Dismissal During Sick Leave in the Netherlands

If you are on sick leave and your employer wants to end your employment, you are protected by one of the strongest employee safeguards in Dutch law: the dismissal ban during illness (opzegverbod bij ziekte). This protection means your employer generally cannot dismiss you during the first two years of your illness. However, there are important exceptions, and many employers try to circumvent the ban through a settlement agreement. In this article, you will learn exactly what protections you have, when your employer can still dismiss you, and what to do if you receive a settlement agreement while you are ill.

The dismissal ban during sick leave

In the Netherlands, employees who are unable to work due to illness enjoy comprehensive legal protection against dismissal. The core of this protection is laid down in Article 7:670 of the Dutch Civil Code (Burgerlijk Wetboek, or BW). This provision prohibits your employer from terminating your employment contract during the first two years of your illness. The ban applies regardless of the type of illness, whether physical or psychological, and regardless of whether the illness is work-related or not.

The dismissal ban is one of several opzegverboden (prohibitions on termination) in Dutch employment law. These prohibitions exist to protect employees in vulnerable situations. Illness makes you particularly vulnerable: you are often unable to look for new employment, you may be dependent on your employer for continued salary payments and reintegration support, and you may be under significant emotional and financial stress. The legislator has determined that dismissal during this period would be unreasonably harmful to employees.

The protection applies to all forms of termination initiated by the employer, including termination through the UWV (the Dutch Employee Insurance Agency). If your employer requests permission from the UWV to dismiss you on economic grounds, the UWV will refuse the request if you are on sick leave, unless one of the statutory exceptions applies. The subdistrict court (kantonrechter) takes the dismissal ban into account (known as reflexwerking), but may in exceptional circumstances still dissolve the employment contract — for example, if the grounds for dismissal are unrelated to the illness.

Legal basis: Article 7:670 BW

The legal foundation for the dismissal ban during illness is Article 7:670, paragraph 1, under a of the Dutch Civil Code. This article states that the employer may not terminate the employment contract during the period in which the employee is unable to work due to illness, unless the incapacity has lasted for at least two years. The provision is part of a broader set of dismissal prohibitions that also cover situations such as pregnancy, military service, and membership of works councils.

Key aspects of the statutory provision include:

• Automatic application: the ban applies automatically from the moment you report sick. You do not need to invoke it explicitly or take any legal action. Your employer is simply prohibited from terminating your contract.
• Nullity of dismissal: if your employer dismisses you in violation of the ban, the dismissal is vernietigbaar (voidable). You can challenge the dismissal within two months by invoking the nullity. If you do so successfully, the employment contract is considered never to have been terminated.
• No waiver possible: the dismissal ban cannot be waived by agreement. Your employer cannot include a clause in your employment contract stating that the ban does not apply. Any such clause would be null and void.
• Applies to all employees: the ban applies to employees with both permanent and temporary contracts. For temporary contracts, the ban prevents early termination but does not extend the contract beyond its agreed end date.

It is important to note that the dismissal ban applies to termination by the employer (opzegging). It does not prevent the employer from offering you a settlement agreement, since a settlement agreement is technically a mutual agreement rather than a unilateral dismissal. This distinction is crucial and is discussed in detail below.

Two years of protection

The dismissal ban during illness lasts for a maximum of two years (104 weeks). If the UWV imposes a wage sanction on the employer for inadequate reintegration efforts, this period can be extended by up to 52 weeks (to a maximum of 156 weeks). This period corresponds with the employer's obligation to continue paying your salary during illness, as laid down in Article 7:629 BW. During these two years, your employer must pay at least 70% of your salary (with the minimum wage as a floor in the first year, and subject to the statutory maximum daily wage), and must actively support your reintegration into the workplace.

The two-year period is calculated from the first day of your illness. If you partially recover and then fall ill again with the same or a related condition within four weeks, the periods of illness are added together. This prevents employers from restarting the clock by briefly allowing an employee to return to work. However, if you fully recover and remain healthy for more than four weeks before falling ill again, a new two-year period begins.

