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    Statutory severance not based on full length of employment

    If an employee is hired by the same organization within six months after resignation and his/her employment contract is terminated shortly thereafter, the statutory severance pay the employee in question is entitled to may not be based on the full length of his/her employment with the organization, as ruled by the judge in a recent court case.

    Rewarded

    The employee here entered into employment on October 1, 2013, resigned as of July 1, 2019 and got back to work for the same organization on October 14, 2019. However, in November 2020 a judge dissolved the new contract as of January 1, 2021 and ruled that the employee was entitled to statutory severance pay based on the period of employment between October 14, 2020 and January 1, 2021. The employee wanted statutory severance pay based on his employment from October 1, 2013 instead, but the judge ruled that this was unacceptable.
    In the assessment of the amount of statutory severance pay someone is entitled to, subsequent periods of employment may be added together if there is no more than six months in between them. Although this was the case, the first period of employment had ended because the employee had resigned rather than having been dismissed by the employer. Statutory severance pay is intended to compensate for a dismissal and should make it easier to transition to a new job. If the employee had been given statutory severance pay based on his full length of employment, he would be rewarded for his own resignation and the employer would be financially ‘punished’.

    Court of Midden-Nederland, March 2, 2021; ECLI (abridged): 843

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