End employment of an employee
Go to the profile of the employee you want to end the employment of. Click the ⋮ icon next to Employment, click 'Create termination'.
Enter the termination details:
End date
The end date is the last date of the contract of the employee. It's not the day after the last date of the contract. So if their contract runs until March 31, you put the end date on March 31, not on April 1st.
When you agree with an employee to terminate their contract before the end date of their contract, enter the agreed end date. This could be the last day they work, but it doesn't have to be. Maybe you agreed that you will pay them until a certain date, and that they take up remaining holiday hours.
Be aware that if you terminate someone on the 1st of the month, you still pay them for that 1 day in that month. If someone is terminated at the end of a month, it's best to put the end date on the last day of that month instead of the first day of the next month.
Initiator
Who requested the termination? The employee or you as the employer?
Termination reason & termination pay
The reason for termination. This will be send to the tax office and UWV, which will be done automatically when the last payslip of this employee is paid. Depending on the termination reason you are obliged to pay transition pay.
You have to pay transition pay when you terminate an employee with one of the following reasons:
Probation period not completed successfully - code 1 of Belastingdienst
Dismissed through court order (in case the reason isn't because of extreme negligence of the employee) - code 3 of Belastingdienst
Long-term work disability - code 5 of Belastingdienst
Business economic reasons - code 6 of Belastingdienst
Temporary contract not renewed - code 30 of Belastingdienst
Regrettable exit
Would you hire this person again? This is used to keep track of how many exits could have been prevented in the future, which is a KPI to steer your restaurant group on.
Severance pay
You can use severance pay in case you agreed with the employee to pay them a certain amount when they leave. Often agreed on through a settlement agreement (vaststellingsovereenkomst, or VSO, in Dutch).
Send and finalise the draft termination
After you've added the termination details, you can finalise the termination by informing the employee of the termination.
The employee is still employed until you officially finalise the termination. You are legally obliged to inform the employee about it.
The termination code and end date are added by default to the termination email. This is also information you are legally obliged to communicate.
Finalise termination payout
After you've finalised the termination, you will need to finalise the termination payout.
The termination payout consists of:
Any holiday pay that is saved for the employee.
The outstanding overtime balance. If the employee has made overtime, you have to pay them for that overtime. If the employee worked too little, you can deduct hours that they should've worked from their final payslip. See the image above on how to decide how many hours to pay out, withhold, or do nothing with the hours.
The outstanding leave entitlement balance. If the employee hasn't taken enough holiday, and still has some leave entitlement hours left, you have to pay them those hours. If they took too much holiday, and have a negative leave entitlement balance, they have to pay you back and you can deduct those hours from their final payslip.
Transition pay, decided in the draft termination based on the termination reason.
Severance pay, decided on in a settlement agreement, if applicable.
Save the final compensation details & how it's paid out
Once you've updated and saved the final termination payout, the payslip of the last month the employee is employed will be updated (when they haven't got their last salary yet) or corrected (when they already have gotten their last salary).
The correction will consist of the overtime and the leave entitlement that are paid out or withheld. So when someone is terminated on June 30, their payslip of June will include holiday pay, remaining overtime and remaining leave entitlement.
The outstanding holiday pay will already be present on the last payslip, so if you want to compensate hours that they have to pay back with holiday pay, it's best to wait with paying their last salary until after their last work day. So you are 100% sure how many hours of overtime or leave entitlement you want to withhold from their last payslip.
Transition pay and severance
Transition pay and severance legally have to be paid out on a separate payslip since it's taxed against the green tax table from the Belastingdienst. This payslip with any transition pay or severance will be marked as 'Exit' in Pay.