During these two years, both you and your employer have obligations under the Gatekeeper Improvement Act (Wet verbetering poortwachter). Your employer must arrange a company doctor, create a reintegration plan, and actively work towards your return to work. You must cooperate with reasonable reintegration efforts. Failure to comply with these obligations can have consequences: for your employer, the UWV may impose a wage sanction (loonsanctie) by extending the salary payment obligation by up to one additional year (52 weeks), which also extends the dismissal ban to a maximum of 156 weeks total. For you, non-compliance can lead to suspension or even termination of your sick pay.

Exceptions to the dismissal ban

While the dismissal ban during illness is broad, it is not absolute. Dutch law recognises several specific situations in which your employer can terminate your employment despite your illness. Understanding these exceptions is essential for assessing your legal position.

1. During the probationary period

If you are still within your probationary period (proeftijd), your employer can terminate your employment at any time, for any reason, including during illness. The probationary period is typically one month for temporary contracts of two years or less, and two months for permanent contracts or temporary contracts exceeding two years. The dismissal ban during illness does not apply during the probationary period. However, if the employer dismisses you solely because of your illness, this may constitute discrimination on the grounds of disability or chronic illness under the Equal Treatment on the Grounds of Disability or Chronic Illness Act (Wet gelijke behandeling op grond van handicap of chronische ziekte).

2. Summary dismissal (ontslag op staande voet)

Your employer can dismiss you with immediate effect (ontslag op staande voet) if there is an urgent reason (dringende reden) within the meaning of Article 7:677 and 7:678 BW. Examples of urgent reasons include theft, fraud, or serious threats. The illness itself can never be an urgent reason, but your conduct during illness can be. If you refuse to cooperate with reintegration, your employer must first follow a graduated approach: issuing written warnings, stopping salary payments (Article 7:629 paragraph 3 BW), and preferably requesting an expert opinion (deskundigenoordeel) from the UWV. Only after sufficient documentation of persistent refusal can the employer file for dissolution of the employment contract with the subdistrict court. Summary dismissal for reintegration refusal alone is exceptional and is a measure of last resort.

3. After two years of illness

Once you have been ill for two continuous years (or longer in the case of a UWV wage sanction, up to a maximum of 156 weeks), the dismissal ban expires. Your employer can then apply to the UWV for permission to terminate your employment on the ground of long-term incapacity for work (langdurige arbeidsongeschiktheid). The UWV will grant permission if the employer can demonstrate that you are unable to perform your own work, that there is no prospect of recovery within 26 weeks, and that there is no suitable alternative work available within the organisation. Even after two years, your employer must still pay you the statutory severance pay (transitievergoeding).

4. Complete business closure

If the employer's entire business ceases to exist, the dismissal ban does not prevent the termination of your employment. This exception applies only to the complete closure of the business, not to the closure of a department or branch. In the case of a partial closure, the ban remains in effect for ill employees.

5. Illness reported after the dismissal application

If your employer had already submitted an application for dismissal permission to the UWV or the subdistrict court before you reported sick, the dismissal ban does not apply. This exception is designed to prevent employees from reporting sick strategically to obstruct a pending dismissal procedure. However, the employer must prove that the application was submitted before the illness was reported, and you must have a genuine illness for the ban to be relevant in the first place.

6. Mutual agreement (settlement agreement)

Technically, a settlement agreement is not a dismissal but a mutual agreement to end the employment. The dismissal ban therefore does not apply to settlement agreements in the strict legal sense. However, agreeing to end your employment while you are ill carries significant risks, which are discussed in the next section.

Settlement agreement during sick leave

Because the dismissal ban prevents your employer from unilaterally terminating your contract during illness, many employers try a different approach: offering you a settlement agreement (vaststellingsovereenkomst). By signing this agreement, you would mutually agree to end the employment, thereby circumventing the dismissal ban. This is legally permissible, but it can be extremely disadvantageous for you.

