Reorganization and collective dismissal

Changes within your company due to economic circumstances, technological innovations, or strategic decisions may necessitate a reorganization. In such cases, it may be unavoidable for you to part ways with one or more employees. This is legally complex and requires careful preparation.

When is reorganization permitted?

For a legally valid dismissal due to reorganization, there must be a business economic necessity. This may stem from a reduction in work, financial problems, or internal restructuring. You must be able to substantiate this necessity with relevant documents, such as financial statements or organizational reports.

Legal steps in reorganization

A reorganization process follows specific steps, in which we can provide you with complete guidance:

• Reflection principle: To determine who is surplus, you must apply this principle. Employees are ranked by age category and function, with those having the shortest tenure being the first eligible for dismissal.
• Obligation to redeploy: You must demonstrate that there is no suitable, available position within the organization where the surplus employee can be redeployed.
• Settlement agreement or UWV procedure: Typically, you first offer a settlement agreement. If an agreement cannot be reached, a dismissal application to the UWV follows.

Collective dismissal and obligations

Is there a case of dismissing 20 or more employees within three months? Then the Collective Dismissal Notification Act (WMCO) applies. You must report timely to the UWV and consult with trade unions. This often results in a social plan, which outlines severance payments and support for finding new work. The works council (or employee representation) must also be consulted.

Expert support from start to finish

A reorganization affects not only your organization but also your employees. Correctly navigating this process prevents delays, conflicts, and legal risks. Our labor law specialists have extensive experience with reorganization processes, social plans, and UWV procedures.

Considering a reorganization or collective dismissal? Contact us for expert and practical legal advice.