Termination of employment contract during illness

Dutch employment law protects the sick employee to a high degree. GMW lawyers set out below how far this protection reaches.

Continued payment of wages during illness

The employer is obliged to continue to pay (part of) the salary of the sick employee for two years. During that period, the employer cannot terminate the employment contract: a prohibition of termination applies. The prohibition of termination during illness also applies if the employee is partly able to carry out the work. Only when he is able again to carry out his work in full is the prohibition no longer applicable. Setting aside the employment contract of a sick employee is however often possible.

When does a prohibition of termination during illness apply?

The prohibition of termination during illness applies in principle during the first two years the employee is incapacitated for work. If periods of incapacity follow each other with intervals of less than four weeks, these are added together to determine the total term of the illness.

The period of two years can be extended. This is the case if the UWV extends the obligation to continue to pay wages. This could occur if the employer has not complied with the reintegration obligations.

Dismissal for commercial reasons not possible

The consequences of the prohibition of termination during illness are greatest in the event of commercial dismissal: commercial dismissal via UWV (termination) or the sub-district court (setting aside) is not possible. If it was the sick employee who was eligible for being made redundant on the basis of the proportionality principle, the employer must nominate the next employee on the list for redundancy. The sick employee is protected. The exception is dismissal for commercial reason due to general business cessation. And this prohibition does not apply if the employee has become incapacitated for work after the employer has submitted an application for dismissal to the UWV.

Is it nevertheless possible to terminate the employment contract?

The employment contract with a sick employee can under certain conditions still be terminated. Firstly, this is possible if the employer and employee reach agreement on the termination of the employment contract. This could however have consequences for the sick employee relating to benefits and the employer can on the termination of the employment contract with a sick employee be faced with premium consequences.

In addition, there are a number of exceptions to the prohibition of termination during illness. The prohibition does not apply if the reason for the termination is not the illness and one of the following situations occur:

  • Termination during the probationary period;
  • There is an urgent reason (instant dismissal);
  • The employee has reached the state pension age.

Setting aside the employment contract

Finally, the employer can apply to the sub-district court to set aside the employment contract with the sick employee. The employer can request the sub-district court to set aside the employment contract with a sick employee for a different reason than illness and – therefore – for other reasons than commercial reasons. This could include setting aside due to a damaged working relationship with a sick employee, or due to unsatisfactory performance – provided the application for dismissal does not relate to the incapacity for work of the employee. The prohibition of termination does also not apply, and the employer can apply for a setting aside of the employment contract, if a sick employee refuses to cooperate in his reintegration.

Further information

Do you have questions about this topic or do you wish to discuss a case? Please contact our employment law team for assistance.

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