As most of you are aware, employment law underwent significant changes in 2015 following the entry into force of the Work and Security Act (WWZ). Although these changes have only been in force for a few years, it appears that further changes to employment law are on the horizon. This time, they are known as the Balanced Labour Market Act (WAB).
WAB adopted
The WAB Bill was passed by the House of Representatives on 5 February and is yet to be submitted to the Senate. The Bill is therefore not yet final, but the intention is for the new measures to come into force on 1 January 2020.
The changes
In short, the changes are as follows:
- The limit on the number of consecutive fixed-term contracts is being extended from 3 fixed-term contracts in 2 years to 3 fixed-term contracts in 3 years (this was already the case before the WWZ came into force in 2015);
- Employers will be required to make an annual offer of fixed hours to on-call workers (zero-hour and min-max contracts). This offer must be based on the average number of hours worked over the previous twelve months;
- Employers are required to give on-call workers at least four days’ notice;
- The rate of the unemployment benefit contribution will be lower for employers in respect of employees on permanent contracts. Conversely, the unemployment benefit contribution will be higher for employees on flexible contracts;
- Employees are entitled to the transition payment from their first day of work, including during the probationary period (previously, this was only after two years’ service);
- The calculation of the amount of the transition payment will in future be based on the actual duration of the contract and therefore no longer on full half-years of service (as a result, the amount of the payment will, on balance, increase in certain situations compared with the current legislation);
- Under current legislation, employees with more than 10 years’ service are entitled to a higher transition payment. This scheme is to be abolished. The calculation will be the same for every employee, regardless of the number of years’ service;
- It will soon be possible once again to dismiss an employee on the basis of multiple grounds for dismissal. Under current legislation, dismissal was, in principle, only possible on the basis of a single ground for dismissal. The combination of multiple grounds for dismissal will therefore soon be possible again, making it easier for employers to dismiss employees (this was also the case before the WWZ came into force in 2015). However, this is offset by a potentially higher transition payment (up to 50%);
- Payroll companies will soon no longer be permitted to apply a temporary employment clause or a more lenient chain provision (more than three temporary contracts). Payroll employees will also be entitled to the same terms and conditions of employment as employees directly employed by the employer;
- A scheme is to be introduced for small employers to compensate for the transition payment if the business has to be wound up due to the employer’s retirement, illness or disability, or death.
As you can see, a number of legislative changes introduced by the WWZ have been reversed, in other words, restored to the way they were more or less applied before the WWZ came into force. However, there are also a number of new regulations which will entail changes to HR policy for every employer.