In Utrecht, where the labor market is vibrant with sectors such as tech, government, and education, the transition compensation is a crucial right in cases of dismissal. However, there are important exceptions where employers are not required to pay. According to Article 7:673(7) of the Dutch Civil Code (Burgerlijk Wetboek), no compensation is due in cases of dismissal due to seriously culpable conduct by the employee, such as theft or fraud—a common issue among Utrecht-based companies along the Merwedekanaal zone.
In cases of bankruptcy or suspension of payments, as recently seen with some Utrecht startups in the Utrecht Science Park, the transition compensation is often settled through the UWV trustee. Note: this is not always in full, and residents of Utrecht can turn to the District Court of Midden-Nederland in Utrecht for trustee-related matters. For fixed-term contracts that expire naturally without notice—typical in the flexible hospitality sector around the Oudegracht—you are not entitled to transition compensation.
Before 2020, special rules applied to employees over the age of 50, but now the standard calculation applies throughout Utrecht. In reorganizations, such as those at government institutions in the Kanaleneiland district, a collective agreement may replace individual compensation, provided it is equivalent. Resignation at the employee’s own initiative, for example, termination during illness, forfeits the right to compensation. Employers may offset the compensation against a settlement agreement, but only with explicit agreement.
These rules will not change in 2025, but check the collective labor agreement (CAO) of Utrecht industry organizations such as UNETO-VNI for the installation sector. In doubt? Contact a local legal advisor at the Legal Counter Utrecht or law firms on Drift for tailored advice and avoid disadvantage in this dynamic region.