In the Netherlands, a secondment provision in a collective labour agreement (CLA) concerning the treatment of ill workers has been established practice for some time. This provision applies as a matter of course to secondment workers who have worked for the secondment agency for a period of fewer than 78 weeks, unless its application is specifically excluded in writing. Under this provision, the secondment contract ends when the firm doing the hiring is no longer able or willing to hire in the worker. Secondment CLAs also specify that the contract terminates if the worker can no longer perform work because they are sick. The secondment contract then ends immediately after the worker has reported an injury or illness. At least, that was the understanding until recently.

Background

On March 17, 2020, the Court of Appeal in The Hague issued a remarkable judgment in relation to the use of the secondment provision when a worker falls ill. In that case, the secondment worker injured his hand in a machine at work and was therefore subject to employment disability. The secondment agency refused to continue paying wages and relied upon the secondment provision in the applicable CLA. The agreement stated that the secondment worker’s employment contract with the secondment agency ends automatically at the point when the worker falls sick or has an accident at work if they can no longer perform work.

Interpretation of the Employment and Security Act

Rather than rely solely on the CLA, the Court of Appeal also looked to the Employment and Security Act (WWZ), which took effect on July 1, 2015. That law generally banned employers from terminating an employment contract during illness. But, under prior interpretation of the law, it was possible to contract out of that provision in the CLA in question (the NBBU CLA) for seconded workers.

The Court of Appeal honed in on the discrepancy there, holding that the Employment and Security Act eliminated the option for the CLA to deviate from the ban on terminating employment during sickness. It found that immediate termination of the secondment contract because a worker had suffered an accident at work was directly contrary to the law’s ban on termination during sickness. According to the Court of Appeal, the secondment provision has been voidable since July 1, 2015 in the event of sickness or employment disability.

Ramifications for Agencies

The Court of Appeal held that secondment contracts containing the secondment provision no longer end automatically when the seconded worker becomes sick. The employment contract with the secondment agency continues until it comes to an end in some lawful manner.

The Court of Appeal’s judgment has ramifications for the continued payment of wages to sick secondment workers. Because the secondment contract containing a secondment provision ended automatically on sickness until prior interpretations, the obligation to continue paying wages on sickness only arose after a seconded worker had been working for 78 weeks. Now that the Court of Appeal considers the use of the secondment provision during injury or sickness to be voidable, the obligation to continue paying wages might well arise before the secondment worker has been working for 78 weeks. This obligation would appear to terminate only when the secondment contract is lawfully ended, such as by operation of law after a fixed term.

To summarise, secondment agencies can no longer rely exclusively on the effectiveness of the secondment provision. Going forward, they may benefit from explicitly entering into secondment contracts for a fixed term, in order to clarify the scope of the employment arrangement for all parties involved and to limit potential claims for continued wage payment obligations in the event of injury or sickness.