1. Legal Basis: Article 7:669 lid 3 sub d BW
The Statute
Article 7:669 lid 3 sub d of the Burgerlijk Wetboek (Dutch Civil Code) provides that an employer may terminate an employment agreement on the ground of disfunctioneren (underperformance/unsuitability) when:
- The employee is unsuitable for performing the agreed work;
- The unsuitability is not caused by illness or disability of the employee;
- The employer has informed the employee in a timely manner about the unsuitability;
- The employee has been given a sufficient opportunity to improve their performance; and
- The unsuitability is not the result of insufficient care by the employer for training or working conditions.
Additionally, the general requirement of Article 7:669 lid 1 BW applies: the employer must demonstrate that redeployment (herplaatsing) in another suitable position is not possible or not reasonable.
Key Legal Principle
The statute deliberately uses the open phrase "sufficient opportunity to improve" without specifying what this means in practice. This is where case law — particularly the Hoge Raad's 2019 Ecofys decision — fills in the gaps. The result is a flexible but demanding standard that courts apply rigorously.
The Closed System of Dismissal Grounds
Unlike US at-will employment, Dutch law operates a closed system ("gesloten ontslagstelsel") of dismissal grounds enumerated in Article 7:669 lid 3 sub a through i. An employer cannot mix and match — each ground must be independently met. The i-ground (cumulative ground, introduced in 2020) allows courts to combine nearly-met grounds, but even then the employer pays up to 1.5x the transitievergoeding as additional compensation.
2. What "Reasonable Opportunity" Means in Case Law
The Ecofys Framework (ECLI:NL:HR:2019:933)
On 14 June 2019, the Hoge Raad delivered its landmark ruling in the Ecofys case, establishing that what constitutes a "serious and real" opportunity to improve depends on the circumstances of the case. The court identified eight guiding factors (gezichtspunten):
| # | Factor | Practical Meaning |
|---|---|---|
| 1 | Nature, content, and level of the position | Senior/complex roles may warrant more time and support; simple/unskilled roles may need less |
| 2 | Employee's training and experience | A highly educated professional is expected to show more self-insight; a junior employee may need more hand-holding |
| 3 | Nature and severity of the underperformance | Persistent, fundamental failures differ from minor shortcomings |
| 4 | Duration of underperformance since notification | How long the employer tolerated the situation before acting |
| 5 | Length of the employment relationship | Long-tenured employees generally receive more time and support |
| 6 | Previous improvement attempts | What was tried before? Did earlier efforts fail? |
| 7 | Employee's openness to feedback and commitment to improvement | An employee who denies all problems may be treated differently from one who engages constructively |
| 8 | Nature and size of the employer's business | A large multinational can provide more support (coaching, training, alternative roles) than a five-person startup |
Duration: How Long Is Enough?
There is no statutory minimum duration. Courts assess reasonableness based on all circumstances. However, case law trends show:
| Duration | When Courts Have Accepted It | When Courts Have Rejected It |
|---|---|---|
| 6 weeks to 2 months | Simple, unskilled work; clear, objective performance metrics; employee demonstrably not improving despite support | Almost always rejected for skilled/professional roles; especially problematic with long-tenured employees |
| 3 months | Mid-level roles with clear metrics; short employment history; employee showing no engagement | Often insufficient for senior roles or employees with 5+ years of service |
| 4-6 months | The "sweet spot" for most professional roles; standard recommendation by Dutch employment lawyers | May be insufficient if the role is complex, the employee has very long tenure (15+ years), or the employer's own guidance was inadequate |
| 6-12 months | Senior/management roles; long-tenured employees; complex performance issues involving behavioral change | Rarely rejected as "too short" at this length, but courts may still find the quality of the trajectory insufficient |
Critical insight: Duration alone does not make a verbetertraject adequate. A six-month trajectory with vague goals, no coaching, and sparse documentation will be rejected just as readily as a two-month trajectory.
Case Law on Duration
- Gerechtshof Arnhem-Leeuwarden (3 February 2016): A 6-month trajectory (3 months + 3-month extension based on partial improvement) was accepted as adequate for an employee with 23 years of service.
