Reorganisation through dismissal (reorganisatie, ontslag) means that an employee loses their job as a direct consequence of a structural change within the company. Economic reasons, efficiency or a changing market are often the trigger. This article explains what dismissal due to reorganisation involves, which rights and obligations come with it and how outplacement can help towards a new step.
What is dismissal due to reorganisation and why does it occur?
Dismissal due to reorganisation arises when an organisation adjusts its structure, processes or workforce. The trigger can range from disappointing financial results to the merging of departments. Sometimes roles are abolished or employees are declared redundant. What matters is that the dismissal is not individual, but a direct consequence of the change in the business.
In practice, one sees, for example, a municipality that merges and thereby combines a number of similar roles. Employees whose role is abolished are faced with being declared redundant (boventallig verklaard). Employers are obliged to act carefully and to apply the reflection principle (afspiegelingsbeginsel, the proportional selection principle used to determine the order of dismissal), unless there are statutory exceptions.
The UWV (the Dutch employee insurance agency) assesses whether the dismissal is justified and whether all conditions have been met. Legally speaking, it is therefore a protected route, with regard for the social consequences for employees.
The role of the reflection principle in dismissal due to reorganisation
The reflection principle determines who is eligible for dismissal. In this process, staff are divided into age groups per category and role. Within each group, temporary contracts are considered first. The age structure then determines who becomes redundant first.
An example: in a department with five administrative employees, two must go. The employees are grouped by age and contract status. In this way it is objectively determined who may stay. This prevents arbitrariness and safeguards transparency towards employees.
Applying these rules is complex. Many organisations therefore engage an HR specialist for correct implementation. This prevents legal proceedings and uncertainty for employees.
What rights does the employee have in a reorganisation?
In the event of dismissal due to reorganisation, employees are entitled, among other things, to a transition payment (transitievergoeding), guidance towards new work and full transparency from the employer. The transition payment is intended to ease the move to other work. Its amount depends on the number of years of service and the gross monthly salary.
Moreover, the employer must check whether redeployment within the organisation is possible. Only when no suitable role is available may dismissal follow. Sometimes a settlement agreement (vaststellingsovereenkomst, VSO) is offered, in which the arrangements surrounding the dismissal are set out.
Employees are given the opportunity to be assisted by a lawyer or trade union. This provides assurance that their rights are optimally represented.
Outplacement as support after a reorganisation
Outplacement offers tailored guidance to employees who lose their job due to reorganisation. The aim is to support them in finding a new, suitable role outside the current organisation. This programme consists of career guidance, job application training and psychosocial support.
For example: an employee who has worked at a care institution for twenty years receives practical guidance through outplacement. Together with a coach, she explores which roles match her experience and talents. A job application plan is then drawn up, including improving the CV and preparing for interviews.
This guidance is not legally required, but is often included in the social plan. In this way employers demonstrate care and increase the chance of a smooth transition.
The importance of clear communication in the reorganisation process
Transparent communication is essential in a reorganisation. Employees want to know where they stand, which criteria are used and what the timeline is. Lack of clarity leads to uncertainty, reduced motivation and even long-term absence.
A good example: management organises an information session in which the process, the selection criteria and the next steps are clearly explained. Room is provided for questions, so that uncertainties can be removed straight away.
Announcing the reorganisation in good time, identifying the consequences per department and offering individual conversations all contribute to a careful process.
UWV process and dismissal application in a reorganisation
In a reorganisation, employers must apply to the UWV for a dismissal permit. In this process, the UWV assesses whether the business-economic reason is legitimate and whether the correct procedures have been followed. Employees can object, for example if they believe that the reflection principle has not been applied correctly.
The UWV process consists of several steps: submitting the application, providing supporting evidence and giving the employee the opportunity to respond. There is often consultation with the works council and trade unions about the social plan and the redeployment options.
After the UWV’s approval, the employment contract is terminated, taking into account the notice period (opzegtermijn). The page on notice period for a permanent contract explains which rules apply.
Redeployment and alternatives to dismissal
Before dismissal is actually carried out, the employer is obliged to investigate whether redeployment within the organisation is possible. This may mean that the employee is offered another suitable role, sometimes after further training or retraining.
A practical example: an employee whose role is abolished turns out, with extra training, to be suitable for a vacant role in another department. This prevents forced dismissal. Only if no realistic alternative is available may the dismissal take place.
The UWV strictly assesses whether redeployment has been seriously investigated. This obliges employers to make an active and serious effort to keep people on board wherever possible.
Financial and emotional impact of dismissal due to reorganisation
The financial consequences of dismissal due to reorganisation are far-reaching. Besides the loss of income, employees must reckon with the search for a new job and possible uncertainty about benefits. The transition payment softens this somewhat, but is not always sufficient.
Emotionally, many people experience a loss of security, status and daily structure. Outplacement can offer support here, not only practically but also in coming to terms with the dismissal. Regular conversations with coaches and peers help in finding new energy and perspective.
Information about the final settlement (eindafrekening) and the winding-up of the employment contract is therefore essential, so that employees know where they stand.
Specific points of attention
Sometimes additional factors come into play, such as long-term illness, temporary contracts or special protected positions. In these situations, different rules apply. For example, an employee who is ill during the reorganisation has extra protection against dismissal. In the area of contracts, it is important to be familiar with arrangements regarding notice periods and transition payments.
In addition, it is good to know that various forms of guidance exist, tailored to age, sector or personal wishes. The page on outplacement in the event of dismissal goes into these programmes in more detail.
For those considering becoming self-employed after a reorganisation, starting as a freelancer through outplacement offers additional information about an alternative career step.
Practical steps
The dismissal process in a reorganisation follows a number of fixed steps. First the intention to reorganise is announced, followed by consultation with the works council, the drawing up of a social plan and the selection of employees based on objective criteria. The dismissal application to the UWV and the communication to employees then follow.
After the formal termination, the guidance programme begins. Outplacement is in many cases the logical next step, as can be read in how does an outplacement programme work? This describes which steps employees and coaches go through together.
It is wise for employees to have their own situation checked legally and financially. Engaging a career adviser in good time can also contribute to a smooth transition to new work.
Summary
Dismissal due to reorganisation is a far-reaching process with major consequences for both the employee and the organisation. Clear communication, the reflection principle, careful investigation into redeployment and sound legal substantiation are essential. Outplacement offers employees perspective and support in finding new work outside the organisation. Through a people-focused approach and good guidance, room is created for a fresh start, despite the challenges of a reorganisation.
After a reorganisation dismissal in which illness plays a role, the employer is obliged to offer reintegration (re-integratie). Read more about the second track programme (spoor 2).