Sick employees and termination agreements

Employees are dismissed on a regularly basis and as a part of this, termination agreements are being closed. However, sometimes these termination agreements result in problems with the employment office ( in the Netherlands the so called “Uitvoeringsinstituut Werknemersverzekering”(“UWV”)), including this recent case of the Dutch court of Overijissel . (Rechtbank Overijssel 23 december 2015, ECLI:NL:RBOVE:2015:5771), in which the UWV refused to pay the unemployment compensation and the sickness benefits to the employee.

In this case the employee had been on sick leave and had not been to work for over one year. Meanwhile, his employer restructured his company and therefore dismissed a lot of employees. That is why also the employee who was on sick leave got a proposal for a termination agreement from his employer. The (sick) employee accepted this termination agreement and hence the employment relation came to an end. Thereupon the UWV denied the request for unemployment compensation and sickness benefits. It argued that the employee had been on sick leave while signing the agreement and therefore the employee should not have agreed to sign it. Hereupon the former employee demanded the payment of his salary from his former employer.

In conclusion, the court decided that the employer did not inform the employee adequately about the consequences of his dismissal. The employer should have informed the employee about the risk of not getting any unemployment compensation or sickness benefits from the UWV because of his sick leave. Due to its responsibilities as `good employer`, an employer is obliged to `inform its employees duly and completely` in such a case. Would the employer have met this requirement, the employee would certainly not have agreed to sign the termination agreement! Therefore the termination agreement was cancelled (whereby the dismissal does not exist anymore) and the employer still had to pay the salary to his employee.

In short, it is important for employers to inform their employees duly and completely about the consequences of a termination agreement. Does the employer fail in doing so, the employee can annual the agreement and continue to claim his or her salary.

Maybe you have questions about Dutch labour law. These questions can refer to dismissals or concern termination agreements and their consequences for unemployment compensation and sickness benefits. You may also have questions about employees on sick leave and the payment of their salary. You are welcome to contact one of our lawyers. Our specialist solicitor for labour law, Manon Pieters, is at your disposal and will help you with labour law questions!

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