When Embassy’s enter into an employment contract in the Netherlands

Dutch labor law is applicable not only to employment agreements with Dutch nationals and local staff but, in most cases, also to all employment agreements between embassies in the Netherlands and their employees. It does not matter if the contract explicitly states that the laws of the home country apply. If the employee is working in the Netherlands, Dutch mandatory employment law is in effect. What does this mean in practice?

Termination rules

If an employee has a permanent employment contract, they cannot be dismissed without cause. The employer, in this case, the embassy, must have a legal ground for termination. There are nine valid grounds for dismissal, which include:

– Economic business reasons
– Long-term incapacity for work
– Frequent sickness absence
– Inadequate performance
– Culpable conduct
– Refusal to perform work for reasons of conscience**
– Impaired employment relationship**
– Other circumstances

Case law indicates that the immunity from jurisdiction does not exempt embassies for example from the obligation to obtain a dismissal permit from the Employee Insurance Agency (UWV) when dismissing an employee for economic reasons (Court of Appeal The Hague, April 20, 2021, ECLI:NL:GHDHA:2021:673).

Redeployment and notice period

Before an employee can be dismissed, the embassy must demonstrate that reassignment to another role within the embassy is not possible. When terminating an employment contract, a notice period must also be observed, except in cases of immediate dismissal or termination during the probation period. The statutory notice period depends on the length of employment, as follows:

• Less than 5 years: 1 month notice;
• 5 to 10 years: 2 months’ notice;
• 10 to 15 years: 3 months’ notice;
• More than 15 years: 4 months’ notice.

If the embassy decides to dismiss an employee, several options are available:

– With permission from the UWV for economic business reasons or long-term incapacity for work;

– By submitting a request for termination to the subdistrict court for any of the other reasons.

The embassy may also present the employee with a settlement agreement to mutually terminate the employment contract, which is often preferred over pursuing a procedure through the UWV or the subdistrict court.

More information

If you have further questions about Dutch labor law as it pertains to foreign embassies or need assistance drafting a settlement agreement to conclude an employment contract, feel free to contact GMW.