- Rechtbank Rotterdam (ECLI:NL:RBROT:2025:5440): A 4.5-month trajectory (July to November 2024) was accepted for a Manager Operations with approximately 1 year of service, where the employee was given regular evaluations and clear improvement areas.
- Rechtbank Midden-Nederland (ECLI:NL:RBMNE:2024:1282): A relatively brief improvement plan, largely scheduled during summer months, was rejected for a 58-year-old employee with long tenure — the court found the employee received "no serious opportunity" to improve behavioral functioning.
3. Required Elements of a Legally Valid Verbetertraject
Based on the Ecofys framework and subsequent case law (particularly Gerechtshof Arnhem-Leeuwarden, ECLI:NL:GHARL:2022:9956), a legally defensible verbetertraject must include:
3.1 Clear Description of Shortcomings
- Specific, documented performance deficiencies — not vague statements like "needs to be more proactive" or "attitude needs improvement"
- Concrete examples with dates, contexts, and impacts
- Reference to the job description and expected performance standards
- The employee must understand exactly what is wrong
3.2 Measurable Improvement Goals (SMART Criteria)
Goals must be:
- Specific: "Reduce error rate in financial reports from 12% to under 3%" — not "improve accuracy"
- Measurable: Quantifiable where possible; for behavioral issues, observable behaviors must be defined
- Achievable: Goals must be realistic given the employee's role, experience, and the support provided
- Relevant: Connected to actual job requirements, not fabricated metrics
- Time-bound: Clear milestones and deadlines within the trajectory
Court warning: In ECLI:NL:RBMNE:2024:1282, the court rejected an improvement plan that contained "no concrete objective, deadline, or conditions." Vague coaching proposals without structured targets are insufficient.
3.3 Regular Evaluation Moments
- Frequency: Bi-weekly progress meetings are the standard recommendation; weekly for critical situations; monthly at minimum
- Documentation: Every evaluation meeting must be documented in writing, ideally signed by both parties
- Interim assessments: At least one formal mid-point evaluation, not just a final assessment
- Employee input: The employee must have opportunity to respond and provide their perspective at each evaluation
3.4 Coaching, Support, and Guidance
This is where most American employers fail. The employer must actively support the employee, not merely "observe and record failure." Required support may include:
- Internal coaching from a direct manager or senior colleague (regular, structured sessions)
- External coaching by a professional coach (courts increasingly expect this for behavioral or soft-skill issues)
- Training and education relevant to identified skill gaps
- Adjusted workload or temporary reduction in responsibilities to allow focus on improvement
- Mentoring or buddy systems
Critical: The employer must take the lead. In Rechtbank Noord-Nederland (Groningen, 2 December 2015), the court found it was "poor practice" to require the employee to create their own improvement proposals. The employer drives the trajectory.
Level of support varies by context:
- Large employers are expected to provide more resources (external coaches, formal training programs)
- Small employers get somewhat more latitude, but must still demonstrate genuine effort
- The more senior/experienced the employee, the more the employee is expected to show self-insight and initiative — but the employer must still provide the framework
3.5 Warning About Consequences
- The employee must be explicitly told (in writing) that failure to improve to the required level may result in termination
- This warning should be part of the improvement plan document, not a separate afterthought
- The consequence must be credible and clearly linked to the improvement goals
3.6 Consideration of Alternative Positions
- Before concluding the trajectory has failed, the employer must investigate whether the employee can be placed in a different, suitable position (see Section 5 on herplaatsing)
- This must be documented — "we considered alternative roles and found none" is insufficient without evidence of actual investigation
3.7 No Conflicting Signals
Courts scrutinize whether the employer sent mixed messages:
- Giving a salary increase while simultaneously claiming underperformance undermines the case
- Positive performance reviews in the file that contradict the claimed underperformance are fatal
- Assigning new responsibilities or promotions during the period of alleged underperformance
4. Common Employer Mistakes That Cause Courts to Reject Termination
Based on analysis of published case law, these are the most frequent reasons courts reject termination requests on the d-ground:
Mistake #1: No Formal Verbetertraject at All
Many employers believe that "we had conversations about the problems" is sufficient. It is not. Courts distinguish between informal feedback and a structured improvement trajectory. Without a formal plan with documented goals, timelines, and evaluations, termination will almost certainly be rejected.
