The perfect settlement agreement; 7 tips for employers when entering into a settlement agreement


The perfect settlement agreement; 7 tips for employers when entering into a settlement agreement lawyer Amsterdam
What should you pay attention to when an employer wants to legally say goodbye to one of its employees? Lawyer employment law Amsterdam gives advice. The most common method is to do this in consultation with the employee by entering into a settlement agreement or termination agreement (VSO). This method of amicable dismissal in The Netherlands is possible both if there are business economic reasons, such as a reduced work supply, or if there are personal reasons not to continue with this employee. As an employer, you can take the following steps to say goodbye to an employee via a settlement agreement.

Preparation settlement agreement in The Netherlands

1. Preparation: Take time to evaluate the situation and determine the neutral reasons for dismissal. Make sure you have a good justification for terminating the employment contract and explain that as clearly as possible to the employee. Also consider the terms and compensation you are willing to offer. You can think of a severance payment, such as the legal transition compensation, but also, for example, a later termination date in which the employee is released from work. It is customary to continue to pay the employee until the end date.

Discuss the VSO with the employee

2. Discuss it with the employee: Schedule a personal meeting with the employee to explain the situation and suggest the possibility of termination through a settlement agreement. Be clear and respectful during communication. Just sending something is not always helpful.

Negotiating a Dutch settlement agreement

3. Negotiation: Put conditions and compensations such as severance pay on the table and engage with the employee to come to a mutually acceptable agreement. Be prepared to compromise with the employee or his attorney and possibly negotiate certain parts of the severance agreement.

Legal review of the settlement agreement

4. Legal review: Have the settlement agreement reviewed in advance by an employment lawyer in Amsterdam to ensure that it meets all legal requirements and protects the interests of both parties. This is especially important if, for example, the employee has a non-compete clause in the current employment contract. But there may also be risks if, for example, the contract is for a fixed term, or if the employee is sick. Also consider components such as the confidentiality clause, what happens if the employee gets sick, and how the non-competition clause is handled.

Written agreement

5. Written Agreement: Once both parties agree and any adjustments have been made, put the settlement agreement in writing permanently. Make sure all relevant details, such as the termination date, end date, any compensation and other terms are clearly stated. It is also a good idea to immediately check whether the agreement meets all the conditions set by the UWV when awarding unemployment benefits.

Statutory reflection period for a settlement agreement

6. Reflection period: Keep in mind that employees legally have fourteen days to consider a settlement agreement. During this period, the employee can still seek legal advice and assess whether to agree to the agreement. If there is no such clause, and then the employee has even three weeks to renounce the agreement.

Final termination of the employment contract

7. Dissolution of the employment contract: If the employee agrees to the settlement agreement after the reflection period, the employment contract can be terminated as mutually agreed upon. Make sure the employee signs the necessary documents to make the agreement final. Lay down that once this agreement is signed, the parties cannot go back on it afterwards with a claim.

It is important to understand that a settlement agreement is a legally binding document. It is always wise to negotiate the terms to ensure that they are 100 percent acceptable to you. Therefore, it is always advisable to seek legal advice and work with an employment law attorney in Amsterdam.

Contact attorney employment law Amsterdam about entering into a settlement agreement

Looking for commitment and direct, personal contact with an experienced labor law specialist in Amsterdam? Call our specialized employment law and dismissal lawyers for questions and legal advice on employment law, such as entering into a settlement agreement.


Call our employment lawyers: 0031 20 – 522 1999 



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