For expats working in the Netherlands, a settlement agreement (VSO) can be particularly complex. In addition to the usual topics such as severance payment and end date, international aspects often play a role: residence status, tax regulations and employment conditions that differ from the standard.
In this article, we explain what expats should look out for in a VSO and which pitfalls they can avoid.
What is a settlement agreement?
A VSO is a termination agreement between employer and employee in which arrangements are made about the dismissal. For expats, the same basic rules apply as for Dutch employees:
It is always voluntary.
You retain the right to unemployment benefits, provided the VSO is correctly drafted.
Virtually all terms are negotiable.
Special considerations for expats
1. Residence status and work permit
For expats from outside the EU, dismissal can have consequences for the residence permit.
Check whether your permit is linked to your employer.
Discuss whether a transitional period can be agreed in the VSO.
Sometimes a longer notice period or additional compensation can help buy time.
Example: An expat from India had a residence permit linked to his employer. Through negotiations, he received an additional six months of continued payment, giving him time to find a new employer and retain his residence status.
2. Tax and the 30% ruling
Expats can make use of the 30% ruling, a tax advantage for foreign employees in the Netherlands.
Upon termination, this advantage may lapse.
Negotiate for compensation if you lose net income as a result.
3. International employment conditions
Expats often have additional benefits, such as:
Housing allowance
School fees for children
Flight costs to the home country
Ensure that these provisions are properly addressed in the VSO.
4. Repayment of costs
Some employers include in the contract that certain costs (such as relocation or training costs) must be repaid upon early departure.
Negotiate that these obligations are waived.
5. Non-compete clause
A non-compete clause can be particularly restrictive for expats who wish to continue their career in the Netherlands. Ensure that it is limited or removed.
Checklist: VSO for expats
Check the impact on your residence status and work permit.
Check whether your 30% ruling ends and request compensation.
Pay attention to additional provisions (housing, school fees, travel costs).
Negotiate that repayment obligations are waived.
Review non-compete and relationship clauses.
Always have the VSO checked by an employment lawyer.
Common mistakes made by expats
Signing too quickly without advice, putting residence status at risk.
Not paying attention to the loss of the 30% ruling.
Forgetting to claim additional benefits (housing, school fees).
Forgetting that unemployment benefits also apply to expats, provided the VSO is correctly drafted.
Frequently asked questions (FAQ)
1. As an expat, do I retain the right to unemployment benefits with a VSO?
Yes, provided you meet the conditions and the VSO is correctly drafted.
2. What happens to my residence permit after dismissal?
That depends on your status. You often need to find a new job within a few months.
3. Can I keep my 30% ruling?
Only if you start with a new employer within three months.
4. Do I have to repay training or relocation costs?
Not always. This is negotiable in the VSO.
5. Can a lawyer help with expat matters?
Yes, precisely because of the additional legal and tax complexity.
Why Arslan Advocaten?
Specialised in employment law and expat rights
Experience with residence status and the 30% ruling
Negotiating for higher compensation and preservation of benefits
Guidance with international contracts and disputes
Conclusion
For expats, a settlement agreement is often more complex than for Dutch employees. Consider residence status, tax advantages and additional employment conditions. Therefore, always have a VSO checked, so you can be sure that you are not only fairly compensated but also safeguard your future in the Netherlands.