A Dutch District Court of The Hague ruling (ECLI:NL:RBDHA:2026:1975) confirmed that dismissing an employee after two years of illness without UWV approval violates Dutch employment law.
The employer received no additional compensation because the financial outcome would’ve been identical.
The case proves procedural compliance is required in the Netherlands employment system, not optional.
Small businesses face disproportionate risk because procedural shortcuts expose them to unpredictable financial liability.
What You Need to Know
- UWV approval is legally mandatory when dismissing employees after two years of illness in the Netherlands.
- Procedural violations don’t automatically trigger financial penalties. Courts assess financial damages on a case-by-case basis.
- Successor employer status multiplies severance liabilities when you restructure business entities.
- The quality of documentation directly determines financial exposure in Dutch employment disputes.
- The two-year illness mark creates a convergence point where multiple obligations collide, increasing the risk of procedural mistakes.
Small business owners in the Netherlands repeatedly make the same calculation. An employee hits the two-year illness mark. Wage obligations end. The dismissal seems inevitable. The UWV approval feels like a formality confirming what everyone already knows.
So they skip it.
A recent District Court of The Hague ruling (ECLI:NL:RBDHA:2026:1975) shows what that shortcut costs. The employer dismissed an employee after two years of illness without obtaining mandatory UWV approval. The court recognized the procedural violation. Then it set the additional fair compensation at zero euros.
Zero euros.
The employer still lost the case. The procedural violation still happened. The court still ruled against them. They got lucky on the financial outcome because of particular timing factors that won’t repeat reliably.
This is the mechanism that makes Dutch employment law dangerous for small businesses: Procedural compliance protects you even when outcomes seem obvious. Procedural shortcuts expose you even when you think you’ll win.
Bottom line: Dutch employment law enforces procedural integrity regardless of the predictability of the outcome. The zero-euro compensation doesn’t justify shortcuts. The ruling reveals fact-specific luck.
What Happens at the Two-Year Illness Mark?
The two-year illness period creates a pressure point. Multiple obligations collide here.
Your wage payment duty ends after 104 weeks. Dutch law requires at least 70% wage continuation for the full period. For micro-businesses operating on tight margins, this is a continuous financial commitment testing cash flow planning.
Dismissal becomes legally possible. Not automatic.
UWV approval becomes mandatory. This isn’t administrative courtesy. It’s a legal requirement to determine whether your dismissal is valid.
The reintegration documentation standard determines your exposure. If you don’t prove you did everything possible to support the employee’s return to work, the UWV imposes a wage sanction requiring you to continue payments for up to another year.
Founders make expensive mistakes here. The two-year mark feels like relief. The economic drain stops. That emotional shift creates procedural blindness.
You stop seeing the narrow window in which a missed step converts a manageable dismissal into unpredictable liability.
Key point: The two-year illness mark is when procedural discipline matters most, because wage relief creates a false sense of security.
What Did the Court Rule About Procedural Violations?
In this case, the employer terminated the employee without UWV approval. The court confirmed this violated Dutch employment law.
The employee claimed additional fair compensation beyond the standard transition payment. The legal argument was direct: the employer skipped a mandatory procedure, and the violation should trigger financial consequences.
The court agreed on the violation. Then it assessed actual financial damage.
Here’s the mechanism saving this employer: After two years of illness, wage payment obligations had ended. If the employer had followed the correct UWV approval process, the employee wouldn’t have received additional salary during the administrative period. The financial outcome would’ve been identical.
No additional damage meant no additional compensation.
The outcome was fact-specific. Different timing, incomplete reintegration records, or variations in medical assessments shift the result toward substantial penalties or months of extra wage costs.
The court didn’t excuse the procedural shortcut. It landed in circumstances where the shortcut didn’t create measurable financial harm.
Key point: Courts confirm procedural violations even when awarding zero compensation. The ruling validates the violation, not the shortcut.
How Does Successor Employer Status Multiply Severance Liability?
The ruling confirmed something that caught restructured businesses off guard: Transition payment calculations must include prior employment periods if successor-employer status applies.
This matters for small businesses evolving through entity changes.
You move operations between BVs. You restructure partnerships. You consolidate activities under a new legal entity. These feel like normal business evolution.
Dutch employment law sees continuity.
If an employee worked in comparable work within the same organizational structure, those earlier years count toward severance calculations. What seemed like a two-year liability turns into four, six, or more years.
