In Dutch employment law, there are two main forms of employment contracts: fixed-term (temporary) and permanent (indefinite). The type of contract you have determines your rights, your security and the way your contract can end. We outline the differences and key considerations for you.
Permanent Employment Contract
A permanent contract has no end date. It continues until you or your employer terminates it or you mutually agree to end the contract (settlement agreement). This type of contract offers the most security, as termination can only occur according to statutory rules.
Fixed-term Employment Contract
A fixed-term contract has an agreed endpoint: this can be a fixed date, or an event such as the completion of a project. Such a contract ends automatically (by operation of law) on the agreed date or upon reaching the agreed circumstance.
Key Considerations for a Fixed-Term Contract
- For contracts of six months or longer, your employer must notify you in writing at least one month before the end whether you will receive a new contract. This is called notification. If they fail to do so or do so too late, you are entitled to notification compensation.
- If you wish to terminate early, this is only possible if this has been agreed in writing.
- A non-compete or relationship clause may only be included with written justification, otherwise it is not valid.
From Fixed-Term to Permanent Employment
If you have had three consecutive fixed-term contracts, or if your employment has lasted three years or longer without interruption, your contract is automatically converted to permanent employment. This ‘chain’ can only be broken if there is six months or longer between two contracts. The chain rule may also apply with a subsequent employer if you continue to do comparable work.
Conclusion
Whether you have a fixed-term or permanent contract: it is important to know your rights and obligations. This prevents surprises and helps you make the right choices in your career.
Do you have questions about your employment contract or are you unsure which type of contract you have? Contact us for clear and practical advice.
