Summary Dismissals in the Netherlands: Why Time Is of the Essence

As sometimes happens in the workplace, an employee may no longer be considered fit to perform their duties because they have violated the standards of good employee conduct. These infringements include theft, fraud, threats and violence – but also refusal to work without good reason.

Summary dismissals were created to allow the employer to dismiss an employee at the shortest possible notice in case of transgression. The employer still faces an obligation to make the summary dismissal plausible, however. Among other things, there must be an urgent reason for anyone to be “fired instantly” – proving such is not an easy requirement for the employer to meet.

Article 7:677(1) of the Dutch Civil Code (Burgerlijk Wetboek) states that, in order to terminate an employment contract with immediate effect, employers and employees alike must provide urgent reasons and notify the other party of such reason without delay. An employer is expected to conduct the instant dismissal with due diligence and, as per good employment practice, to exercise due care towards an employee.

The “promptness requirement” necessary for a summary dismissal to take place obliges the employer to act expeditiously.

What constitutes promptness depends on the circumstances. A situation where an employee commits theft or threatens another person, for example, demands immediate action from the employer. In cases where they only suspect an urgent reason to dismiss an employee (eg, fraud), however, an employer should seek legal advice and undertake an investigation to prove the fraud before proceeding with instant dismissal.

As the following cases illustrate, the employer should not wait “too long” before conducting an investigation or they will fail to meet the promptness requirement and the summary dismissal will be invalid as a result.

The Rotterdam District Court judgment of 13 September 2022 showcases how the promptness requirement should be applied.

The case involved an employee who, in his position as finance director of Rotterdam Rail Feeding (RRF), had:

Following the investigation, RRF summarily dismissed the employee. It also claimed liquidated damages under Article 7:677(2) of the Dutch Civil Code on the grounds that deliberate or culpable conduct on the part of the employee forced RRF to terminate his employment contract.

The employee successfully challenged the claimed damages, however. The Rotterdam District Court held that the promptness requirement had not been met in this instance, as the investigation launched by RRF was not carried out with due diligence. It took nine months to complete and, thus, the “instant” dismissal was also only given after nine months.

The reasons for the delay were not strong enough for the court. They included “busyness on the part of RRF employees, holidays and illness (both of employees and investigators), and receiving data dumps that took a lot of time to decipher”.

The investigation was not conducted promptly in this case, given that – although it began in May 2021 – the relevant email messages were only shared with  investigators in late August and mid-October 2021 and interviews did not take place until October 2021. This delay was the fault (and at the risk) of the employer.

A case that appeared before the Gerechtshof 's-Hertogenbosch Court of Appeal on 13 October 2022 similarly failed to meet the promptness requirement for summary dismissal.  However, in this instance, the employee was nevertheless found to be in the wrong.

The employee in question regularly failed to appear at work without cancelling. The employee subsequently indicated several times that he could not come to work and the employer subsequently reported employee’s sickness. The occupational health and safety service tried to contact employee, but to no avail.

The employer sent a letter to employee on 17 November 2021 to give him one last chance to appear at work on 22 November 2021. The employee failed to appear at work on this date, in addition to a subsequent unauthorised absence on 6 December 2021. On 8 December 2021, the employer sent the employee a letter dismissing him for not appearing at work for several months.

The court held that employer did not give notice without delay, based on the fact that the employer summarily dismissed the employee on 8 December 2021 despite already giving him one last chance to attend work on 22 November 2021. However, the court held that employee had acted in a seriously culpable manner – that is, by failing to perform work – and that employee was not entitled to transitional compensation as a result. According to the court of appeal, the employee’s seriously culpable conduct far outweighed the employer’s failure to meet the promptness requirement for giving instant dismissal.

What is important in this case is that the employee could still have prevented the dismissal had he responded to the employer’s final attempt. Consequently, the court found that the employer does not have to pay fair compensation to employee.

Case law has established guidelines on what to take into account when considering whether a summary dismissal was immediate. Relevant factors include:

Nevertheless, it is often only possible to determine whether immediate action has been taken based on the circumstances of the case. The relationship between the requirement for promptness and the duty of care taken must be considered in cases of summary dismissal.

Where an urgent reason (ie, grounds for summary dismissal) is suspected, an employer can launch an investigation that allows the veracity of this suspicion to be tested. The investigation ensures that an employee is not unfairly and improperly dismissed with immediate effect on the basis of an incorrect presumption. To this end, the employer must observe a duty of care but also initiate and complete the investigation expeditiously. In other words, the investigation should not take longer than necessary.

When assessing the promptness of the dismissal, it all comes down to an employer’s ability to explain:

Ultimately, in order to defend the summary dismissal, the employer must strike a balance by managing to uphold the diligence of the investigation without unduly compromising the requirement for promptness.