When you receive a settlement agreement during sick leave, you should be aware of the following critical issues:

Loss of continued salary payment

Under Article 7:629 BW, your employer is obliged to continue paying your salary for up to two years during illness. If you sign a settlement agreement, this obligation ends on the agreed termination date. You lose the right to continued salary payments for the remainder of the two-year period. Depending on how early in your illness you sign, this could mean the loss of many months of salary.

Risk to sickness benefits

If your employment ends while you are ill, you would normally transition to sickness benefits (Ziektewet-uitkering) from the UWV. However, if you voluntarily agreed to end your employment by signing a settlement agreement, the UWV may consider this a benadelingshandeling (detrimental action). This means you voluntarily gave up your employer's obligation to continue paying your salary. The UWV can impose a sanction, which typically means a permanent reduction of your sickness benefit by a percentage, or in severe cases, a complete refusal of the benefit.

Loss of reintegration support

During your employment, your employer has a legal obligation to support your reintegration, including arranging a company doctor, creating a plan of action, and offering adapted or alternative work. Once your employment ends, these obligations cease. The UWV takes over some responsibilities, but the support is generally less intensive than what your employer is required to provide.

Risks of agreeing to dismissal while ill

To fully understand why agreeing to end your employment during sick leave is so risky, consider the following concrete consequences:

• Financial loss: you lose up to two years of continued salary payment (at least 70% of your salary, often 100% in the first year under many collective labour agreements). Depending on your salary and the stage of your illness, this can amount to tens of thousands of euros.
• Sickness benefits instead of unemployment benefits: if you are still ill at the time your employment ends, you are not available for the labour market, which means you cannot receive unemployment benefits (WW). You would need to apply for sickness benefits instead, which may be refused or reduced as described above. If you have recovered by the termination date, you may be able to apply for unemployment benefits.
• Impact on WIA assessment: after two years of illness, the UWV assesses whether you are entitled to disability benefits (WIA). The reintegration efforts during those two years are part of this assessment. If your employment ended prematurely through a settlement agreement, the reintegration history may be incomplete, which could affect your WIA assessment.
• Weaker negotiating position perceived incorrectly: many employees believe their position is weak because they are ill. In reality, the opposite is true. Because the dismissal ban protects you, your employer cannot dismiss you unilaterally. This means your employer needs your cooperation, which gives you significant leverage in negotiations.
• Irreversible decision: once you sign and the 14-day cooling-off period has expired, the agreement is final. You cannot undo the consequences, even if your health deteriorates further.

There are, however, situations in which signing a settlement agreement during illness can be appropriate. For example, if you have almost fully recovered and expect to return to work soon, or if the working relationship has become so toxic that continued employment is detrimental to your recovery. In such cases, the settlement agreement must be carefully drafted, with adequate compensation that accounts for the salary you are giving up, a realistic end date, and provisions that protect your benefit rights.

What happens after two years of illness

Once the two-year period of illness has elapsed (or longer if the UWV has imposed a wage sanction, extending the period to a maximum of 156 weeks), the situation changes fundamentally. The dismissal ban expires, and your employer can apply to the UWV for permission to terminate your employment on the ground of long-term incapacity for work.

UWV dismissal permission

The UWV will assess whether your employer has met all obligations under the Gatekeeper Improvement Act and whether there is genuinely no prospect of recovery or suitable alternative work within the organisation. If the UWV grants permission, your employer can terminate your contract with due observance of the notice period. Even in this situation, you are entitled to the statutory severance pay.

WIA assessment

Around the end of the two-year period, the UWV conducts a WIA assessment (Wet werk en inkomen naar arbeidsvermogen) to determine whether you are entitled to disability benefits. The WIA distinguishes between:

• IVA (Inkomensvoorziening Volledig Arbeidsongeschikten): for employees who are fully and permanently incapacitated for work. The benefit is 75% of the daily wage, without a time limit.
• WGA (Werkhervatting Gedeeltelijk Arbeidsgeschikten): for employees who are partially or temporarily incapacitated. The benefit amount and duration depend on the degree of incapacity and your earning capacity.

