Collective restructuring agreements

Termination of the employment contract by mutual consent

An employment contract may be terminated in various ways. In addition to unilateral termination (dismissal) by the employer or employee, the parties may also agree to terminate the employment contract by mutual consent. In such a case, both the employer and employee agree on the termination of the employment relationship and on the conditions under which it takes place. This is often preceded by a negotiation process. It is customary to record these conditions in a settlement agreement, also referred to as a termination agreement.

A settlement agreement may regulate – in addition to the termination date of the employment contract – various matters, such as: severance pay (termination compensation), release from work, settlement of a bonus, a (neutral or positive) reference, non-compete clause, non-solicitation clause, a contribution towards legal advice, and the final settlement. It is important that the parties record the agreed terms properly.

Assistance or advice in drafting a collective restructuring agreement?

Do you, as an employer, wish to terminate the employment contract with your employee without involving the subdistrict court or the Employee Insurance Agency (UWV)? This can be achieved by entering into a settlement agreement with the employee. If the agreement is properly drafted, the employee will still be entitled to unemployment benefits thereafter.

Elias van Kampen is a specialist in dismissal law and settlement agreements. For a fixed fee of €295 (excluding VAT)\*, Elias will prepare a tailor-made settlement agreement for you. This ensures that the termination of the employment contract is arranged correctly (in line with the most recent legislation) and that you will not face unexpected issues. In addition, he can advise and assist you in any negotiation process with the employee.

Please contact our Employment Law section on +31 (0)20 664 51 11.

* If negotiations with an employee need to be conducted and/or if the settlement agreement requires adjustments at a later stage, this falls outside the fixed fee for this service. In such cases, an additional fee arrangement can be agreed upon.

Want to have your collective restructuring agreement reviewed?

Have you, as an employee, been offered a settlement agreement by your employer? Do not simply agree to the termination of your employment. It is advisable to have the content of the termination agreement reviewed by an employment lawyer. This ensures that all matters are properly arranged from a legal perspective and that you remain entitled to unemployment benefits after your employment ends. In practice, we frequently encounter cases where employers have not complied with dismissal law requirements and therefore lack a legally valid ground for termination. This may provide grounds to challenge the dismissal or negotiate, for instance, a higher severance payment.

Did you know that it is common practice for employers to reimburse (part of) the legal costs you incur?

Please contact our Employment Law section at +31 (0)20 664 51 11.

Conducting negotiations with the employer to amend the settlement agreement, if necessary, falls outside the fixed fee for this service. In such cases, an additional fee arrangement can be agreed upon.