Since January 1, 2020, transition payments apply from day one of employment. The 24-month threshold was removed. This eliminates the grace period and increases cumulative severance liabilities across all contract types.
For 2026, the maximum transition payment caps at €102,000 or the annual salary, whichever is higher, if the annual salary exceeds the threshold. For micro-businesses, this is a cash flow event threatening operational soundness.
Starting July 1, 2026, UWV compensation for transition payments after two years of illness will be restricted to small employers with around 25 employees. Medium and large employers lose that reimbursement.
This creates a compliance advantage for the smallest businesses. If you’re slightly above the threshold, you absorb the full cost without relief.
Key point: Successor-employer status converts what appears to be short-term severance into a long-term liability. Entity restructuring requires legal review before execution.
Why Does Record Quality Determine Financial Exposure?
The burden of proof in Dutch employment disputes falls on employers.
You must demonstrate that you followed proper reintegration procedures. You must show you did everything possible to support the employee’s return to work. You must produce complete records of medical assessments, timeline tracking, and intervention attempts.
If you don’t prove it, the system assumes you didn’t do it.
The UWV imposes a wage sanction if reintegration responsibilities aren’t fulfilled. The sanction requires you to continue wage payments for up to an additional year. The prohibition on giving notice extends, providing longer protection against dismissal.
This transforms the documentation standard from administrative overhead into direct financial exposure.
Small businesses without dedicated HR functions face asymmetric risk. Employees claim procedural violations relatively easily. Employers must produce evidence of compliance under pressure.
One missing reintegration report. One incomplete medical assessment record. One gap in timeline documentation.
That’s where control leaks.
Key point: Employers carry the burden of proof in Dutch employment law. Missing documentation equals presumed non-compliance.
Why Does Dutch Law Prioritize Process Over Outcomes?
This ruling reveals a fundamental characteristic of the Netherlands employment system.
The system enforces procedural integrity even when substantive results seem inevitable. Unlike common law jurisdictions, which focus primarily on harm, the Dutch framework treats proper procedure as employee protection.
For foreign entrepreneurs, this represents a shift in cultural and legal mindsets.
Compliance demonstrates respect for the system. Not fear of penalties. The process protects both parties by creating clear decision points, documented reasoning, and independent review.
You might know the UWV will approve the dismissal. You might be certain the outcome is predetermined. Certainty doesn’t excuse skipping the procedure.
The procedure exists to prevent power imbalances, ensure medical assessment independence, and create a record for review in the event of disputes.
When you skip the procedure, you signal that you favor efficiency over structural strength. The system punishes this signal even when the outcome wouldn’t have changed.
Key point: Dutch employment law treats procedural protections as substantive, not merely formal. Outcome certainty doesn’t justify procedural shortcuts.
What Control Points Reduce Exposure Before the Two-Year Mark?
To manage illness-related dismissal risk, install these controls before the pressure hits:
1. Document every reintegration attempt with dates and outcomes.
Don’t rely on memory or informal conversations. Create a reintegration file tracking medical assessments, suggested adjustments, employee responses, and timeline milestones. This file becomes your defense if the UWV questions your efforts.
2. Assign one person to own reintegration coordination.
Fragmented responsibility creates recording gaps. One owner ensures continuity, tracks deadlines, and retains the evidence trail.
3. Schedule UWV approval requests before the two-year mark hits.
Don’t wait until day 730. Build in extra time. The approval process takes weeks. If you submit late, you unnecessarily extend wage obligations.
4. Review successor employer status before any entity restructuring.
If you’re moving operations between BVs or consolidating activities, get legal confirmation on whether continuity applies. The assessment determines whether you’re calculating severance over 2 or 10 years.
5. Track the July 2026 UWV compensation threshold.
If you’re near the 25-employee mark, understand whether you qualify for transition payment reimbursement. This significantly changes your cash flow planning.
6. Treat the two-year illness period as a planning milestone, not a relief point.
The moment wage obligations end is when procedural discipline matters most. Install a calendar trigger that automatically prompts UWV for approval requests.
Key point: Effective risk management starts before the two-year mark. Reactive compliance creates exposure.
Why Do Small Businesses Face Disproportionate Risk?
Dutch employment law applies the same process guidelines regardless of employer size.
A multinational with dedicated legal and HR teams absorbs occasional penalties as operating expenses. They have systems, templates, and specialists managing compliance as a full-time function.
