Why is it actually so important to know whether there is an employment contract? To begin with, it is good to know that the vast majority of the working population in the Netherlands works on the basis of an employment contract.
The employment contract is also known as the “ticket of entry” to labor law and social security law. This is obviously not without reason. When there is an employment contract, the employee is protected by a variety of rules. These include, among other things, the right to payment of wages during illness, dismissal protection, severance pay and vacation days. Employees who work on the basis of an employment contract also enjoy protection from other laws, such as the Work and Care Act, the Minimum Wage and Minimum Holiday Allowance Act and the Working Hours Act.
Furthermore, the employment contract gives the employee access to the employee insurance, such as the Sickness Act, Unemployment Act and the WIA. In short, it is of great importance for the employee to know whether he or she is working on the basis of an employment contract.
On November 6, 2020, the Supreme Court provided more clarity on this qualification question. In fact, according to some, the Supreme Court has thereby implemented a new change of course. After all, the standard that the Supreme Court formulated in its well-known Groen/Schoevers judgment in 1997 has applied to this assessment for more than twenty years. The interpretation of this standard meant that the intention of the parties was also relevant in assessing whether there was an employment contract.
On November 6, 2020, the Supreme Court ruled that the only thing that matters in assessing whether there is an employment contract is whether the content of the agreement meets the statutory definition of the employment contract from Article 610 of Book 7 of the Dutch Civil Code. The text of this statutory article reads as follows:
“The employment contract is the agreement whereby one party, the employee, undertakes to perform work for the other party, the employer, against remuneration for a certain period of time.”
According to the Supreme Court, it is therefore not relevant whether the parties actually intended to conclude an employment contract.
So does the intention of the parties no longer play any role at all? No, according to the Supreme Court. Before the qualification question can be answered, it must be assessed what rights and obligations (content) the parties actually agreed to in the agreement. The intention of the parties still plays a role here, according to the Supreme Court. However, the content must then be interpreted and the intention of the parties therefore plays a role in this interpretation. Only after this has been established can one proceed to the qualification question: whether the agreement has the characteristics of an employment contract.
All in all, enough reason to always take a critical look at the content of the employment contract.
If you have any questions or are presented with an employment contract, you can contact Elfi Labor Law Lawyer for a free consultation.