Temporary Contract Not Renewed: Are You Entitled to Compensation?

Many young people work with a temporary contract. At the end of the contract they are told: “We will not renew it.”
It is often thought that this is always allowed and that you are entitled to nothing. That's not.

In this blog we clearly explain when an employer may let a temporary contract expire, when you are entitled to compensation, and what you can do what to do if things didn't go smoothly.

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Can a temporary contract simply not be extended?

Yes, an employer may let a temporary contract expire.
But that does not mean that he does not have to follow any rules.

What is especially important is:

• how the contract ends

• whether the employer complies with its obligations

What is the chain arrangement and how does it work for temporary contracts?

Have you been working with the same employer on temporary contracts for a while? Then the chain arrangement is important to know. This scheme determines how many temporary contracts you can have in succession, and for how long, before you are automatically entitled to a permanent contract. The main rules:

• You may have a maximum ofthree temporary contracts with the same employer.
• Together, these contracts may not last longer than 36 months (i.e. three years).

Will there be afourth contract, or will you work for more than three years in a row? Then your temporary contract will automatically change into a permanent contract. Note these exceptions:

• Have you not worked forsix months or more between contracts? Then the counting starts again.
• Some collective agreements may contain other agreements—so always check whether there is a collective agreement with different rules that apply to your work.

This is how the chain arrangement endlessly slogging through on temporary basic.

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How do you check whether you are entitled to a permanent contract?

Are you unsure whether your temporary contract will automatically turn into a permanent contract? You can easily check this by checking a few points. Pay particular attention to the number of contracts you have had and the total period that you have worked for the same employer. According to the chain regulation in law, the following usually applies:

• After three temporary contracts with the same employer you are entitled to a permanent contract.
• If you have worked on temporary contracts for more than 36 months (three years) in a row, you will also receive permanent employment.

Are there more than six months between two contracts during which you were not employed by the same employer? Then the counting starts again. In addition, a collective labor agreement (collective agreement) may contain other agreements – for example, sometimes you may receive an extra contract, or a different term applies. So always check whether your sector has such a collective agreement and what exactly it contains. Short:

• Count all your temporary contracts with the same employer.
• See if together you exceed the limit of three contracts or 36 months.
• Check the collective agreement for different rules.

Do you have a permanent contract? Then you usually have more protection: your employer cannot simply dismiss you.

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The notification obligation: this often goes wrong

Does your contract have a duration of 6 months or longer?
The employer must let you know at least one month before the end:

• or the contract will be extended

• and if so, under what conditions

This is called the notification obligation.

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What if the employer does not do this (on time)?

Then you are entitled to a notification fee:

• maximum one gross monthly salary

• also for side jobs and part-time work

• even if you are a student

Many young people miss out on this compensation, even though they are entitled to it.

How do you claim the initiation fee?

Important: you must claim the notice compensation yourself from your employer. Send aclear letter or email indicating that you are entitled to the notice fee, and stating the exact amount you are claiming. Is your employer refusing to pay? Then you must submit a petition to the court within 3 months after the date on which the employer should have given notice. This is no later than 2 months after the end of your temporary contract.

Are you late? Then your right to compensation will lapse. So make sure you'reon time.

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How should the notice be given?

The notice must:

• in writing (email, letter, WhatsApp is also possible)

• be clear (“we are not renewing” or “we are renewing”)

Does the employer say nothing or only at the last minute?
👉 Then compensation is often due.

What other employment conditions must be settled?

In addition to your usual salary, there are more employment conditions to which you are entitled at the end of your temporary contract. Pay close attention to this so you don't miss anything:

• Holiday pay: This must be paid correctly until the last day.
• Unused vacation days: All outstanding vacation days must be paid out.
• Allowances and bonuses: Consider period allowances, end-of-year bonuses or performance bonuses to which you are already entitled.

Are these parts not paid for properly? 👉 Then you can still claim what you are entitled to through a wage claim.

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Are you entitled to a transition payment?

In many cases: yes.

Even with a temporary contract you are entitled to a transition compensation if:

• the contract ends at the initiative of the employer

• you have been employed for at least 1 day

This also applies to:

• young people

• students

• part-timers

• employees with a part-time job

The idea that you have worked “too short a time” is often incorrect.

How is the amount of the transition compensation calculated?

The transition payment is determined based on your gross monthly salary and the number of years you have been employed. In 2025:

• You will receive1/3 of your gross monthly salary per year of service worked.
• Does your total compensation exceed € 98,000? Then that amount applies as the maximum. Or—if your annual salary is higher than €98,000—you will receive the full annual salary at most.

Please note: even if you have only worked for a few months, you will receive a pro-rated compensation. Useful to know, because many young people and students think this does not apply to them!

When can you be entitled to fair compensation?

