3 April 2024

Suspend or discontinue the salary?

By Seliz Demirci

In the event of occupational disability, an employee is entitled to continued payment of their salary for 104 weeks. During this period, both the employer and the employee have rehabilitation obligations.

The employer must ensure that the employee can return to work.  While the employee must cooperate with a quick and proper rehabilitation process. If an employee who is unfit for work does not cooperate sufficiently with their rehabilitation, the employer has the option of suspending and discontinuing the salary. In practice, there is regularly confusion about which salary sanction should be used. A common misconception is that the choice of the salary sanction is at the discretion of the employer. However, the law stipulates the circumstances under which the employer may suspend, postpone or completely discontinue the salary.

This article discusses the distinction between the two salary sanctions, based on a recent ruling by the subdistrict court.

Suspension of salary

If the employee does not allow the employer to verify whether they are actually unfit for work, the employer is entitled to suspend the salary of the employee. For example, consider the case where the employee fails to attend an appointment with the company doctor. If the employee does comply with an appointment request from the company doctor shortly thereafter, and if the company doctor considers that the employee is unfit for work, the employer must pay his or her salary retrospectively.

Discontinuation of salary

The situation differs if the salary is discontinued. The employee is no longer entitled to a salary that has been discontinued, and it will not be paid retrospectively. The discontinuation of salary is therefore a more drastic measure, and is only allowed in certain cases stipulated by law. For example, where the employee has deliberately caused their own illness, provided incorrect information when they joined the company knowing that they would be unable to perform the job, refused suitable work, or would not cooperate with the Plan of Action.

According to a recent ruling, both salary sanctions should be treated with caution. In that case, the employee had become unfit for work due to an industrial accident. At some point the employer discontinued paying the salary of the employee, with the aim of forcing the employee to contact the employer again and provide them with information about his situation. The employee felt this discontinuation or suspension of salary was unjustified. The Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen, UWV) was of the same opinion. The UWV imposed a ‘salary sanction’ on the employer because it had failed to fulfil its rehabilitation obligations. The employer was consequently obliged to continue to pay salary beyond the 104-week period of occupational disability. The Court ruled that this salary sanction was justified.

Choose the correct salary sanction and inform the employee

The ruling discussed above shows that an unjustified discontinuation or suspension of salary can cost an employer dearly. The UWV may require the employer to continue paying salary beyond the 104-week period. In addition, the discontinuation of salary and the suspension of salary are frequently used interchangeably. It is important that the appropriate salary sanction is applied and communicated to the employee. In this sense, the employer has an information obligation: it must inform the employee without delay if it intends to invoke one of the two salary sanctions. For example, if the term ‘suspension of salary’ has been used when ‘discontinuation of salary’ was meant, the employer can no longer invoke a discontinuation of salary. It is therefore advisable to check carefully whether the appropriate measure has been communicated and applied, because otherwise, you may not suspend or discontinue the salary.

More information

If you have any questions, please do not hesitate to contact us.

This article appeared earlier in Rendement.

Seliz Demirci

Seliz Demirci

Lawyer

Within the Employment & Pension law section, Seliz advises national and international employers and employees on various employment law issues.

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