Consequences of Invalid Summary Dismissal

When a cantonal court annuls summary dismissal for misconduct, severe sanctions take effect for the employer. Article 7:686 DCC provides the employee with options: reinstatement of the employment contract or compensation for damages.

Reinstatement of the Employment Relationship

In the event of a successful claim, the employer must reinstate the employee within four weeks with retroactive effect. Salary, holiday pay and benefits must be paid retroactively up to the judgment. Refusal leads to a fine of up to €20,000 per day (Article 7:683(6) DCC).

Alternative Compensation

If the employee opts for money, this amounts to at least the transition payment plus 1/3 monthly salary per year worked, with a maximum of two additional monthly salaries. In Ballast Nedam/Employee, the court awarded €150,000 due to lost income.

Practical Challenges

Reinstatement is often unworkable due to disrupted relations, leading to negotiations or settlement agreement. Employers risk high costs and reputational damage.

Tips for Employers

Document everything and consider mediation. Employees must proceed quickly within two months. This article outlines the financial and relational risks of a failed dismissal. (199 words)