When you let someone go after two years of illness, it rarely feels like a legal story. It feels like cash flow, pressure from an accountant, a file that has grown thick, and a business that needs clarity. A recent ruling from the District Court of The Hague reminds us that even when the financial outcome seems predictable, the route you take still matters.
In this case, an employee who had worked for years, partly abroad, partly in the Netherlands, was dismissed after long-term illness. The employer had not asked permission from the UWV (the Dutch Employee Insurance Agency) before terminating the contract. That permission is not optional. Under Dutch law, if an employee has been sick for two years, dismissal still requires UWV approval. Skipping that step opens the door to a “billijke vergoeding”, an additional fair compensation on top of the statutory transition payment.
The court confirmed two things that matter for small employers. First, the transition payment must be calculated over the entire period of employment, including earlier service with what counts as a “successor employer” (opvolgend werkgeverschap) . If someone effectively keeps doing comparable work within the same organisational structure, earlier years may still count. For a micro-business that has restructured, merged activities, or moved contracts between entities, this is not a theoretical risk. It is a line on your balance sheet.
Second, the employer had indeed acted incorrectly by dismissing without UWV approval . That is serious. Yet the court set the additional fair compensation at zero. Why? Because even if the correct procedure had been followed, the financial outcome for the employee would not have been different. After two years of illness and the end of the wage payment obligation, there was no extra salary the employee would have received during a formal UWV process. In other words: the mistake was real, but it did not create additional financial damage.
This is not a green light to cut corners. It is a warning about proportion. As a small employer, you may think: if the end result is the same, why bother with the extra administrative step? The answer is simple. In another case, where timing, reintegration efforts, or medical assessments are different, the outcome could shift. A procedural error can suddenly translate into months of extra wage costs or a substantial additional compensation. The only reason that did not happen here is because the factual situation left little room for a different ending.
The practical lesson is modest but important. When approaching the two-year illness mark, do not treat the file as routine. Check whether reintegration obligations are fully documented. Confirm when the wage payment obligation truly ends. And before sending a termination letter, make sure the UWV route has been followed, even if you expect approval. The cost of one missed step can be far higher than the administrative burden of doing it properly.
For small business owners, employment law often feels heavy compared to the size of the team. But the system is not designed to punish careful employers; it is designed to enforce process. Calm attention to procedure is not bureaucracy for its own sake. It is risk control and in a small company, risk control is cash flow control.