Exception: In ECLI:NL:GHSHE:2017:5861 (Gerechtshof 's-Hertogenbosch), the court approved termination despite the absence of a formal improvement plan — but only because the employee "repeatedly and unequivocally denied dysfunction" and refused to engage with any feedback whatsoever. This is a narrow exception, not a loophole.
Mistake #2: Goals Too Vague
"Improve communication skills" or "be more proactive" are not legally sufficient improvement goals. Courts require specific, measurable targets. The more subjective the performance issue (attitude, teamwork, leadership), the more effort the employer must invest in defining observable, measurable behaviors.
Mistake #3: Insufficient Duration
American managers instinctively reach for a 30-60-90 day framework. In the Netherlands, anything under 3 months for a professional role is almost certainly insufficient, and 6 months is the safer minimum for employees with significant tenure.
Mistake #4: No Real Coaching or Support
Simply "monitoring" an employee's performance is not a verbetertraject — it is surveillance. The employer must actively invest in the employee's improvement through coaching, training, mentoring, or other concrete support measures. In Rechtbank Overijssel (Enschede, 16 October 2015), termination was rejected because no coaching trajectory was provided.
Mistake #5: Documentation Gaps
Every conversation, every evaluation, every piece of feedback must be documented in writing. Courts look for a complete paper trail showing the full arc of the trajectory. Gaps in documentation create the presumption that the employer was not actually engaged in the process.
Mistake #6: Not Investigating Alternative Positions
Even after a failed verbetertraject, the employer must demonstrate that they searched for suitable alternative positions. Failure to investigate herplaatsing is an independent ground for rejection, even if the verbetertraject itself was flawless.
Mistake #7: Demotion or Task Removal During the Trajectory
In several cases, courts found that employers undermined the trajectory by removing responsibilities from the employee or effectively demoting them during the improvement period. This contradicts the requirement that the employee be given a genuine opportunity to improve in their actual role. (Cf. Rechtbank Amsterdam, 7 December 2015, which awarded EUR 40,000 in additional compensation for a "sham trajectory.")
Mistake #8: Presenting an Ultimatum
In case law from Rechtbank Rotterdam (May 2021), the court held that presenting the employee with a choice — "either you follow an improvement plan or you leave via settlement" — signals that the employer has already decided the employee must go, undermining the genuineness of the trajectory.
5. The Herplaatsing (Redeployment) Obligation
Legal Basis
Article 7:669 lid 1 BW requires that, for any termination ground (including disfunctioneren), the employer must demonstrate that redeployment in another suitable position is not possible or not reasonable within a reasonable timeframe, with or without additional training.
Scope: How Broadly Must the Employer Search?
Under Article 9 of the Ontslagregeling (Dismissal Regulation), the redeployment obligation extends to:
- The employer's own organization — all departments, locations, branches
- All domestic and foreign entities within the corporate group ("concern")
- This includes parent companies, sister companies, and subsidiaries
Critical for US multinationals: If an American parent company sets up a Dutch subsidiary (BV), and the BV seeks to terminate an employee for underperformance, the redeployment obligation extends to all entities within the global group — including positions in the US, other European entities, and elsewhere.
In Obvion N.V. / Rabobank (Rechtbank Utrecht, 2016), the court rejected the employer's claim that it could not facilitate redeployment across Rabobank group companies. The employer must include positions in other group companies when assessing available suitable roles.
