With the entry into force of the Work and Security Act (WWZ), the problem of “dormant employment” arose. This problem also remains under the Balanced Labor Market Act (WAB), which came into effect on January 1st, 2020.
The dormant employment relationship
In short, a dormant employment contract is an employment contract that continues to exist after 2 years of incapacity for work of the employee, despite the absence of an obligation to continue paying wages for the employer and despite the employer’s authority to terminate the employment contract. Because the employer owes a (transition) compensation in the event of such termination, some employers choose to maintain the employment contract.
Many employers have indicated that they find it unreasonable that they have to pay these types of employees a transition payment. In that case, the employer has usually continued to pay wages for two years and has often also incurred costs in the context of reintegration (see the Wet Verbetering Poortwachter).
Now that an employer is in principle not obliged to terminate the employment contract after two years of illness, he can choose to maintain the employment contract and therefore keep the employment contract “dormant”. In principle, the employer is no longer obliged to continue paying wages after two years of illness and, if the employment contract is not terminated, no transition compensation has to be paid.
However, a long-term ill employee often has an interest in the employment contract ending and the transition payment being paid.
Since the WWZ came into effect, there have been repeated legal proceedings on the question of whether unwillingness to pay the transition payment is sufficient reason to maintain the employment contract.
The first ruling regarding dormant employment was made in December 2015. The subdistrict court judge considered that maintaining the employment contract in order to avoid the transition payment could be regarded as indecent, but that this did not mean that the employer had to terminate the employment contract.
However, rulings from the lower courts subsequently went in all directions. On November 8th, the Supreme Court, in response to preliminary questions, commented on this issue for the first time and provided clarity on how to deal with dormant employment.
Supreme Court judgment November 8, 2019
The procedure before the Supreme Court concerned – in short – the question of how to deal with the problem of weak employment.
The Supreme Court answers this question as follows: If an employment contract can be terminated due to long-term disability, the basic principle is that the employer, on the grounds of good employment practices, is obliged to agree to a proposal from the employee to terminate the employment contract by mutual consent. , with compensation to the employee equal to the statutory transition payment.
The foregoing is a starting point. This means that exceptions are possible. In that case, the employer will have to demonstrate that he has a legitimate interest in maintaining the employment contract. It is clear that simply not wanting to pay the transition compensation is not sufficient for this. (Legal) practice will have to show when an exception is possible.
