An employer cannot simply dismiss an employee. In the case of business economic reasons (such as declining revenue, cost savings or a relocation), the employer must apply for a dismissal permit from the UWV. This type of dismissal frequently occurs during reorganisations, but the procedure and conditions are strict.
In this article, we explain how dismissal due to business economic reasons via UWV works, what rights you have and how you can defend yourself.
When is there business economic dismissal?
An employer can apply for business economic dismissal at UWV in the following situations:
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Structural decline in revenue or poor financial situation.
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Cost savings are necessary.
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Loss of work due to technological changes or automation.
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Relocation or closure of (part of) the company.
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Organisational changes (for example merger or demerger).
It must always concern structural circumstances that persist for more than 26 weeks.
When must you report a collective dismissal?
If you wish to dismiss 20 or more employees within three months, you are in many cases obliged to report this to the UWV and the relevant trade unions. This reporting obligation exists to ensure that employees, trade union organisations and bodies such as the works council are informed in a timely manner and can contribute to possible solutions or alternatives. Please note: this obligation only applies when the dismissals concern business economic reasons and take place within a relatively short period.The role of the UWV
The employer must apply for a dismissal permit from the UWV. The UWV assesses:
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Are the business economic reasons sufficiently substantiated?
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Has the reflection principle been correctly applied?
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Is redeployment within a reasonable period possible?
Only when these conditions are met does the UWV grant permission for dismissal.
Which forms are needed for a dismissal application?
To apply for dismissal on business economic grounds, the employer must complete a number of specific forms:- Part A: This records the employer's details.
- Part B: This form is completed separately for each employee for whom dismissal is requested.
- Part C: In this section, the employer must clearly explain why the dismissal is necessary, supported by relevant arguments and documents.
- Personal and company details: First, in the first part you enter all relevant information about yourself as an employer and your company. Think of contact details, the business address and other basic information that makes clear who is submitting the application.
- Employee information: Next, the second part requires an overview of the employees for whom dismissal is being requested. Here you list matters such as job titles, employment contracts, dates of birth and years of service of the employees involved.
- Substantiation of the dismissal: Finally, you are asked to clearly explain why you believe the dismissal is necessary. You explain here what circumstances, such as a prolonged decline in revenue or reorganisation, lead you to this request. Financial data, reports or other supporting documents are often required to substantiate your request.
What if not all required documents have been included?
It can happen: you accidentally forget to include a document with your dismissal application. No need to panic. If something is missing or if additional information is needed, you will receive a notification about this. It states exactly which documents are still expected and where you can send them. Important: you are usually given a short deadline for this, such as 8 days. Only after all requested data and documents have been received will the dismissal application be further processed. Therefore, ensure you provide everything as completely and quickly as possible to avoid delays.The reflection principle
In case of business economic dismissal, an employer may not arbitrarily choose who is dismissed. The reflection principle distributes the dismissals across age groups within a job category. This ensures that employees are fairly distributed across the various age categories.
Employee rights in case of dismissal via UWV
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Right to the transition payment.
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Right to correct application of the reflection principle.
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Right to redeployment in another suitable position, if available.
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Right to object to an incorrect UWV procedure.
Objection and defence
Do you disagree with the dismissal?
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You can file a defence at the UWV during the procedure.
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After the decision, you can go to the subdistrict court judge for a review of the reason for dismissal or the compensation.
Requesting a postponement for negotiations
Do you wish to negotiate with your employee(s) about a termination arrangement during the UWV procedure? You can request a postponement for negotiations. This works as follows:- Indicate immediately with your dismissal application that you wish a postponement for negotiations.
- Complete only the first sections of the application (such as personal details and details of the employee involved), but sign and submit with the request for a 14-day postponement.
- Include the name, address details and citizen service number of the relevant employee(s).
What if you do not respond (or are too late) after a postponement?
Have you been granted a postponement to file a defence, but you subsequently fail to respond on time? Then you lose the right to still file a substantive defence in this procedure. The employer's dismissal application will then be processed without your response, and the UWV will make a decision based on the employer's file documents. Responding on time therefore remains crucial: do not let it slide and seek legal help immediately if in doubt.Practical examples
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Example 1: An employer applied for dismissal due to reorganisation. The UWV rejected this because the figures provided insufficient substantiation.
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Example 2: During a merger, dismissals were distributed. Because the reflection principle was incorrectly applied, the court annulled the dismissal.
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Example 3: An employee was dismissed via UWV, but after objection received a higher compensation through the subdistrict court judge.
Checklist for dismissal via UWV
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Check the substantiation of the business economic reasons.
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Verify whether the reflection principle has been correctly applied.
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Ask whether redeployment has been investigated.
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Check whether the transition payment has been correctly calculated.
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Consult an employment law attorney for objections or negotiations.
Further negotiation after submitting a dismissal application
Do you wish to still negotiate with your employees about terminating their contract after submitting a dismissal application? That is possible. In that case, only complete Part A of the form and clearly indicate that you would like an extra 14 days to negotiate. Do not forget to include the names, address details and citizen service numbers of the relevant employees with your application. Once you have submitted the form, it will be assessed whether the postponement is granted. Have you been granted the postponement? Then you must report the result of the negotiations no later than the last day of this period and indicate whether you still wish to proceed with the dismissal procedure. Please note: if you do not respond or respond too late, your dismissal application will be automatically withdrawn.Common mistakes
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Thinking that a UWV decision is always final.
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Not objecting to incorrect application of the reflection principle.
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Not having the compensation calculation legally checked.
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Agreeing too quickly to an employer's proposal.
Frequently Asked Questions (FAQ)
1. Can my employer simply dismiss me via UWV?
No, only with a valid business economic reason and correct procedure.
2. Am I entitled to compensation upon dismissal via UWV?
Yes, at least the transition payment.
3. What if the UWV approves the dismissal but I disagree?
Then you can take the matter to the subdistrict court judge.
4. How do I know if the reflection principle has been correctly applied?
A lawyer can verify this and lodge an objection if necessary.
5. Can my employer redeploy me to a different position?
Yes, if suitable positions are available, the employer must investigate this.
Why Arslan Advocaten?
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Specialised in business economic dismissal and UWV procedures
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Verify whether dismissal rules have been correctly applied
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Guidance with objections and proceedings before the subdistrict court judge
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Negotiate for better compensation or arrangements
Conclusion
Dismissal due to business economic reasons via UWV is only permitted under strict conditions. As an employee, you are entitled to protection, compensation and a fair procedure. Always have your situation legally assessed, so that you do not miss out on any rights.