What "Suitable" Means
A suitable position:
- Matches the employee's education, experience, and abilities
- May include positions below the original role level
- May require reasonable retraining (if the training can be completed within the redeployment timeframe)
- Does not include positions requiring fundamental requalification (e.g., a six-month software development course for a non-technical employee with a one-month notice period)
Reasonable Timeframe
The redeployment timeframe equals the employer's statutory notice period:
| Years of Service | Notice Period / Redeployment Window |
|---|---|
| 0-5 years | 1 month |
| 5-10 years | 2 months |
| 10-15 years | 3 months |
| 15+ years | 4 months |
| Disabled workers | 26 weeks |
Practical Obligations
The employer must:
- Actively investigate available positions (not wait for the employee to find them)
- Give the at-risk employee priority over external candidates for suitable vacancies
- Document the search and its results
- Consider whether retraining within the timeframe could enable redeployment
- Demonstrate all of this to the court at the time of the termination request
6. Comparison: American PIP vs. Dutch Verbetertraject
| Dimension | American PIP | Dutch Verbetertraject |
|---|---|---|
| Legal status | No legal requirement in at-will states; a management tool, not a legal obligation | Legally mandated by statute (Art. 7:669 lid 3 sub d BW) and scrutinized by courts |
| Typical duration | 30-60-90 days | 3-6 months minimum; 6-12 months for senior/long-tenured employees |
| True purpose (in practice) | Frequently a "managed exit" -- widely perceived by HR professionals, managers, and employees alike as a precursor to termination rather than a genuine improvement opportunity | Must be a genuine opportunity to improve; courts will reject termination if the trajectory was a sham |
| Employer's role | Sets goals, monitors, documents | Must actively coach, support, train, and guide the employee toward improvement |
| Goal specificity | Often specific, but employer has wide discretion | Must be SMART; courts reject vague or unrealistic goals |
| Evaluation frequency | Varies; often just an end-of-period review | Regular (bi-weekly recommended); each session documented |
| Coaching requirement | Optional; often none provided | Effectively mandatory; courts expect internal or external coaching |
| Consequence of inadequate PIP | None in at-will states — employer can terminate regardless | Court rejects the termination request; employer may owe billijke vergoeding (fair compensation) on top of transitievergoeding |
| Redeployment obligation | None | Mandatory search across entire corporate group |
| If employee gets sick during PIP | PIP typically continues or employee is terminated | Trajectory must be paused; opzegverbod (dismissal prohibition) during illness applies |
| Settlement alternative | Severance package offered; employee has little leverage | Employee has significant leverage; settlement typically 1-2x transitievergoeding |
| Court involvement | None (at-will termination) | Kantonrechter must approve termination; applies Ecofys factors |
Where They Diverge Catastrophically
The fundamental disconnect is intent. In US practice, a PIP is widely understood — by HR professionals, managers, and employees alike — as the final step before termination. The Harvard Business Review, SHRM, and employment attorneys routinely advise employees that "being placed on a PIP means you should start looking for a new job."
In the Netherlands, this mindset will destroy your case. If a Dutch court concludes that the verbetertraject was not a genuine attempt to help the employee improve — but rather a predetermined path to termination — the court will:
- Reject the termination request (the majority of d-ground requests are rejected)
- Potentially award billijke vergoeding (fair compensation) on top of the transitievergoeding for the employer's blameworthy conduct
- Leave the employer stuck with an employee they can no longer work with, often leading to a much more expensive settlement
The American PIP is a funeral procession. The Dutch verbetertraject must be a genuine rehabilitation program.
7. The Role of the Bedrijfsarts (Occupational Health Physician)
When Underperformance May Be Health-Related
A fundamental principle of Dutch employment law: you cannot terminate an employee for underperformance if the underperformance is caused by illness or disability. Article 7:669 lid 3 sub d BW explicitly excludes unsuitability caused by "ziekte of gebreken" (illness or defects).
The Opzegverbod (Dismissal Prohibition) During Illness
Under Article 7:670 lid 1 BW, an employer cannot terminate an employee who is sick. This creates a critical interaction with the verbetertraject:
- If an employee becomes sick during a verbetertraject, the trajectory must be paused
- The employer cannot proceed with a termination request while the employee is on sick leave
- The verbetertraject can only resume once the bedrijfsarts declares the employee fit to work
The "Flight into Illness" Problem
A common pattern: the employer initiates a verbetertraject → the employee reports sick → the trajectory stalls → months pass → the employer is stuck.
