How do I substantiate the need for reorganisation?
Support measures have stopped and energy crisis and high inflation are putting many entrepreneurs in financial trouble (again). Starting to reorganise on time can then be a ‘must’. But how do you substantiate the need for reorganisation?
Do you need to reorganise due to business economic circumstances? If so, one of the options is to terminate the employment relationship with some of your employees by applying for individual dismissal permits from the UWV.
Substantiation for dismissal in the event of reorganisation
A request for dismissal for economic reasons must be substantiated with annual accounts and a profit and loss account for the past three years. You should also explain the number of jobs to be cut in relation to the minimum amount to be cut. In addition, you must provide insight into your company’s organisation and staff composition, indicating the different positions, their possible interchangeability, age and years of service.
Assessing dismissal in the event of reorganisation
Dismissal for economic reasons usually involves a poor financial situation or reorganisation. The business decision to reorganise is not always easy to assess. Therefore, there is a certain degree of policy freedom for an entrepreneur. In any case, the UWV may not sit in the employer’s chair and can therefore only marginally assess the reorganisation decision.
This policy freedom comes into play with an entrepreneur’s motive for dismissal, the size of the proposed staff reduction and the selection of the categories of jobs in which redundancies will take place. The UWV respects in principle that an entrepreneur must be able to take the appropriate decisions, which are necessary for healthy and efficient business operations, also in the longer term. Not only the corporate interest, but also the labour market interest and the employment interest may come into play here.
Which employee will be dismissed?
You cannot choose the employees for whom you apply for a dismissal permit. The UWV’s policy rules state that when determining which employees are to be nominated for dismissal, the employees must be classified by business location into so-called ‘interchangeable job categories and age groups’ based on the principle of mirroring. The age groups are classified as:
- 15-25 years;
- 26-35 years;
- 36-45 years;
- 46-55 years;
- older than 55 years.
Within each age group, the employee with the shortest tenure is put forward for dismissal first.
Reassignment in the event of reorganisation
Finally, in the UWV procedure, you as an employer must make it plausible that there are no possibilities for redeployment of the employees proposed for dismissal. This involves redeployment both within and outside the employer’s company. This assessment will also address whether other measures have been taken to maintain employment.
Notice period for dismissal due to reorganisation
The UWV dismissal procedure generally takes six to eight weeks. Does the UWV grant a dismissal permit for the employees? Then you still need to take into account the notice period of the employees concerned when terminating their employment. If a dismissal permit is granted by the UWV, the employer may reduce the notice period by one month, as long as at least one month remains.
More information or advice on reorganisations?
A letter of dismissal must be adequately substantiated and you must nominate the right employees for dismissal. The employment law specialists at LVH Advocaten can take this off your hands and, of course, advise you accordingly. Contact Lisa Kloot, employment law lawyer at LVH Advocaten in Rotterdam for more information.
