Integrity at DAG!
This blog aims to give you a few examples of the integrity measures DAG had built in its daily work method.
The Act on Advocates prescribes a binding code of conduct for all lawyers operating in The Netherlands. Amongst the many rules, a few are worth mentioning here:
The Act on Advocates prescribes a binding code of conduct for all lawyers operating in The Netherlands. Amongst the many rules, confidentiality is a fundamental rule. Any information related to your legal issue is confidential. This rule is actively maintained by lawyers in The Netherlands. It is of utmost importance for you as a client to be able to rely on secrecy in your relationship with your lawyer. The confidentiality obligation is comprehensive. Not only does it cover confidentiality regarding any details of a case, it even prohibits a lawyer from disclosing who the client is. This applies to the period of the cases being dealt with, but also after the case is closed. The confidentiality obligation also applies to all working at the law firm. This can only be different if lives are at stake.
Violating this rule may lead to sanctions according to disciplinary law by The Dutch Bar Association, which even go so far that the lawyer can be disbarred.
According to The Act on Advocates and according to the detailed code of conduct of The Dutch Bar Association, all work you pay for should be accounted for. Therefore, you will receive a specified bill that provides a full insight of the work that is being charged. Any disputes concerning the bill can be taken up with The Dutch Bar Association’s Disciplinary Board.
A famous saying in Dutch is “two know more than one”. That is why DAG works in small teams, to make sure your interests are optimally represented. This means most steps in handling your legal issue by your lawyer, whether it may be a strategic outline or a letter going to the opponent, is reviewed by a colleague. It is a safeguard to maintain our high standards of quality of service.
The Act of Advocates laid down five core values in article 10a:
- Independence: The legal system demands independence of its lawyers in order to ensure a fair and just administration of justice.
- Partiality: The lawyer only advocates what is in the best interests of his client. A conflict of interests has to be avoided.
- Professionality: The lawyer needs to have certain skill and knowledge levels.
- Integrity: The profession demands ethical standards in order to uphold the trust clients have in lawyers.
- Confidentiality: See above.
These core values are enforced by The Dutch Bar Association. The Disciplinary Board of the Bar has the prerogative to impose measures and punishments to a lawyer violating these core values and the Act of Advocates in general.
Every legal expert at DAG is able to tell more about the way we maintain our integrity and is willing to answer all questions on this subject.
The 30% ruling and amendments in the ruling
Both employers and employees benefit from a good understanding of the tax benefits for expats. The 30% ruling is an essential tax benefit. This article will explain the basics of the ruling and will provide clarity on the amendments of this ruling.
The 30% ruling is a tax benefit that applies to expats who have an employment relationship being executed in The Netherlands. The ruling accommodates a threshold that is excepted from taxation by income tax. That means that the first 30% of your salary will not be taxed at all. The remaining 70% will be taxed. Given the taxation of income by brackets, this ruling will provide a considerable advantage for expats.
Given the impressive tax advantage, it is very well imaginable that the Dutch legislator build in some criteria that need to be met. The first one is that the employment contract was obtained whilst living abroad. The job application needs to have been executed from abroad. The second criterium demands a certain expertise, that is expressed in the salary amount. The remaining taxable incoming above the 30% threshold needs to be at least € 41.954,00 (standard of 2023). If you are a qualified scientist or doctor, the second criterium does not apply. The third requirement is that you lived abroad at least 16 out of 24 months prior to the starting date of your employment contract. Abroad is defined as any location outside the 150 kilometre zone from the Dutch borders.
This tax benefit is granted for five years.
Salary or income is taxed in the so-called Box 1 of the income tax. The 30% ruling gets deducted from your Box 1 taxation. There is another benefit of importance: If the 30% ruling applies to your situation, you get excepted from any taxation in Box 3 as well. Box 3 covers Savings and Investments. Your savings and investments will not be taxed. There are specific requirements for the application of this benefit in Box 3. The amount of savings that is excluded from taxation is maximized at € 57.000,00 (standard of 2023). If you have a partner, that amount is doubled. Savings can be freely allocated between partners.
