How much severance pay will I get in the Netherlands?

Severance pay (transitievergoeding) under Dutch law amounts to 1/3 of your monthly salary for each year you've worked for your employer. You're entitled to this payment when dismissed by your employer, except in cases of summary dismissal for urgent cause. It's important to know your rights so you can verify that your employer pays the correct amount.

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The short answer

Severance pay (transitievergoeding) in the Netherlands is 1/3 of your gross monthly salary multiplied by the number of years you've worked for your employer. This applies to all employees with an employment contract, regardless of whether you have a permanent or temporary contract. You only receive this payment when your contract is terminated by the employer. With summary dismissal for urgent cause, you have no right to severance pay. You also don't receive this payment if you resign yourself.

What does Dutch law say?

Severance pay is regulated in Article 7:673 BW (Dutch Civil Code). This regulation has applied to all employees since 1 July 2015. Dutch law states that every employee is entitled to this payment when their employment contract is terminated by the employer. It doesn't matter whether you have a permanent or temporary contract, or why your employer terminates the contract.

1Article 7:673 BW (Dutch Civil Code) regulates severance pay

2The regulation has applied since 1 July 2015

3All employees are entitled to it when dismissed by their employer

What should you watch out for?

Pay careful attention to how your monthly salary is calculated - allowances and variable components also count. For partial years of employment, you receive a proportional amount of the payment. Severance pay is taxable in the Netherlands, so you receive the amount minus payroll tax. Your employer must pay the severance pay when your employment ends.

1Check that all salary components have been included

2For less than a year of work, you get a proportional amount

3The payment is taxable income in the Netherlands

4Employer must pay when employment ends

Practical example

Suppose you earn €3,000 gross per month and have worked for your employer for 6 years. Then you receive severance pay of €6,000 (€3,000 ÷ 3 × 6 years). If you've worked for 2.5 years, you get €2,500 (€3,000 ÷ 3 × 2.5 years). With a monthly salary of €4,500 and 4 years of service, this becomes €6,000 (€4,500 ÷ 3 × 4 years). Note: you still pay payroll tax on this amount under Dutch law, so the net amount you receive is lower.

What can you do?

If you're dismissed in the Netherlands, you can take concrete steps to secure your severance pay (transitievergoeding).

1Calculate your severance pay yourself to verify the amount

2Ask your employer for written confirmation of the amount

3Contact a legal adviser if your employer refuses to pay

Conclusion

As an expat in the Netherlands, you're entitled to 1/3 monthly salary per year worked as severance pay (transitievergoeding) when dismissed. This applies in all cases under Dutch law, except for summary dismissal or when you resign yourself. Always verify that your employer calculates and pays the correct amount.

Frequently Asked Questions

Do I also get severance pay if I resign myself?

What if I'm dismissed for urgent cause?

Does my 13th month also count for the calculation?

Must my employer pay the severance pay immediately?

What if my temporary contract expires?

Do I get severance pay during a reorganisation?

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