Dutch practice addresses this through:
- Bedrijfsarts assessment: Only the bedrijfsarts (occupational physician) is legally authorized to determine whether the employee is genuinely ill. The employee's own GP (huisarts) opinion is not decisive.
- Situatieve arbeidsongeschiktheid: When the employee is not medically ill but experiences psychological distress due to the workplace situation, the bedrijfsarts may classify this as "situational incapacity" rather than medical illness.
- Deskundigenoordeel (expert opinion): Either party can request the UWV to provide an independent assessment of whether the employee is genuinely unable to work.
- Demedicalization trend: Modern bedrijfsartsen increasingly distinguish between genuine illness and workplace conflict. When pure conflict exists, the physician may grant a brief "time out" (typically 1-2 weeks) rather than ongoing sick leave, and require the employer to initiate conflict resolution (often through mediation).
Practical Guidance
- Before starting a verbetertraject: Consider whether health issues may be contributing to underperformance. If there is any doubt, involve the bedrijfsarts first.
- During a verbetertraject: If the employee reports sick, immediately refer them to the bedrijfsarts. Do not attempt to continue the trajectory during illness.
- If the bedrijfsarts finds no illness: The trajectory can continue. Document the bedrijfsarts's finding.
- If the bedrijfsarts finds partial illness: Discuss with the bedrijfsarts what the employee can and cannot do. The trajectory may need to be adjusted.
8. Settlement Alternative: Vaststellingsovereenkomst vs. Verbetertraject
When to Consider a Settlement
In many underperformance situations, the pragmatic path is to negotiate a vaststellingsovereenkomst (VSO, settlement agreement) rather than run a full verbetertraject. This is particularly true when:
- The employment relationship is already severely damaged
- The employee acknowledges the problems are likely irreconcilable
- The cost and management time of a 3-6 month trajectory exceed the settlement cost
- There is a risk the verbetertraject will fail legally (insufficient documentation, mixed signals in the file)
- Mediation has been attempted and failed
Cost Comparison
| Cost Element | Verbetertraject | Settlement (VSO) |
|---|---|---|
| Duration of continued employment | 3-6 months minimum (salary continues) | Negotiated end date (typically within notice period) |
| Management time | Significant: bi-weekly meetings, documentation, coaching coordination | Moderate: negotiation period, typically weeks |
| External costs | Coaching (EUR 5,000-15,000), legal advice on trajectory design, potential training | Legal advice for both parties (employer typically pays EUR 750-2,500 for employee's legal review) |
| Transitievergoeding | Owed upon termination regardless | Included in settlement (often as minimum) |
| Additional compensation | Risk of billijke vergoeding if trajectory is found inadequate | Typically 1-2x transitievergoeding total package; may be higher if employer's file is weak |
| Risk of failure | HIGH -- the majority of d-ground court requests are rejected, meaning you may run a 6-month trajectory and still fail to get termination approved | LOW -- once signed, the VSO is binding (employee has 14-day cooling-off period) |
| Total estimated cost | 3-6 months salary + management time + external costs + risk premium | Typically equivalent of 3-6 months salary as lump sum, but with certainty |
The Paradox
The employer's negotiating leverage in a settlement depends on having a credible dismissal file. If the employer has no documentation of underperformance, no prior feedback, and no attempt at improvement, the employee (and their lawyer) know that the employer cannot obtain a court termination. This drives settlement amounts upward.
Conversely, an employer who has documented underperformance, provided feedback, and offered some improvement support — even if not a complete verbetertraject — has stronger leverage to negotiate a reasonable settlement.
Best practice for US managers: Start documenting performance issues and providing written feedback immediately, even if you intend to pursue a settlement rather than a verbetertraject. The documentation serves double duty.
The 14-Day Cooling-Off Period
Under Article 7:670b lid 2 BW, an employee who signs a vaststellingsovereenkomst has 14 calendar days to revoke it without stating a reason. If the employer fails to mention this right in the agreement, the period extends to 21 days. This is non-negotiable.
