer has notified you that they do not intend to renew your contract, you may despair or perhaps breathe a sigh of relief. Whichever is the case, do read on, as you might actually be entitled to some extra money!

(In case your fixed-term contract is renewed, the renewal may qualify as an indefinite-term contract, even if the wording suggests otherwise. But that subject is out of scope for this article.)

Transition payment

(Nearly) everyone who loses their job involuntarily in this country has the right to a transition payment. This payment is intended to compensate for the loss of seniority and to ease over the transition to a new job, irrespective of whether you succeed in finding a new job immediately and irrespective of whether you qualify for unemployment benefits.

Don’t rejoice too fast: it’s a meagre one-third of a month's salary per year worked (calculated in fractions of days).

Notice payment

Even though a fixed-term labour contract ends without the need to give written notice in the sense that no one needs to express their wish to not renew it, the law prescribes that the employer must warn the employee of the fact that the contract will end by operation of law at least one month prior to the end. There is, thus, a difference between giving notice and notifying an employee.

Some employers choose to incorporate the notification in the labour contract. Although acceptable under the law, it appears senseless to us: the purpose of the notification is to remind the employee.

The same law prescribes that the employer who wishes to renew the contract must inform their employee at least one month before the renewal date about that wish and the conditions under which the contract will be renewed. If the employer fails to notify the employee (in time), they have a right to compensation in the form of a notice payment of up to one month of their normal salary.

If the employer does give a notice, but only two weeks before the end date, the employee qualifies for (roughly) half a month’s salary. The calculation of these compensations is regulated by law. Monthly salary is defined (again roughly) as your yearly income from work, including normal bonuses and holiday allowances, divided by 12.

Anything else?

Well, at the end of your contract, you may qualify for outstanding holiday allowance and the payment of unused holidays.

Don’t wait too long

The payments discussed in this article have a very short shelf life under Dutch law. If you do not take legal action within two months after the end of your labour agreement, your rights are lost. First, try to convince your employer to pay up. Explain that you can’t wait too long because you risk losing your rights. Your employer will understand if they are rational. If not, call a solicitor!

Mr. Berendsen Advocaten has been working with expats for many years. They specialise in labour law and rental law and cater to English, French and Spanish-speaking expats. They do not only work for the highly paid expats; they also do pro bono work for people with lower incomes. Their firm is one of the rare law firms to offer income-based discounts to people who earn too much for subsidised legal aid, but too little to be able to afford regular fees.