From the 1st of January 2024, an Act amending the 30% ruling will come into effect. This Act alters the benefits of the 30% ruling. Before the amendment, you could get a 30% threshold benefit for the duration of five years. After the amendment, a tier system applies. You will receives a benefit of 30% for the first twenty months from the start of the employment contract. The successive twenty months will grant you a benefit of 20%. The remaining twenty months will give you an advantage of 10%.
Feel free to contact our specialists with any questions regarding your situation.
Probation period/trial period in employment contracts
The so-called probation period, also known as a trial period, is often part of the Dutch employment contract. This clause raises questions on a regular basis for expats who have not experienced such a clause before or are not aware of the implications of this clause according to Dutch law. Therefore, DAG provides employers and employees a handy overview of the most relevant questions regarding this subject.
The probation period or trial period is a period at the start of a new employment contract for both the employer and employee to assess whether there is a profitable match.. As the name indicates, this period gives both parties the chance to try out the new work relationship. Is there a match in expectations regarding the function? Does the employee fit in the new work environment? Does the employee possess the right capacities to (learn how to) fulfill the function adequately? Is everybody happy? A period of mutual exploration, in a nutshell.
Giving the nature of exploration and trying out whether the match between employee and employer is a success or not, the consequences of the trial period are quite far-reaching. During this period, the employer can decide to terminate the employment contract without a valid reason being required. The employee has the exact same prerogative. No termination period is applicable, so a termination has immediate effect.
Even though no valid reason needs to be provided for the termination of the employment relationship by an employer, there are some considerable restrictions concerning this reason. Discriminating deliberations are prohibited as a ground for the decision to dismiss an employee. Examples of discriminating deliberations can be found in pregnancy, origin, sexual orientation or sex.
Giving the extent of the mutual freedom to end the employment contract at any given moment, it is very well understandable that the legislator restricted the duration of the probation period. The duration of the concerned period depends on the duration of the employement contract as such. An employment contract of six months or less is excluded from the option of a probation period. An employment contract for any period longer than six months is allowed to include a probation period of a month. Contracts with an indefinite duration can incorporate an probation period of two months. Exceeding these legal duration leads to the whole trial period being void.
Yes, there are. The trial period should have the same duration for the employer and employee equally. Deviations towards one party are not allowed. Furthermore, the trial period should always be laid down in writing. Verbal agreements regarding this subject are void. Due to the purpose of getting to know a new employee, there can be restrictions for the employee already known to the employer. These restrictions depend, amongst other factors, on the comparison and similarity between the previous function and the current function.
At DAG we are able to answer all your questions regarding this subject. Our labour law specialists are excellent equipped to scrutinize your employment contract or relation.
Compensation after dismissal
Both employers and employees benefit from knowledge about the legal compensations after dismissal of an employee. DAG explains you the basics.
Mrs. Johnson- Singh* works for a large multinational in Eindhoven. Her employment contract started at the 1st of May of 2020. Mrs. Johnson- Singh is experiencing some difficulties with her superior, mister De Vliet. His sense of humor is demeaning, according to mrs. Johnson- Singh. He tends to make remarks of her ethnicity in a negative way. He often described her home country as a backward bunch of people living between heaps of trash. Mrs. Johnson- Singh addressed the issue several times. Mister De Vliet replied that she should be a sport. He added that he did not say anything that isn’t true. She should be happy that she is finally living in a sophisticated country now, he stated.
Mrs. Johnson- Singh felt she was being judged on her ethnicity and that mister De Vliet’s biases about her home country influenced his opinion of her merits. She achieved her yearly goals consistently, yet was denied a promotion. When asked for an explanation, mister De Vliet replied that she should be grateful she is not working in a tea stall as she would in her home country. Mrs. Johnson- Singh snaps. The many years of tolerating the demeaning remarks result in a rant. Subsequently, mister De Vliet decides to dismiss mrs. Johnson- Singh, taking the notice period in account, on the ground of a disturbed working relationship. Per 1st of November 2023, her employment contract will be terminated.