9. Five Case Studies from Published Case Law
Case 1: Termination APPROVED — The Uncooperative Senior Project Manager
Citation: ECLI:NL:GHSHE:2017:5861 Court: Gerechtshof 's-Hertogenbosch (Court of Appeal) Date: 21 December 2017
Facts: An ICT service provider employed a senior project manager whose contract converted from fixed-term to indefinite in August 2015. Performance issues emerged quickly: removed from a client project due to trust deficit (September 2015), written warning citing inadequate planning, progress reporting, and stakeholder management (October 2015), failed required PMI certification exam (March 2016), and multiple documented performance meetings April-September 2016.
No formal improvement plan was created. However, the employer provided:
- Detailed written warnings with specific deficiencies
- Multiple performance discussions with concrete feedback
- Offered support and guidance
- Clear documentation of each conversation
Ruling: Termination approved despite no formal verbeterplan. Key factor: the employee "repeatedly and unequivocally denied dysfunction" despite all feedback. The court held that when an employee persistently refuses to acknowledge performance deficiencies, the employer's obligation to provide a formal improvement plan is effectively negated. The employee's belated, reluctant acknowledgment of problems "in this procedure" came "so late and reluctantly that it cannot be considered."
Lesson: Employee non-cooperation and denial can override the formal improvement plan requirement — but this is a narrow exception, not a strategy.
Case 2: Termination REJECTED — The Long-Tenured Employee Without Concrete Goals
Citation: ECLI:NL:RBOVE:2016:4980 Court: Kantonrechter Overijssel Date: 2016
Facts: An employee with 24+ years of service faced dismissal after organizational changes increased job demands. An external assessment concluded the employee was "developable with proper coaching." The employer held performance discussions, issued warnings, and provided on-site coaching.
Ruling: Termination rejected. The court found that the employer:
- Failed to set concrete, measurable improvement targets
- Provided no structured improvement plan with clear milestones
- Offered insufficient meaningful support beyond general evaluations
- Did not define timelines or evaluation points
Key quote from the court: A long-tenured employee deserves "heavier effort" from the employer seeking termination on performance grounds.
Lesson: Conversations and warnings are not a verbetertraject. For long-tenured employees, the bar is significantly higher.
Case 3: Termination APPROVED — The Operations Manager Who Didn't Act
Citation: ECLI:NL:RBROT:2025:5440 Court: Rechtbank Rotterdam Date: 30 April 2025
Facts: An employer hired a Manager Operations in January 2024 to restructure a department. A verbetertraject was initiated on 9 July 2024, running until 27 November 2024 (~4.5 months). The improvement plan addressed specific areas: accuracy, time management, safety compliance, independent work performance, following agreements, and not involving colleagues unnecessarily. Regular evaluation meetings with documented progress reports were held. The employee participated (though initially refusing to sign the plan).
Ruling: Termination approved. The court found the employer had provided "a serious and genuine opportunity for improvement." Key factors in the employer's favor:
- Specific, measurable improvement areas
- Regular, documented evaluations
- Adequate duration (4.5 months)
- The employee "did not convert words into actions" — verbally accepted changes but behavior did not improve
- Safety issues (leaving open containers of flammable thinner unattended) were particularly serious
Lesson: A well-structured, well-documented trajectory of adequate length will be upheld, especially when the employee had a clear opportunity and failed to take it.
Case 4: Termination on d-ground REJECTED, i-ground APPROVED — The Behavioral Issue Without Support
Citation: ECLI:NL:RBMNE:2024:1282 Court: Rechtbank Midden-Nederland Date: 23 February 2024
Facts: A 58-year-old employee with long tenure faced performance issues centered on attitude, behavior, and teamwork (not technical competence) following team restructuring. The employer attempted two improvement efforts.
What went wrong with the verbetertraject:
- The coaching proposal included "no concrete objective, deadline, or conditions"
- After December 2022, the employer abandoned coaching discussions despite being the "leading party"
- When the employee requested external coaching (his preferred approach), the employer declined
- The second improvement plan was "relatively brief" and largely scheduled during summer months
- Conversations primarily involved "repeatedly confronting the worker with criticism" without tailored support
Ruling: Termination on the d-ground (underperformance) was rejected — the employee received "no serious opportunity" to improve. However, the court approved termination on the i-ground (cumulative grounds) because the combined circumstances — prolonged friction, failed mediation, and the employee's freedom from work since October 2023 — justified it.
