TRANSITIONAL ALLOWANCE

Transitional allowance in case of illness

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After 2 years of illness, the right to transitional allowance arises. You can read exactly how this works in this blog.

If an employee has been ill for 2 years then the employer may dismiss him. The employer can do this through a dismissal permit or with a settlement agreement. In both cases, the employee will be entitled to the transitional allowance when he leaves sick. Always have the settlement agreement checked by an employment law specialist from Arbeidsjurist.

Transitional allowance after 2 years of illness

After 2 years of illness, the right to transitional allowance arises. In 2019, the Supreme Court put a mandatory end to dormant employment when return to work is not possible in the short term. Thus, dormant employment is prohibited. The employer must therefore terminate the employment contract after 2 years of illness. The employer submits a dismissal request to the UWV for a dismissal permit or can offer a settlement agreement. In both cases, the employee is entitled to the statutory transitional allowance after 2 years of illness.

Level of transitional allowance after 2 years of illness

To calculate the amount of the transitional allowance, you will have to calculate the basic salary. To do this, you will take the full salary (i.e. without discount due to illness). You will also have to include the fixed and variable wage components to calculate the full monthly salary. The end date is the date the obligation to continue payment of wages ceases (104 weeks after the first day of illness) when the employee requests the termination and the actual date when the employer requests the dismissal. With our calculation tool, you can calculate your transitional allowance in case of 2 years of illness.

Settlement agreement after 2 years of illness

If the relationship between the parties is good then the choice will be made to conclude a settlement agreement after 2 years of illness. This is many times easier and financially more attractive than applying for a dismissal permit via the UWV. The settlement agreement sets out the agreements. Think about the end date of the employment contract and the amount of the transitional allowance. The alternative is for the employer to ask the UWV to grant a dismissal permit. This will be granted by the UWV after 2 years of illness if all reintegration obligations have been met.

Compensation transitional allowance sick out of service

If the employee leaves employment ill, then a (small) employer can apply through the UWV for compensation of the transition fee paid. It does not matter whether the dismissal is arranged through a permit or a settlement agreement. Under certain conditions, the employer can reclaim the paid transitional allowance from the government. The regulation 'Compensation Transitional Allowance' provides for this. The specialists at Arbeidsjurist Eindhoven will be happy to help with the application for compensation of transitional allowance.

Advice needed settlement agreement due to illness?

If you are an employee leaving sick after 2 years of illness, it is wise to get advice from a specialist. Avoid problems later and get good advice right away. As an employer, you should also pay attention when offering a settlement agreement. Are you planning to enter into a settlement agreement? Please contact an employment law specialist at Arbeidsjurist Eindhoven.

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