Facts
Employee has been employed by CJ Wildlife, an English company, since 20 August 2018 under an employment contract for an indefinite period. At a certain point, the employer wished to transfer the employee to its Dutch entity, trading under the name Vivara. An ICT permit (Intra-Corporate Transferee permit) was applied for. The permit was granted for a period of three years, being the maximum duration, and took effect on 1 August 2022.
On 30 August 2022, Vivara and the employee entered into an employment contract for an indefinite period. On 18 November 2024, the employee reported sick.
On 27 February 2025, the employee informed Vivara, among other things, of the upcoming expiry of his residence permit. On 18 March 2025, Vivara informed the employee that his position would be terminated as of 1 May 2025. On 27 March 2025, Vivara notified the IND accordingly.
Vivara filed a request for dissolution of the employment contract and argued that it could not reasonably be expected to continue the employment relationship with the employee on the basis of the h-ground, as employers are not allowed to employ non-EU or non-EEA nationals in the Netherlands without a valid work permit. The employee’s permit was due to expire, as a result of which “legalisation of the employment relationship is not possible.”
Judgment
The Subdistrict Court rejected the request for dissolution of the employment contract.
The court considers it highly unlikely that the employee will obtain a new permit following the expiry of his current permit. Vivara does not intend to apply for a different type of permit, and the employee’s long-term incapacity for work makes it unlikely that another employer would employ him. As a result, the employment contract could in principle be considered devoid of substance. However, this circumstance does not lead the court to follow Vivara’s position.
The court follows the employee in his argument that he did not come to the Netherlands on a purely temporary basis, but that the parties intended for him to work for Vivara in the Netherlands for an indefinite period. Relevant circumstances include the separately concluded Dutch employment contract for an indefinite period and the arrangements in that contract for the period after the expiry of the ICT permit.
Based on this, the court concludes that the employee was in fact “a regular employee” and should be treated as such. Vivara should have offered the employee a termination proposal, as it did for other employees whose positions were made redundant. If the employee had rejected that proposal, Vivara should have applied for a dismissal permit from the UWV. That application would have been rejected due to the prohibition on termination during illness.
In short, Vivara could only have terminated the employment relationship after the end of the statutory continued payment of wages during illness, being 104 weeks after the start of the illness, unless this period was extended.
Analysis
This judgment is noteworthy for several reasons. When an employer intends to employ a worker from outside the EU or EEA, it is important to carefully assess the situation. As this case shows, migration law and labour law do not always align.
First, it is notable that the employer and the employee chose to also enter into an employment contract with the Dutch entity. One of the requirements for obtaining an ICT permit is that the employment contract with the foreign entity remains in place. In other words, an employment contract with the Dutch entity is not required. This raises questions such as how the two employment contracts relate to each other. In addition, the Dutch employment contract was concluded for an indefinite period rather than, for example, for the duration of the assignment, which would have been possible under Dutch labour law. If the employer had chosen that option, the employment contract would have ended by operation of law.
Second, the rationale of the ICT permit, which is also reflected in one of its conditions, is difficult to reconcile with the apparent intention of the employer and the employee regarding the transfer. According to the employee, and not disputed by the employer, the parties intended to continue their relationship after the expiry of the permit, for example on the basis of a highly skilled migrant permit. The employment contract with the foreign employer or the assignment letter should show that the employee can return to the foreign entity at the end of the assignment. This does not appear to have been the intention of the parties.
Third, it is advisable to include a resolutive condition in employment contracts with foreign nationals. Such a clause provides that the employment contract will end immediately when the employee loses the right to work in the Netherlands for that employer. There are, of course, requirements for agreeing on a legally valid resolutive condition. For example, the occurrence of the condition may not depend on the employer’s assessment or actions. Nevertheless, such a clause is, in my view, possible. It could have led to a more favourable outcome for the employer in this case.
Fourth, it is striking that the employer chose to rely on the redundancy of the employee’s position. Although the judgment does not fully clarify how the employee’s role relates to the reorganisation that had already taken place, it is clear that the employee was unfit for work. The prohibition on termination during illness therefore prevents dissolution, as the subdistrict court correctly notes. It is possible that the employer would have been more successful if it had not stated that the position would be made redundant. In that case, the absence of a valid permit would have remained as the sole ground for dismissal.
Conclusion
This ruling is a great example of the interaction between labour law and labor migration law, and shows that knowledge about (the proper) permits, combined with regular labour law, is essential. If you are considering hiring employees from outside the Netherlands or the EU or EEA, please feel free to get in touch. I would be happy to assist in assessing the situation and determining the appropriate course of action.