Compensation: Transitievergoeding of EUR 79,889.95 plus an additional 50% (maximum allowed under the i-ground) as cumulative compensation.
Lesson: Failing the verbetertraject doesn't always mean the employer loses entirely — but the i-ground comes with a significant price premium. The employer paid roughly EUR 120,000 instead of what might have been EUR 80,000 with a proper d-ground termination.
Case 5: Termination REJECTED — The Ultimatum That Backfired
Citation: Rechtbank Rotterdam, May 2021 (discussed in Salaris Vanmorgen) Court: Kantonrechter Rotterdam Date: May 2021
Facts: An employer presented an employee with a choice: participate in a verbetertraject or leave via a vaststellingsovereenkomst. The court examined the employer's conduct and found:
- The employer had given the employee "almost obsessive attention" through constant monitoring
- The framing of the choice — "either you follow an improvement plan or you depart" — signaled the employer had already decided the employee must go
- The constant surveillance meant "someone always does something wrong"
- The employer should have intervened in the underlying conflict earlier
Ruling: The court terminated the employment relationship but awarded:
- Transitievergoeding: EUR 2,269 gross
- Billijke vergoeding (fair compensation): EUR 5,000 gross — a penalty for the employer's blameworthy conduct
Lesson: Never present the verbetertraject as an ultimatum or pair it with a settlement offer. Courts read this as evidence that the trajectory is not genuine. Also: micromanaging an employee during a verbetertraject can backfire catastrophically.
10. Practical Guidance for US Managers
Step-by-Step: Addressing Underperformance in a Dutch Team Member
Phase 0: Before You Start (Weeks 1-4)
- Check the employment contract and any applicable CAO (collective labor agreement). Some CAOs have specific provisions about performance management.
- Review the employee's performance file. Are there prior positive evaluations that contradict the current concerns? If so, you need to build a bridge between those and the current issues.
- Consult a Dutch employment lawyer. Do this BEFORE taking any action. Not after. Not during. Before. Dutch employment law is procedural, and missteps early in the process are often fatal.
- Rule out health issues. If there is any possibility that the underperformance is health-related (stress, burnout, depression, physical issues), involve the bedrijfsarts first.
- Document everything from this point forward. Every conversation, every piece of feedback, every email — in writing.
Phase 1: Informal Feedback (Weeks 1-8)
- Have a frank conversation with the employee about the performance concerns. Be specific. Give concrete examples.
- Confirm the conversation in writing (email or letter), summarizing what was discussed and what improvement is expected.
- Provide initial support — ask what the employee needs to improve. Offer resources.
- Follow up regularly (at least monthly) and document progress or lack thereof.
Phase 2: Formal Verbetertraject (Months 3-9)
- Create a formal written improvement plan containing:
- Specific shortcomings with concrete examples
- SMART improvement goals
- Timeline (minimum 3 months; 6 months recommended for tenured employees)
- Evaluation schedule (bi-weekly meetings)
- Support measures (coaching, training, mentoring)
- Explicit warning that failure to improve may result in termination
- Discuss the plan with the employee. Give them opportunity to provide input. They should sign it (or at minimum receive it and acknowledge receipt).
- Conduct regular evaluations and document each one in writing. Include both the employer's assessment and the employee's response.
- Provide the promised support. If you committed to coaching, deliver the coaching. If you promised training, enroll them.
- Conduct a formal mid-point review. Assess progress, adjust goals if needed, and document.
- Conduct a final evaluation. Determine whether improvement has been sufficient.
Phase 3: After the Verbetertraject
- If the employee has improved: Document this, end the trajectory, and monitor for sustained improvement.