Sometimes the normal transition payment is not the end of the story. Has your temporary contract not been extended due to serious misconduct by your employer? Then you may be entitled to additional compensation: thefair compensation. This happens, for example, if the employer really misbehaves, such as:

• harassment
• discrimination
• undue pressure to stop
• other inappropriate behavior

The judge can grant this if it is clear that the termination of the contract was not done properly at all. Such compensation is on on top of the transition compensation, and the amount can – depending on what happened – rise considerably.

Serious culpable behavior by the employer: additional compensation possible

Has your temporary contract not been extended due to serious behavior by the employer? Then you can sometimes get more than just the transition compensation. When are you eligible? For example, if the employer:

• engages in intimidation or bullying
• discriminates based on background, gender, religion, or anything else
• unfairly pressures you to resign yourself
• clearly goes over the line in another way

In such situations – in addition to the normal compensation – you can ask the court for anadditional severance payment (the so-called 'fair compensation'). That can increase depending on what exactly happened. The judge looks at all the facts and the consequences for you. In short: if the employer really goes too far, there is sometimes an extra pot of money waiting for you.

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When are you not entitled to compensation?

You will not receive compensation in all situations. For example if:

• you cancel yourself

• the contract ends during the trial period

• you have been summarily dismissed (rightly)

• the employer has notified correctly and on time

But this needs to be looked at carefully. Employers regularly make mistakes here.

Exceptions due to collective labor agreements

Please note: some temporary contract rules may differ if a collective labor agreement applies. For example, a collective labor agreement may stipulate that you may receive more temporary contracts before a permanent contract is created, or that the maximum 'chain period' is longer than normal. Always check carefully whether a collective labor agreement applies within your sector, such as in the catering industry (KHN) or in healthcare (CAO Hospitals). The deviations can be either favorable or unfavorable for you. Are you in doubt? Then it is wise to consult the collective labor agreement or a legal expert.

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Common tricks (and why they don't always work)

We see in practice:

• “We said it verbally”

• “You already knew it”

• “It was just a side job”

• “We will text on the last day”

👉 This is often not sufficient.
The law sets clear requirements.

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What should you do if your contract is not extended?

Use this step-by-step plan:

1. Check the duration of your contract

2. Check if and when a notification has been made

3. Save emails, apps and contracts

4. Calculate whether you are entitled to compensation

5. Take action on time

If you wait too long, you may lose your rights.

What can you do if your employer doesn't pay?

Do you notice that your employer refuses to pay out the notice fee or your overdue wages? Don't leave it at that—you have rights.

This is how you do it:

• First claim in writing: Send a clear email or letter. State that you are entitled to the notice compensation (or unpaid wages) and state the exact amount.
• No response or refusal? Take action! The following applies to the notice compensation: within three months after the time at which the employer should have given notice, you can claim your right from the subdistrict court. This must be done no later than two months after the end of your contract.
• Note the term: If you are late, you will lose your chance of reimbursement. So put a reminder in your calendar and be there on time.
• Claim back wages: You have more time for overdue salary: you can still claim this up to five years after the date of payment. But: the faster you respond, the stronger your case is often.

Are you unsure whether you are taking the right steps? Always ask for advice to avoid wasting money.

How do you know if you will still receive wages after the end of your contract?

In addition to compensation, you may also be entitled toback wages at the end of your contract. This goes wrong more often than you think: sometimes the wrong salary is paid, overtime or holiday pay is forgotten, or a lower scale is accidentally applied. This is how you check whether you have received everything you are entitled to:

• Grab your last pay slips, together with your contract and any collective labor agreement (Collective Labor Agreement).
• Check whether your salary, holiday pay and outstanding holiday days have been paid in full.
• Compare your paid wages with the statutory minimum wage and the salary that corresponds to your position and age according to the collective labor agreement. For example: on the site of theCentral Government you can check the minimum wage, and atFNV, CNV or your own trade union you will find collective labor agreement information.
• Also check whether you have received allowances for evening, weekend or overtime work, for example, if this was the case according to your schedule.

Do you notice anything that is incorrect or are you missing amounts? Ask your employer immediately for an explanation and keep all communications about this. Does disagreement remain? Then you can claim it up to five years after the end of your contract. Note: mistakes are common – so double-checking is always smart.

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Common mistakes made by young people

• think they are not entitled to anything

• do not keep evidence

• replies too late

• assume that “not renewing” is always okay

That's a shame. In many cases there is money to be had.

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Are you unsure whether you are entitled to compensation?

Are you:

• student

• part-timer

• young person with a temporary contract

and has your contract not been extended?

Then have it checked. It often turns out that:

• no notice has been given (on time)

• you are entitled to compensation

• the employer has made mistakes

👉 Please feel free to contact us for an assessment of your situation.