The notice requirement: don't leave your employee hanging!
An employer has to inform an employee who is working under a fixed-term employment contract, in writing and no later than one month before the employment contract is going to end by operation of law, whether (a) the employment contract is going to be continued, and if so, (b) about the terms on which it intends to continue the employment contract. This is called the “notice requirement,” and it applies to temporary employment contracts of six months or longer. If the employer fails to do so or fails to do so in a timely manner, the employment contract does still come to an end, but it will owe the employee compensation of up to one month’s salary.
Employers often rely on having covered the notice requirement by including a provision in the employment contract at the start of the employment relationship stating that it will not be continued after the expiry of the agreed term. Smart, because that way the notice requirement is met in advance – isn’t it?
Unfortunately, this is not always the case, according to a recent judgment of the Rotterdam subdistrict court.
The case
This judgment concerned an employee of Attractiepark en Camping Duinrell B.V. who was working under a fixed-term employment contract. This was already the third temporary contract that he had had. The temporary employment contracts always stated:
“The employer informs the employee that, after the expiry of the agreed term, the employment contract will not be continued (Art. 7:668 of the Dutch Civil Code).“
However, contrary to this provision, the first two employment contracts had been continued. It was only at the end of the third fixed-term employment contract that it was decided that there would be no continuation. The employee then took the position that Duinrell had not met its notice requirement with its notice provision in the third fixed-term employment contract.
Clarity
The subdistrict court agreed with the employee and found that in this situation, where the notice provision had been included three times in the successive employment contracts, and contrary to this notice the contract had been extended twice, the notice provision in the (final) employment contract was no longer sufficient.
This is because the purpose of the written notice is to give the employee clarity (in good time) on the continuation of his employment contract so that he does not live in uncertainty as to whether or not his employment contract is going to come to an end. According to the subdistrict judge, Duinrell did not provide this clarity. The subdistrict judge explained this with a nice analogy:
“This brings to mind a comparison with Aesop’s fable: The Boy Who Cried Wolf. After the boy, who was supposed to watch over the flock of sheep, had raised the alarm for nothing three times by crying “wolf,” no one responded to his alarm the fourth time, and in the evening the father saw only a wolf with a fat belly and his son’s straw hat sticking out of the wolf’s mouth. Translated to this case, in which the employer cried “wolf” three times, but despite the advance notice in the employment contract continued it the first two times anyway, the third time it cried “wolf” could no longer seriously be considered as notice.”
Tip!
This judgment shows that a notice provision included in the employment contract is, in certain circumstances, insufficient to be deemed legally valid. This is particularly the case when there are conflicting signals from the employer, such as the continuation of a previous employment contract with a notice provision, as a result of which the employee can no longer assume that the notice provision in the subsequent employment contract applies.
Are there notice provisions in your employees’ employment contracts? Then make sure you give written notice if a previous employment contract was continued contrary to that provision. It is even better if you always give timely, written notice, regardless of any previous notice in the employment contract. This prevents discussions but more importantly: the employee thus gets the necessary clarity as to whether the employer will want to renew the employment contract.
Lees deze blog post in het Nederlands hier.