Mrs. Johnson- Singh does not want the employment contract to be repaired. She asks DAG to assist her in getting the compensation she is entitled to. DAG has negotiated for mrs. Johnson- Singh and achieved satisfying results for her.
The legal expert at DAG makes an thorough analysis of the situation and assesses the legal position cases like that of mrs. Johnson- Singh. Our lawyers will explain to you whether you qualify for a transition compensation and how much that will be.
The transition compensation is a legal compensation for the employee after dismissal. The amount corresponds with the duration of the employment contract. The most recent gross monthly salary is used for the calculation. For each completed year calculated from the start of the employment contract, a third of a monthly salary is granted to the employee. The remaining months are calculated according to the formula:
(gross salary over the remaining months/ gross monthly salary) x (1/3 gross monthly salary/12).
For example, if you complete three full years and seven months and your most recent salary was € 4,500.00, that will add up to the following calculation. For the three completed years you will receive three times a third of your monthly salary. That is € 4,500.00. The remaining seven months result to the following formula: (€ 31,500.00/ € 4,500.00) x ( € 1,500.00/12) = 7 x 125 = € 875.00. The transition compensation is € 4,500.00 + € 875.00 = € 5,375.00.
The transition compensation is a legal right, so the employer is obliged to pay this amount to the employee.
In case there are culpable circumstances which have led to the dismissal an option for an additional compensation comes to mind. In case of seriously culpable conduct by the employer, the employee could demand a so-called reasonable compensation. This reasonable compensation does not have a fixed formula. The amount of the reasonable compensation depends on the extent of the culpability. The amount can be agreed upon in negotiations or decided by a court ruling.
The reasonable compensation you can receive, needs to be decided in either negotiations or in court. The amount is not very easy to predict. Jurisprudence on this matter is highly depended on the circumstances of each specific case and does not provide enough general indications to hold on to in this regard. At DAG, we are specialised in negotiating for a maximum reasonable compensation. In case this does not work out, we are also experts at serving your interests in court.
The aforementioned two compensations do not cover the whole array of possibilities for employees. The lawyers at DAG can take many more elements into account for the settlement agreement.
The specialists at DAG are highly suited to help you out with any legal issue regarding your employment contract. Feel free to discuss your questions with us over a cup of coffee.
Notification of fixed-term employment contracts
When it comes to fixed-term employment contracts, there is one specific legal obligation that needs to be taken in consideration: the notification. This article will elaborate on the legal obligations for the employer and the legal rights of the employee.
A fixed-term employment contract is defined by termination after fulfilment of the fixed-term mentioned in the employment contract. The concerning contract ends by operation of law. No notice nor notice period is required.
As the end of the fixed-term employment contract approaches, it is important for both parties to decide if and how they want to continue their employment relationship. The notification entails a written statement of the employer whether he wants to prolong the fixed-term employment contract or not. This gives clarity to the employee, who is depending on the employment contract. Not only for his livelihood, but in case of an expat, also for his or her work visa.
Mind you, this is not the same notice as applicable when terminating an indefinite employment contract. The notification of a fixed-term employment contract as meant here is called “aanzegging” in Dutch, while the notice of an indefinite employment contract is known as “opzegging”.
If the fixed-term employment contract has a duration of at least six months, the obligation of a notification is applicable.
The employer needs to inform the employee a month before the end of the fixed-term employment contract whether the former wants to continue the employment relationship with the latter. In case of continuation, the employer also needs to hand over the conditions of the successive employment contract in writing with the notification.
What if the employer sends the notification too late? In that case, a fine is also owed by the employer. The fine is decided by the period that exceeds the deadline of the notification. For instance, if the employer sends the notification to the employee a week later than obliged, the fine owed to the employee will be a week’s salary.