If you are assessed as less than 35% incapacitated, you do not qualify for WIA benefits. In that case, you may be entitled to unemployment benefits if you are available for work.

Settlement agreement after two years

Many employers prefer to offer a settlement agreement after two years rather than going through the UWV procedure. In this scenario, the risks are different from signing during the first two years. Since the dismissal ban has expired and the employer could obtain UWV permission, your negotiating position is different. However, you should still ensure the agreement includes the statutory severance pay, accounts for the notice period, and does not jeopardise your WIA or WW rights.

Your options when facing dismissal during sick leave

If your employer is pushing for the end of your employment while you are on sick leave, you have several options. Understanding these options helps you make an informed decision.

Option 1: Refuse the settlement agreement

You are never obliged to sign a settlement agreement. If you refuse, your employer cannot dismiss you during the first two years of your illness (barring the exceptions described above). Your salary continues, and your employer must continue supporting your reintegration. This is often the safest option, particularly in the early stages of your illness.

Option 2: Negotiate better terms

If there are reasons why you might want to leave (for example, a severely disrupted working relationship that hinders your recovery), you can negotiate the terms of the settlement agreement. Given the strong protection you enjoy, you are in a position to demand significantly better terms, including compensation that reflects the salary and benefits you are giving up. A lawyer can help you assess what is reasonable in your situation and negotiate on your behalf.

Option 3: Focus on reintegration

Instead of engaging with the settlement agreement, you can focus entirely on your recovery and reintegration. Your employer is legally required to facilitate this process. If your employer is not fulfilling their reintegration obligations, you can report this to the UWV, which may intervene or impose sanctions on your employer.

Option 4: Seek legal advice immediately

Regardless of which option you are considering, seeking legal advice as early as possible is crucial. An employment lawyer can assess your specific situation, explain your rights, evaluate any offer from your employer, and help you avoid costly mistakes. At OntslagLegal, you can upload your settlement agreement for a free review by our lawyers.

Frequently asked questions about dismissal during sick leave

Can my employer fire me while I am on sick leave?

No, in most cases your employer cannot dismiss you during the first two years of your illness. This is prohibited by Article 7:670 BW. There are limited exceptions, such as dismissal during the probationary period, summary dismissal for an urgent reason, or after the two-year protection period has ended. Outside these exceptions, the ban is absolute.

What if my employer offers me a settlement agreement while I am ill?

You are never obliged to sign a settlement agreement, and this is especially true when you are on sick leave. Signing can mean losing your right to continued salary payment, risking your sickness benefits, and giving up reintegration support. Always have the agreement reviewed by a lawyer before making a decision. You can upload your agreement for a free check.

Can I be dismissed after two years of sick leave?

Yes. After two years of continuous illness, the dismissal ban expires. Your employer can then apply to the UWV for permission to terminate your employment on the ground of long-term incapacity for work. However, your employer must still pay you the statutory severance pay and must observe the applicable notice period.

What happens to my salary when I am on sick leave?

Your employer must continue paying at least 70% of your salary during the first two years of your illness (Article 7:629 BW), subject to the statutory maximum daily wage (maximum dagloon). In the first year, the payment cannot fall below the minimum wage. Many collective labour agreements require 100% payment in the first year and 70% in the second. Read more about sick pay in the Netherlands.

Can I be dismissed for refusing to cooperate with reintegration?

Not immediately. Your employer must first follow a graduated approach: issuing written warnings, stopping salary payments as a sanction (Article 7:629 paragraph 3 BW), and preferably requesting an expert opinion from the UWV. Only after sufficient documentation of persistent refusal, and after exhausting all other measures, can the employer file for dissolution of the employment contract with the subdistrict court. Summary dismissal for reintegration refusal alone is exceptional.

Does the dismissal ban apply to temporary contracts?

The dismissal ban prevents your employer from terminating a temporary contract early. However, it does not prevent the contract from expiring on its agreed end date. If you have a fixed-term contract that reaches its end date while you are ill, the contract simply ends. You may then be eligible for sickness benefits (Ziektewet) from the UWV.