Dismissal legislation and the transition payment in the Netherlands: Towards employment security?

The purpose of protection against dismissal is to protect the employee against unjustified dismissal, which is expected to lead to stable employment relationships and job security. In recent years, the concept of employment security has entered the world of policy and science. This article aims to
contribute to the field of labour law by investigating the objectives and effects of the Dutch transition payment process in relation to the relatively new notion of employment security. To do so, the ins and outs of the Dutch transition payment process are discussed. We compare and analyse the Dutch dismissal law before and after the introduction of the Work and Security Act (Wet werk en zekerheid (WWZ)) on 1 July 2015. We discuss the (unintended) employer and employee effects of dismissal law reform in the Netherlands and we analyse the objectives of the transition payment in relation to employment security. Based on a large-scale survey of redundant employees we shed light on the question of whether the transition payment is used for the purpose intended by the legislature. This article concludes by discussing the changes to the transition payment and dismissal compensation with the introduction of the new Balanced Labour Market
Act (Wet arbeidsmarkt in balans (WAB)) on 1 January 2020. Although the legislature has attributed a clear formal transition function to the transition payment, the transition function is lacking from a substantive law perspective and we conclude that employment security is still in its infancy in Dutch
dismissal legislation.