A micro-business with five employees operates on tighter margins. One unexpected severance liability threatens viability. One wage sanction extension disrupts cash flow for months.
The system doesn’t adjust for scale. It doesn’t offer simplified procedures for smaller operators. It doesn’t reduce record-keeping requirements based on headcount.
This creates disproportionate compliance burdens for businesses lacking dedicated resources. You’re running operations, managing clients, handling finances, and handling employment law simultaneously.
Overload creates blind spots. You miss deadlines. You skip steps that seem minor. You rely on assumptions instead of verification.
The two-year illness dismissal procedure is where that pattern becomes expensive. The stakes are high. The timeline is narrow. The record-keeping requirements are detailed.
Professional guidance becomes more critical for smaller operators, not less.
Key point: Dutch employment law doesn’t scale for business size. Small businesses absorb a disproportionate compliance burden relative to resources.
What’s the Real Lesson From This Ruling?
This court ruling doesn’t prove procedural shortcuts are safe if outcomes seem obvious.
The ruling proves procedural shortcuts expose you to unpredictable risk. Sometimes you get lucky with monetary results because of factors you can’t control or replicate.
The employer in this case avoided a financial penalty. They still lost the legal argument. They still violated Dutch employment law. They still faced court proceedings, legal costs, and reputational exposure.
They landed in circumstances where the violation didn’t create measurable damage.
That’s not a strategy. That’s luck.
Structure is what remains when luck runs out. Structure protects you when timing shifts, when record gaps appear, when medical assessments vary, and when employees contest assumptions.
If you don’t prove you followed the procedure, you don’t control the outcome. The system controls what happens. The system favors process over your certainty about results.
UWV approval isn’t optional bureaucracy. It’s the price of staying in control when the two-year mark of the illness arrives.
Key point: Structure beats luck. Procedural compliance is risk management, not bureaucratic compliance.
Frequently Asked Questions
Is UWV approval required for all employee dismissals in the Netherlands?
No. UWV approval is mandatory when dismissing employees after two years of illness. Other dismissal grounds have different procedures and requirements.
What happens if I dismiss an employee without UWV approval?
The dismissal violates Dutch employment law. Courts assess actual financial damage to determine compensation. You face legal costs, reputational exposure, and potential wage sanctions regardless of financial penalty outcomes.
How long does the UWV approval process take?
The approval process takes several weeks. Submit requests before the two-year mark of illness to avoid unnecessarily extending wage obligations.
What is successor employer status?
Successor employer status applies when an employee’s work continues under a new legal entity within the same organizational structure. Previous employment periods count toward severance calculations, multiplying transition payment liabilities.
What reintegration documentation do I need?
You need medical assessments, timeline tracking, suggested adjustments, employee responses, and intervention attempts. The burden of proof falls on employers. Missing documentation equals presumed non-compliance.
Do small businesses get simplified compliance procedures?
No. Dutch employment law applies the same process standards regardless of employer size. Small businesses face disproportionate compliance burdens relative to resources.
What is the wage sanction penalty?
If you don’t fulfill reintegration responsibilities, the UWV imposes a wage sanction requiring you to continue wage payments for up to an additional year. The prohibition on giving notice extends.
When does the July 2026 UWV compensation change take effect?
Starting July 1, 2026, UWV compensation for transition payments after two years of illness will be restricted to small employers with around 25 employees. Medium and large employers lose that reimbursement.
Key Takeaways
- UWV approval after two years of illness is legally mandatory in the Netherlands, not optional bureaucratic red tape. Procedural shortcuts expose you to unpredictable financial liability.
- Dutch courts confirm procedural violations even when awarding zero compensation. The ECLI:NL:RBDHA:2026:1975 ruling validates the violation, not the shortcut.
- Successor employer status multiplies severance liabilities. Entity restructuring requires legal review to determine if previous employment periods count toward transition payments.
- Employers carry the burden of proof in Dutch employment disputes. Missing reintegration documentation equals presumed non-compliance and triggers wage sanctions.
- The two-year illness mark poses the greatest procedural risk because wage relief creates a false sense of security. Install controls before the pressure hits.
- Dutch employment law doesn’t scale for business size. Small businesses bear a disproportionate compliance burden relative to their resources, making professional guidance essential.
- Structure beats luck. Procedural compliance is risk management that protects you when timing shifts, record gaps appear, or employees contest assumptions.
