Hide & seek! With a notice payment

The Central Netherlands District Court recently held that failure to turn up at work and failing to contact an employer would justify summary dismissal.

What was the background here?

The employee had been employed  for a fixed period as a webshop worker since 1 November 2018. His second employment contract ended on 28 February 2020. Since he simply continued working after 28 February 2020, his employment contract was deemed to have been extended for one year.

The employee failed to turn up at work on 5 March 2020. On the same day, the employer sent an email confirming that his absence was unauthorised and asked him to come back to work the next day. It also offered the employee an option of cancelling his employment contract, up until 1 April 2020, with effect from 1 May 2020.

The employee still failed to turn up for work but, 17 April 2020, made a claim for the notice payment of one month’s salary. This was because the employer should have informed him in writing, no later than one month before the end of his employment contract, that his contract was being extended. The employee filed an application with the Central Netherlands District Court on 28 April 2020 for the notice payment.

The employer issued a formal written warning to the employee on 12 May 2020 that the latter should resume his work two days later. It said that there would be far-reaching consequences if the employee did not put in an appearance. The employee did not come back to work, at which point the employer summarily dismissed him on 14 May 2020 for repeated refusal to work or else for irregular absence.

For its part, the employer claimed payment of the fixed compensation for unlawful cancellation by the employee. While this maximum fixed compensation is the wage payable for the remaining duration of the employment contract, the employer was content for this to be adjusted down to one month’s salary. Even if it had to be assumed that the employee had terminated the employment contract on 4 March 2020, by cancellation or his own summary resignation, the employer argued that the cancellation was irregular. This also rendered the employee liable to pay compensation equivalent to one month’s salary.

Notice payment

The employer stated that it had clarified the matter of extension of the employment contract  with the employee verbally. For that reason, grounds of fairness and reasonableness meant that the employee could not claim the notice payment. The fact is that he knew what he was doing. The Sub-District Judge disagreed; as the employer had not terminated the contract in time and in writing, the employee was entitled to the notice payment.

Summary dismissal

The Sub-District Judge held that it would depend on all the circumstances of the case how far the departure of an employee had to be regarded as either a cancellation or summary resignation. An employer should not assume too readily that an employee meant to cancel his own employment contract. The employer has to be able to reasonably regard the statement or conduct of the employee as a cancellation. There was not sufficient evidence of this, according to the Sub-District Judge, so that the employment contract had continued in existence.

The Sub-District Judge did consider that the fact that the employee had stayed away from work and had no further contact with the employer would justify summary dismissal. It made no difference that this dismissal was only issued on 14 May 2020. The Sub-District Judge ordered the employee to pay the fixed compensation that had been claimed.

As the fixed compensation and the notice payment both amounted to one month’s salary, these amounts cancelled each other out and on balance the employer had no more to pay to the employee.

Lessons learned

While the employer here managed to limit its financial loss by taking strategic court action, employers would be wise to be meticulous about informing their employees about the continuation of employment contracts in good time.

The full verdict (in Dutch) can be found here.

Eric van Dam (evd@clintlegal.com / +31 20 820 0330)