What if the employer does not send a notification at all? In case of an employment contract with a fixed number of working hours, the employer will have to pay a fine of a full month’s salary to the employee. In case there is no fixed number of working hours, the rules concerning the fine differ depending on the specific situation.
What if the employer does not send a notification at all and does not hand over the conditions of a successive employment contract, yet the employee continues to work after the previous contract has ended by operation of law? In this case, the employment contract will be prolonged by operation of law for the same fixed-term as the previous fixed-term employment contract, although limited to a maximum of a year. The same conditions of the previous fixed-term employment contract are applicable to the successive fixed-term employment contract as well.
The notification has strict obligations and far-reaching consequences. Therefore, it is important to make sure you live up to the obligations as an employer or are aware of your rights as an employee. Apart from the legal implications, there might also be an applicable collective labour agreement entailing consequences concerning this subject. You are more welcome to contact one of our employment experts in case you have any questions.
Rental agreements for expats
Although this article is written from the perspective of a tenant, it contains very useful information for landlords as well.
Mister Sharma*, an IT-professional working in Amstelveen, contacted DAG regarding some doubts he had about his rental agreement. There was no legal conflict as such, but he wanted to have the draft of the agreement checked by a legal expert before signing it. He also had some questions regarding the legal consequences of some clauses in the contract.
It turned out his suspicions where anything but baseless. Quite some breaches of the law were present in the rental agreement with extensive, negative financial reprecussions for mister Sharma in the future. A letter was written by DAG to his landlord, demanding compliance with the law, and thus protecting the rights by Dutch law of mister Sharma as a tenant. The case was succesfully closed after negotiations in advantage of mr. Sharma.
Given how often expats become the disadvantaged party in tenancy issues, DAG provides you with some basics on the rights of tenants in expat rental agreements.
On the 1st of July 2023, the Good Landlordship Act came to effect. This law has been made specifically to protect tenants against malpratice by landlords. Amongst the many obligations and prohibitions for landlords are:
– The landlord is not allowed to discriminate his tenants. To safeguard a transparant selection procedure, neutral selection criteria should be laid down in writing. These criteria should be available publicly and should be lived up to. If the landlord hires a broker, the broker should live up to the aforementioned criteria as well. The choice for a specific candidate should be explained to the rejected candidates.
– Intimidation of tenants in any form is prohibited. Even though intimidation is already prohibited by the Dutch Code of Criminal Law, the legislator wanted to emphasize this by laying it down specifically in this Act as well.
– The deposit asked by the landlord may not exceed the amount of two months of rent. In daily practice, we often see far higher amounts being demanded as a deposit. This is obviously illegal and can be challenged.
The rules mentioned above apply to all tenants. For expats specifically, the following rules are applicable as well:
– It is not allowed to connect the employment contract to the rental contract. This prevents the rental agreement from being ended as soon as the employment is ended.
– The tenant should be informed in writing on his rights and obligations of the rental agreement in a language well known to the tenants. Even though the agreement itself can be in Dutch, the information should be in the language of preference of the tenant. This also applies to existing rental agreements signed before the 1st of July 2023.
– The city council may impose permit requirements to landlords letting premises to expats. The requirements that should be met in order to obtain a permit can cover different categories. One of those categories may include the available facilities in the premises provided by the landlord.
The council of mayor and aldermen of your municipality can punish breaching the The Good Landlordship Act in several ways. Fines can be given upto € 90.000,00. Administrative coercion is another option to force the landlord to comply. In case the landlord persists in illegal malpractice, the management of the premises can be taken over by the municipality. DAG can help you by submitting a request to the municipality to have these sanctions imposed.
Do you want to have your rental agreement examined? Does your landlord breach your rights as a tenant? Is there a legal conflict with your landlord? Do not hesitate to start a non-committal conversation with one of our legal experts.