- If the employee has not improved sufficiently:
- Investigate herplaatsing across your entire corporate group (including the US parent and any other entities)
- Document the herplaatsing investigation and its results
- Consider a settlement (vaststellingsovereenkomst) before going to court — it is often faster, cheaper, and more certain
- If no settlement is possible, file for ontbinding (termination) with the kantonrechter through your Dutch employment lawyer
What NOT to Do
| Do NOT... | Because... |
|---|---|
| Use a 30-60-90 day American-style PIP | Courts will find the duration insufficient for most professional roles |
| Treat the verbetertraject as a managed exit | Courts will detect this and reject the termination |
| Set vague goals ("improve communication") | Courts require specific, measurable targets |
| Skip the coaching | Courts expect active employer support, not passive monitoring |
| Ignore the herplaatsing obligation | This is an independent ground for rejection |
| Continue the trajectory if the employee gets sick | The opzegverbod prohibits this; pause and wait |
| Present it as an ultimatum ("improve or leave") | Courts read this as evidence the trajectory is not genuine |
| Give positive performance reviews while running a verbetertraject | Contradictory signals destroy your case |
| Assume your US HR processes will work in the Netherlands | They will not. Dutch employment law is fundamentally different. |
When to Involve Dutch Employment Counsel
- Before starting any formal performance management process — not after
- When the employee reports sick during the verbetertraject
- When considering whether to pursue a verbetertraject vs. a settlement
- Before filing any termination request with the kantonrechter
- When the employee is a member of the works council (ondernemingsraad) or is pregnant (additional protections apply)
- When there is any doubt about the adequacy of your file
Sources
Primary Legal Sources
- Article 7:669 lid 3 sub d BW (Dutch Civil Code)
- Article 7:670 lid 1 BW (dismissal prohibition during illness)
- Article 7:670b lid 2 BW (cooling-off period for settlement agreements)
- Ontslagregeling, Article 9 (redeployment obligation scope)
Landmark Case Law
- Hoge Raad 14 June 2019, ECLI:NL:HR:2019:933 (Ecofys) — Seven guiding factors for evaluating verbetertraject adequacy
- Hoge Raad 2018, ECLI:NL:HR:2018:182 (Decor) -- Evidentiary standards for assessing disfunctioneren (companion case to Ecofys)
Case Studies Cited
- ECLI:NL:GHSHE:2017:5861 — Gerechtshof 's-Hertogenbosch, termination approved despite no formal plan
- ECLI:NL:RBOVE:2016:4980 — Kantonrechter Overijssel, termination rejected for long-tenured employee
- ECLI:NL:RBROT:2025:5440 — Rechtbank Rotterdam, termination approved after proper trajectory
- ECLI:NL:RBMNE:2024:1282 — Rechtbank Midden-Nederland, d-ground rejected but i-ground approved
- ECLI:NL:GHARL:2022:9956 — Gerechtshof Arnhem-Leeuwarden, improvement plan requirements
Secondary Sources (Law Firm Analysis and Practitioner Guidance)
- WS Advocaten — Wat is een goed verbetertraject bij disfunctioneren?
- LXA Advocaten — De ins en outs van het verbetertraject
- Ovidius Law — Non-performance and the PIP under Dutch law
- Osborne Clarke — Poor performance of an employee: what to do?
- Loyens & Loeff — Hoge Raad gezichtspunten verbetertraject
- JENS Advocaten — Het verbetertraject bij disfunctioneren
- Russell Advocaten — PIP for an underperforming employee
- AMS Advocaten — Herplaatsing binnen een concern
- Van Gelderen — Disfunctioneren en herplaatsing
- Vijverberg Advocaten — Ziekte, arbeidsconflict of disfunctioneren
- Heron Advies — Vragen en antwoorden verbetertraject
- Salaris Vanmorgen — Kiezen tussen verbetertraject of vaststellingsovereenkomst
- De Koning Advocaten — Eisen verbetertraject
- DVDW — Hoge Raad gezichtspunten disfunctioneren
- I amsterdam — Dismissal for poor performance
- Legal Expat Desk — Performance Improvement Plan guide
Research compiled 2026-03-16. Case law and statutory references verified against available sources. Specific settlement amounts and cost estimates should be verified with Dutch employment counsel for current market conditions.