10 Years of Dutch dismissal law WWZ: what have we learned from the ‘new’ rules?

1. Fixed dismissal grounds: can every case be put in a box?

One of the key changes the WWZ introduced was a set list of valid dismissal grounds, each tied to a specific route. For economic reasons or long-term illness, employers must go through the UWV. For personal reasons – such as poor performance, workplace conflict, or culpable behavior – they must go to court.

This brought more structure, but not necessarily more clarity. Not every case fits neatly into a legal box. Sometimes, there’s no perfect performance file, but the working relationship has broken down beyond repair. Still, if the court or UWV finds the case legally insufficient, the dismissal request will be rejected. A weak file can’t be “fixed” in court by paying a higher severance– something that was still possible before the WWZ.

The 2020 Balanced Labour Market Act (WAB) added more flexibility by introducing the "cumulative ground," allowing dismissal based on a combination of reasons. A welcome improvement, but not a silver bullet. Judges remain cautious and won’t terminate a contract on a mere sum of half-formed grounds.

2. Building a case remains essential

Whatever the reason for dismissal, a solid case file is still essential. Whether it’s underperformance, a disrupted working relationship, or reorganization, employers must clearly explain the situation and back it with evidence. That hasn’t changed under the WWZ.

What has changed is that the importance of documentation is now more visible – especially in performance cases. To justify dismissal for poor performance, for instance, the file must show that the employee was properly warned, told what needed improvement, and given a real chance to improve. In practice, this is often hard – especially when most feedback was verbal and little was put in writing. This remains a common pitfall.

3. Statutory severance: lower, but (almost) always due

Before the WWZ, whether an employee got severance depended on the dismissal route. Under the WWZ, the transition payment became a legal right: first after two years, then from day one. That’s clearer, and fairer. Only in rare cases of serious misconduct, like major fraud or theft, is there no entitlement.

The amount is also lower now (⅓ of a monthly salary per year of service) compared to the old "cantonal court formula." Still, the statutory transition payment can be a financial strain, especially for small employers who’ve paid wages during two years of illness. The compensation scheme for such cases offers relief, but its future is uncertain.

4. Less flex work? Not really

The WWZ aimed to curb excessive flexibility in the labor market. Stricter rules on temporary contracts were supposed to nudge employers toward offering permanent jobs.

In practice, we did not see a major shift happening. Flex work remains widespread: think of payroll contracts, on-call work, agency workers, and freelancers. The WAB tightened rules again in 2020, but flex work is still going strong.

5. Litigation remains a gamble

Perhaps the biggest lesson of a decade under the WWZ: dismissal litigation is still unpredictable. Outcomes depend on the case file, the facts, the timing, and many other variables.

As a result, both employers and employees often opt for the certainty of a mutual agreement. Settlement agreements have become the norm, avoiding uncertain and time-consuming procedures at the UWV or in court. Since the WWZ, out-of-court resolution is more common than ever.

Looking ahead

Nostalgia aside, the WWZ has brought necessary reforms. But major challenges remain. For instance, there’s ongoing debate over whether the Dutch system, with its preventive dismissal checks and long sick-pay obligations, still aligns with international norms.

Will we see a new overhaul in the coming years? Time will tell. For now, we work with what we have: the WWZ and the WAB. And one truth remains – dismissals are never one-size-fits-all. Whether it’s about illness, underperformance, or restructuring, legal advice is more crucial than ever.

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