{"id":30499,"date":"2020-08-12T15:35:15","date_gmt":"2020-08-12T15:35:15","guid":{"rendered":"https:\/\/thelegalcompany.nl\/?p=30499"},"modified":"2026-09-02T17:27:40","modified_gmt":"2026-09-02T17:27:40","slug":"dismissing-an-employee-in-2020-has-not-become-easier","status":"publish","type":"post","link":"https:\/\/thelegalcompany.nl\/en\/dismissing-an-employee-in-2020-has-not-become-easier\/","title":{"rendered":"Dismissing an employee in 2020 has not become easier"},"content":{"rendered":"\n

Economic dismissal and dismissal on personal grounds (the i-ground) of a permanent employee has not become easier in 2020. This is due to the NOW dismissal penalty, the extra test applied by the UWV because of the coronavirus, and the new i-ground for dismissal that has applied since 1 January 2020.<\/strong><\/span><\/p>\n

If you want to dismiss employees, you can only do so for a good reason. The law refers to a so-called “reasonable ground” for dismissal. The law sets out exactly which reasonable grounds exist. Broadly speaking, there are three categories: economic dismissal, long-term illness, or personal grounds. Economic dismissal has unfortunately become highly topical again after a number of good years, due to the economic downturn caused by the coronavirus. Unfortunately, economic dismissal has not become easier due to the NOW dismissal penalty and the tightened UWV test surrounding the NOW scheme. Below, therefore, are the key points to consider regarding economic dismissal in times of coronavirus. In addition, dismissal on personal grounds, such as underperformance, was supposed to be made easier in 2020 through the introduction of the i-ground. Case law so far shows that this is not yet entirely the case. But there is light on the horizon. This is discussed in the second part of this article.<\/span><\/p>\n

Tightening of economic dismissal.

<\/strong><\/span><\/h5>\n

The first ground for dismissal is highly topical again right now. This is reorganisation due to economic circumstances (economic dismissal). Think here of reduced work and structural decline in revenue caused by the coronavirus. The economy will shrink considerably this year, and recovery is not expected until next year. Most companies notice that the number of assignments\/orders\/etc. has (structurally) declined and may therefore have to adjust their workforce accordingly. Employers can then choose to cut jobs. The procedure for economic dismissal goes via the UWV. Only once an employer has permission from the UWV can the employee’s contract be terminated.<\/span><\/p>\n

Is the decline in revenue structural?<\/strong><\/span>
<\/u>To obtain permission, the entrepreneur must demonstrate that the worse circumstances will persist for at least six months. That is probably not such a difficult point at this time, but it will also depend heavily on the sector in which the company operates. The question of whether the decline in revenue will be structural also relates to government measures and government support. At the moment, the measures are indeed being relaxed considerably, but this could also be reversed. We are currently seeing this happen in some areas of Belgium. In the event of a local coronavirus outbreak, or even a second nationwide wave, government policy could change from one day to the next. Can and should an employer already anticipate this now? In a dismissal application, the entrepreneur will have to make it plausible to the UWV that this is not merely a temporary decline in work or revenue solely because of the coronavirus measures. After all, those measures are, in principle, becoming ever more relaxed. Employers are expected to absorb a temporary downturn themselves. All in all, this can therefore sometimes still be a difficult point to demonstrate.<\/span><\/p>\n

Have all possible cost-saving measures been taken?<\/strong><\/span>
<\/u>Another difficult point that must be demonstrated is whether the company has taken all other possible measures to prevent dismissal. For example, an entrepreneur can also apply again for NOW support to cover the wage costs for June, July, August and September 2020. This is possible if revenue for these months is again expected to fall by 20% or more compared to 2019.<\/span><\/p>\n

NOW or reorganisation.<\/strong><\/span>
<\/u>Entrepreneurs are, however, not obliged to apply for NOW subsidy. It is therefore free to choose not to make use of the NOW, and to reorganise instead. However, when assessing the dismissal application, the UWV will always look at other measures the employer has taken or could have taken to prevent the dismissal. This also includes the question of whether all or some of the dismissals could have been prevented had you applied for NOW subsidy. This can therefore be a reason for the UWV to reject the dismissal application.<\/span><\/p>\n

