Losing your job as an expat in the Netherlands

De Vreede Advocaten is a young and dynamic law firm specialised in immigration and international employment law for both businesses and individuals.

Labour migrants are often dependent upon their job to maintain their residency status in the Netherlands. So what are your rights when you face termination and do you as an expat benefit from the same protections as Dutch citizens?

In this article you’ll find answers to the following questions:
› Will you be given time to look for a new job?
› Are you entitled to unemployment benefits?
› What happens to the 30% tax ruling after you lose your job as an expat?

Contract termination

Recently, Dutch employment law underwent significant changes in order to increase the flexibility of the job market.

It was supposed to make it easier for employees to transition into new jobs, but so far the results seem far from flexible.

Termination by mutual consent

In practice, most contract terminations are arranged by mutual consent, rather than official legal proceedings.

Bargaining positions for employees seem to have become stronger, although the introduction of a transitional payment arrangement (transitievergoeding) has had a negative impact on severance payments. Unemployment benefits have been reduced as well.

Expats protected by Dutch law

Contracts of foreign local hires working in the Netherlands are in principal subject to Dutch law. "Inpat" employees working on a foreign employment agreement and on temporary secondment to the Netherlands, may not enjoy protection from dismissal.

If you are faced with losing your job it is important to learn what your rights are and it can be worth it to seek legal counsel. Often this is even part of a termination offer made by employers.

Losing your residence right

With an employment-based residence permit (such as a highly skilled migrant permit or a permit for paid employment), premature employment termination does not only mean losing your source of income.

It can also result in losing the right to stay in the Netherlands. In order to give you a chance to prolong your stay, Dutch law provides for a three-month search period which allows you to search for a new job.

Three-month search period

The main requirement for highly skilled migrants to qualify for a search period is that your employer has taken initiative for the termination and you did not lose your job "culpably".

That means that if you’re at fault for getting fired, you don’t get the three-month search period.

Culpability or bearing blame

The termination will be considered culpable if it concerns a summary dismissal (getting fired for serious misconduct, for example) or a notice of dismissal that you did not protest.

Termination by mutual consent, in the form of a settlement agreement is not considered a culpable termination provided that the settlement agreement explicitly states that the employee was not at fault and that it was the employer’s initiative to terminate the employment contract.

The element of culpability is assessed along the same lines as how your eligibility for unemployment benefits (WW uitkering) is determined.

If you have a regular residence permit for employment, you’re in a slightly better position than highly skilled migrants because you will be granted a period of three months regardless of the termination grounds.

Communicate with the IND

Your employer has to notify the Immigration and Naturalisation Services (IND) of your contract termination within four weeks. Although your search period starts more or less automatically by law, it can happen that the IND starts a process anyway to withdraw your residence permit.

It’s therefore recommended to immediately inform the IND of your intention to make use of the search period and to clearly state on which basis you are entitled to it.

The search period allows searching for a new job that corresponds with your current residence permit and which bridges the residency gap between jobs.

If you are not able to find a new job within the three months - one that matches the requirements of your permit - your residence permit will be withdrawn with retroactive effect as from the termination date.

Please note that if the latter occurs, you may face a residence gap. A residence gap can have significant consequences for any future applications and procedures in the Netherlands.

Unemployment benefits

You may be eligible for short-term unemployment benefits if:
› you are insured for unemployment in the Netherlands
› you worked at least 26 weeks out of the last 36 weeks before you became unemployed
› your dismissal is not culpable

Those who were seconded to the Netherlands and who hold a "Certificate of Coverage" likely have not been contributing to the unemployment benefits scheme in the Netherlands and hence may not be eligible.

An application for unemployment benefits should be filed with the UWV as soon as you lose your job. Applying for unemployment benefits will not affect your residence right in the Netherlands.

It’s important to note that if that if you choose to leave your job by resigning, you will not be granted unemployment benefits.

30% tax ruling

If you benefit from the 30% tax ruling you can transfer it to a new employer, provided that the period between the last day of work at the previous employer and the date of agreement of your new contract does not exceed a period of three months.

This time period can be an issue in cases where parties agree on garden leave. This is a period in which the employee is formally on the payroll, but without the obligation to work. The three-month period starts when garden leave begins.

Know your rights

Losing your job when you’re an expat living abroad can create a stressful situation. It is therefore important to know your rights under Dutch law and how your employment situation impacts your residence status.

You should communicate your situation to the IND to guarantee you get the three-month search period to look for a new job. And if you are unsure about your own particular situation, it’s always a good idea to seek some expert legal counsel.
 

Are you worried you may lose your job in the near future? Contact De Vreede Advocaten to learn more about what your options are.