Dismissal Payment upon Termination in Amsterdam: Calculation, Conditions and Rights 2025
The dismissal payment is a statutory compensation for employees in Amsterdam who are left jobless upon termination. Recorded in article 7:673 of the Dutch Civil Code, this scheme assists in the transition to a new job. At Amsterdam District Court, Parnassusweg 220 you can initiate proceedings. The Juridisch Loket Amsterdam, Vijzelstraat 77 offers free advice. This article explains your rights, how to calculate the payment and the conditions that apply in 2025.
What does the dismissal payment entail for Amsterdammers?
In Amsterdam, employers must pay this compensation upon termination on their initiative or upon mutual termination. Since the Work and Security Act (WWZ) of 1 July 2015, it financially supports employees in job searching in the city or retraining. The amount depends on years of service and salary, and can exist alongside other schemes.
Statutory basis: article 7:673 DCC
Article 7:673 DCC obliges employers in Amsterdam to pay upon:
- Termination by the employer
- Settlement agreement with employer initiative
- Calculation based on length of service and salary
- Exceptions such as probationary period or bankruptcy
For contracts up to 10 years, 1/6 monthly salary per year of service applies; thereafter 1/4.
Conditions for dismissal payment in Amsterdam
When entitled to payment?
You qualify if:
- Employment relationship ≥ 24 months
- Termination on employer's initiative
- Settlement agreement with employer as driving force
- Non-extension of fixed-term contract (under conditions)
No entitlement to dismissal payment
- Probationary dismissal
- Urgent dismissal due to employee's fault
- Employee's own initiative
- Pension age
- Death
- Employer's bankruptcy
- <24 months employment
Calculation of dismissal payment: step by step
Formula
0-10 years: 1/6 × monthly salary × service months
From year 11: 1/4 × monthly salary × extra months
Salary definition
- Gross monthly salary + holiday allowance
- Fixed allowances and bonuses
- 13th month
- Average commission
Maximum 2025
Maximum €94,000 or annual salary (if higher).
Calculation examples
Example 1: 5 years service, €3,000/month
1/6 × €3,000 × 60 = €30,000 gross
Example 2: 15 years service, €4,000/month
(1/6 × €4,000 × 120) + (1/4 × €4,000 × 60) = €80,000 + €60,000 = €140,000 (max. €94,000? No, annual salary €48,000 < max.) Wait, recalculate: actually €40,000 (10y) + €60,000 (5y) = €100,000, capped at max if applicable.
For advice: come to Juridisch Loket Amsterdam, Vijzelstraat 77 or file at Amsterdam District Court, Parnassusweg 220.