NOW and reorganisation.<\/strong><\/span>
<\/u>Even if companies do make use of the NOW 2.0 subsidy, it may still be necessary to downsize further. Companies that would otherwise run into trouble must be able to adapt to the new economic reality, according to Minister Koolmees. So if you have made a NOW application, we advise you to demonstrate, with figures, that the dismissal is unavoidable despite the NOW subsidy.<\/span><\/p>\n

Dismissal penalty under NOW 2.0 removed, but still a subsidy reduction (sanction).<\/strong><\/span>
<\/u>In the event of a dismissal application during NOW 1.0, a penalty of 150% of the dismissed employee’s salary was levied. That penalty was deducted from the total subsidy, meaning you received proportionally much less subsidy. Under NOW 2.0, the penalty for economic dismissal has been reduced to 100% of the salary, but for many companies this is still a significant hit (sanction) for dismissal. This is because the level of the NOW subsidy depends on your decline in revenue. However, when calculating the dismissal (deduction) penalty, no revenue-decline percentage is used, and 100% of the wage bill is always assumed. For companies with a relatively small decline in revenue, this in fact means a high deduction from a relatively low subsidy. In the case of a planned round of dismissals, it is therefore wise to calculate how much less subsidy you will receive compared to the salary you save through the dismissal. Also take into account the fact that a notice period of at least one month must be observed for each employee. This period becomes longer the longer the employee has been employed. Once you decide on dismissal, you can therefore never immediately cut wage costs. Those wage costs will still continue for the duration of the dismissal procedure at the UWV.<\/span><\/p>\n

Extra requirement for collective dismissal.<\/strong>
<\/u>If you want to dismiss more than 20 people, mandatory consultation with trade unions must take place under the NOW. Broadly speaking, this is to discuss whether the dismissal is really necessary and under what redundancy terms (social plan) it will take place. Companies can have their total subsidy reduced by 5% if this does not happen.<\/span><\/p>\n

No easing of dismissal on personal grounds in 2020.<\/strong><\/span><\/h5>\n


Dismissal based on the statutory “personal” grounds has also not become easier since the Work and Security Act (Wet Werk & Zekerheid) in 2015. Think here of the most common grounds of underperformance, culpable conduct, or a disturbed working relationship. A request for dissolution on these grounds before the subdistrict court is assessed very strictly. To be successful, the reasonable ground must be fully substantiated, and the employer must have a well-documented file ready. In the case of underperformance, for example, employers must have done everything possible to improve performance, for instance through an improvement plan and coaching. In the case of a disturbed working relationship, for example, mediation must first have taken place, among other things.<\/span><\/p>\n

There was a great deal of criticism from the business community of this dismissal system, because the situation usually does not fit precisely into one ground. An improvement plan cannot be completed if the employer and employee can no longer work together at all. Certainly not if the difference of opinion turns out to be unbridgeable. There is then half an underperformance ground and half a disturbed-working-relationship ground. Those cannot simply be lumped together into one ground. The judge could therefore offer little tailor-made justice due to the rigid system of these limited dismissal grounds.<\/span><\/p>\n

Because politicians considered this undesirable, a new ground for dismissal was added on 1 January 2020. This is the so-called i-ground. When relying on the i-ground, a fully satisfied ground for dismissal is not required for dismissal. The point is that there is a combination of several (partial) dismissal grounds that are, together, so serious that dismissal is really the only solution. The judge can then still dissolve the contract if the i-ground applies. Think here of the previously mentioned example of an employee who is undergoing an improvement process because of underperformance. The process has not yet been completed, because a labour conflict has in the meantime also arisen. As a result, the situation is no longer workable. At that point, the i-ground can be invoked by the employer.<\/span><\/p>\n

Higher severance payment.<\/strong><\/span>
<\/u>In the event of dissolution on the i-ground, the judge can, incidentally, award a higher severance payment, namely up to a maximum of 150% of the statutory transition payment. That is compensation for the employee if the judge considers it the employer’s fault that no “full” ground for dismissal can be substantiated.<\/span><\/p>\n

