Dismissal Due to Reorganization: Rights, Process and Outplacement

Dismissal due to reorganization means that an employee loses their job as a direct result of structural company changes. Common reasons include economic circumstances, efficiency drives or market shifts. This article explains what dismissal due to reorganization entails, employee rights, employer obligations, and the supportive role of outplacement services.

What is dismissal due to reorganization and why does it occur?

Dismissal due to reorganization happens when an employer restructures the organization, processes or workforce. This is often triggered by financial setbacks, mergers, or shifting priorities. Functions may disappear or employees are declared redundant. The dismissal is not personal but a direct result of organizational changes.

For example, if a municipality merges and similar roles are combined, some employees become redundant. Dutch employers must comply with strict rules, such as the reflection principle (afspiegelingsbeginsel), unless an exception applies.

The UWV checks if the dismissal is justified and whether all legal requirements are met. This legal framework ensures procedural care and consideration for employee interests.

The reflection principle and selection for dismissal

The reflection principle determines who is selected for dismissal. Employees are categorized by function and grouped by age. Those with temporary contracts are considered first, followed by a balanced selection based on age structure within each category.

Example: In a team of five administrative staff, two positions must be cut. Staff are divided by age group and contract type, objectively deciding who stays. This maintains transparency and avoids arbitrary choices.

Applying these rules is complex, so organizations often seek HR expertise for correct implementation. This minimizes legal disputes and uncertainty for affected employees.

Employee rights during dismissal due to reorganization

Employees are entitled to a transition payment, support towards new work and full transparency from the employer. The transition payment is designed to facilitate the move to another job, with the amount based on years of service and gross monthly salary.

Employers must also actively investigate possible redeployment within the organization before proceeding with dismissal. Sometimes a settlement agreement is offered, outlining the terms of departure.

Employees may seek advice from legal or union representatives to protect their rights and ensure fair treatment.

Outplacement as a supportive solution after dismissal

Outplacement provides customized guidance for employees who lose their jobs due to reorganization. The aim is to help them find new, suitable work outside their current employer. Outplacement includes career coaching, application training, and emotional support.

For instance, an employee with twenty years at a healthcare organization receives outplacement support. Together with a coach, she explores suitable roles, updates her CV, and prepares for interviews.

While outplacement is not legally required, it is often part of a social plan. Employers who include it demonstrate care for their staff and increase the chances of a successful transition.

The importance of clear communication during the reorganization process

Clear, transparent communication is crucial throughout a reorganization. Employees need to understand the process, criteria, and timelines. Lack of clarity causes stress, reduced motivation, and sometimes absenteeism.

For example, management may organize an information session to explain procedures, criteria, and next steps, encouraging questions to address uncertainties immediately.

Timely announcements, department-specific updates, and one-on-one meetings contribute to a careful and respectful process.

UWV procedure and dismissal application

In case of dismissal due to reorganization, employers must apply for a dismissal permit at the UWV. The UWV evaluates the legitimacy of economic reasons and the proper application of rules. Employees may object, for example, if the reflection principle is incorrectly applied.

The UWV procedure includes submitting an application, providing evidence, and granting the employee an opportunity to respond. Consultations with the works council and unions often shape the social plan and redeployment options.

Once approved by the UWV, the employment contract is terminated with due notice. The notice period for permanent contracts must be observed.

Redeployment and alternatives to dismissal

Before dismissal, the employer is legally obliged to investigate redeployment opportunities within the organization. This may involve offering a different suitable role, sometimes after training or retraining.

Example: An employee whose role is redundant is retrained for a different position in another department, avoiding forced redundancy. Only when no realistic alternative exists can dismissal proceed.

The UWV closely examines if the redeployment obligation is fulfilled, requiring employers to demonstrate serious efforts to retain staff where possible.

Financial and emotional impact of dismissal due to reorganization

Dismissal due to reorganization has significant financial consequences. In addition to loss of income, employees may face uncertainty around new employment and benefits. The transition payment offers some relief but may not be sufficient.

Emotionally, people often experience loss of security, daily structure and self-esteem. Outplacement helps not only with practical job search but also with emotional processing. Regular sessions with coaches and peers help restore perspective and motivation.

Information about the final settlement and end-of-employment arrangements is crucial so employees know where they stand.

Specific considerations during reorganization dismissal

Additional factors may apply, such as long-term illness, temporary contracts or special protection. For example, employees who are ill during a reorganization have extra dismissal protection. Knowledge of notice periods and transition payments is important in these cases.

Various types of guidance are available, tailored to age, sector or personal needs. The article on outplacement in the event of dismissal provides further insights into these support paths.

Those who wish to become self-employed after reorganization can find additional information in outplacement for starting as a freelancer.

Practical steps during the reorganization dismissal process

The process follows several key stages: announcement of the reorganization, consultation with the works council, drafting of a social plan, objective selection of staff, UWV dismissal application and communication to those affected.

After official notice, the guidance phase starts. Outplacement is often the logical next step, as detailed in how an outplacement process unfolds. This explains the practical steps taken by employees and their coaches.

Employees are advised to review their situation both legally and financially. Early involvement of a career coach can support a smooth transition to new work.

Summary

Dismissal due to reorganization is a profound process with major consequences for both employee and employer. Clear communication, correct application of the reflection principle, serious redeployment efforts and proper legal procedures are essential. Outplacement provides support and perspective in building a new future outside the organization. With a careful and human approach, employees can move forward despite the challenges of a reorganization.