Is an appeal to the i-ground successful in practice?<\/strong><\/span>
<\/u>With the introduction of the i-ground, it was expected that dismissal would become a lot easier in 2020. Even the minister said there was an “easing” of the dismissal system. A flood of dismissal cases was expected. There was particular interest in whether two “partial” dismissal grounds could now be put forward and whether the judge would then always dissolve the employment contract.<\/span><\/p>\n

That, however, turns out not to be the case: the first seven i-ground cases were, in fact, all rejected by the subdistrict courts. So what is going wrong? It turns out that employers must in any case explain very clearly why the situation is such that the parties can no longer work together and dismissal is the only option. Furthermore, a good file must still be in place to make the claims plausible. If the file largely consists of the employer’s personal opinion that things simply no longer work, then that is a weak file. This cannot be repaired by invoking the i-ground.<\/span><\/p>\n

The first cases show, in any event, that employers must always demonstrate that there is at least one almost fully satisfied ground for dismissal. Employers must also demonstrate that they have done their best to improve the situation. If too little effort has been made, or too little has been documented by the employer, to improve and substantiate the underperformance, the employer cannot then go on to disturb the working relationship themselves, so that dissolution can subsequently be successfully requested on the i-ground.<\/span><\/p>\n

First appeal to the i-ground granted on 6 July 2020<\/strong><\/span>
<\/u>On 6 July 2020, the Midden-Nederland District Court<\/a> granted the first request for dissolution on the i-ground. In this case, there was underperformance (d-ground) by the employee combined with a disturbed working relationship (g-ground). This justified dissolution on the i-ground, whereby the employee was awarded the maximum 1.5 times increase of the transition payment.<\/span><\/p>\n

The underperformance consisted of the employee performing too poorly commercially. His performance had been assessed several times since 2016 as “low performance” and once even as “unacceptable performance”. However, the improvement process consisted of nothing more than repeatedly confronting the employee with criticism. In this case, therefore, there was no fully satisfied d-ground.<\/span><\/p>\n

The employee disagreed with his negative assessments. This ultimately resulted in a disturbed working relationship. The parties engaged in mediation to resolve the conflict, but this did not help. The judge ruled that the parties remained stuck in the disagreement about the underperformance, because the employer had not given the employee a reasonable opportunity to improve his performance. The employer also did not give the employee the opportunity to receive targeted guidance and follow training. This leads to the conclusion that there was also no fully satisfied g-ground.<\/span><\/p>\n

According to the judge, dissolution on the i-ground requires that there be one almost fully satisfied ground for dismissal. In this case, the employer had invested in restoring trust through mediation. This restoration of trust was necessary to arrive at a proper improvement process, given the employee’s management-team level. However, this trust was never restored, as is also evident from the fact that the employee was released from work on 7 February 2020 and did not contest that release.<\/span><\/p>\n

In view of these circumstances, the subdistrict court judge saw reason to dissolve the employment contract via the i-ground, whereby the employee was awarded the maximum 1.5 times increase of the transition payment. That justification lies in the shortcomings the employer allowed in the improvement process, which in fact was never actually carried out. As a result, trust was ultimately permanently damaged.<\/span><\/p>\n

With the introduction of the i-ground, dismissal law has in any case become more complicated. Whether the introduction will also result in a genuine easing of dismissal law remains to be seen. This is certainly possible if the 6 July 2020 ruling is followed by others. In any case, we are keeping a close eye on developments in this area.<\/span><\/p>\n

Questions or advice?<\/span>
<\/strong>The corporate legal advisers at The Legal Company specialise in employment law. If, in light of the above, you have any questions or would like legal advice, please contact us by emailing info@thelegalcompany.nl<\/a> or calling 020-3450152<\/a>.<\/span><\/p>\n

Would you like to be directly informed of relevant legal developments for SMEs from now on? Then sign up for our monthly<\/span> Legal Alert <\/a>newsletter<\/a> and follow our company page on<\/span> LinkedIn<\/a>.<\/p>\n

Nothing changes as often as laws and regulations. We would like to point out that our blogs may no longer be in line with current laws and regulations and may therefore be outdated. If you have questions or a problem relating to this blog, or if you require legal assistance, please contact us.<\/em><\/span><\/p>\n



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