Your employer is offering you a settlement agreement while you are ill. This is a crucial moment. Signing can have major consequences for your unemployment benefits, sickness benefits, and future WIA (disability benefits). Never sign without professional assessment.
You are at home sick. Perhaps for weeks, perhaps for months. And then you receive a letter or email from your employer: a settlement agreement. With the proposal to end your employment contract "by mutual consent."
This is often presented as a good solution. A compensation, a neat conclusion, no more hassle. But what it does not say: the enormous risks you run if you are sick at the time of signing.
A settlement agreement during illness is very different from a settlement agreement when you are healthy. The UWV assesses each situation individually and can refuse your benefits if circumstances warrant it.
The difference between a well-assessed settlement agreement and one signed hastily can be tens of thousands of euros in missed benefits.
The UWV assesses every settlement agreement submitted with an unemployment or sickness benefits application. Stricter requirements apply during illness.
If you sign a settlement agreement while you are ill, the UWV can rule that you are "culpably unemployed." The UWV reasons: you should not have signed, because you cannot receive unemployment benefits if you are not available for work. Result: no unemployment benefits.
If you leave employment while ill, you normally fall under the Sickness Benefits Act. But with a settlement agreement, the UWV can rule that you deliberately contributed to your own unemployment during illness. Then you may not receive sickness benefits either.
If you are already heading toward 104 weeks of illness, you are in a WIA trajectory. A settlement agreement can affect this: salary payments end earlier and you may fall under the Sickness Benefits Act. The effect on your WIA assessment depends on the specific situation.
After signing a settlement agreement, you legally have 14 days reflection time. Within this period, you can withdraw your decision in writing, without giving reasons. The agreement is then dissolved.
If the reflection period is not mentioned in the settlement agreement, it is automatically extended to 21 days. But note: this reflection period is intended as a last safety net, not as an excuse to sign hastily.
It is always better to have the settlement agreement assessed before signing than to have to use the reflection period afterwards. If you use the reflection period, the working relationship is often damaged and you are back to square one.
Important: the law has limitations on repeated use of the reflection period. If you have previously dissolved a settlement agreement via the reflection period, inquire about your current rights.
There are situations where a settlement agreement during illness CAN be wise. This requires careful assessment.
If you became ill due to the work situation (conflict, intimidation, unsafe situation) and recovery is only possible if the employment relationship ends, signing can be the right choice. The UWV sometimes accepts this as a valid reason, but this is not automatic and depends on medical substantiation.
If you have been sick for two years, the dismissal prohibition lapses. Your employer can then apply for a dismissal permit from the UWV. A settlement agreement can then be more advantageous, but note: depending on your WIA or Sickness Benefits situation, there may still be risks.
In some cases, you can report yourself recovered well before the end date in the settlement agreement. You are then no longer sick at the time you leave employment, so you do build up unemployment benefit rights. This requires precise timing and legal guidance - there is no fixed statutory term.
If the company doctor has ruled that you will be fully recovered in the short term and the end date is far enough in the future, a settlement agreement may be safe. The end date must then be after your expected recovery.
To avoid unemployment benefit problems, a settlement agreement must meet specific conditions.
Upon dismissal, you have a statutory right to a transition payment (1/3 monthly salary per year of service). With a settlement agreement, this must be explicitly agreed - it does not arise automatically. Negotiate about this.
During illness, you have a strong position due to the dismissal prohibition. Your employer cannot dismiss you, so if they want to get rid of you, they have to pay. Negotiate a higher compensation.
In addition to compensation, you can negotiate about: longer exemption from work, lapse of non-compete clause, positive reference letter, outplacement budget, reimbursement of legal costs.
Your employer or HR puts pressure. They say the proposal only applies now, or that the compensation will be lower if you do not sign quickly.
This is a pressure tactic. You are not obliged to anything. Take time to have the settlement agreement assessed. A serious employer gives you that space.
The employer threatens dismissal via the subdistrict court if you do not sign.
During the first two years of illness, dismissal is impossible in many cases due to the dismissal prohibition. The subdistrict court often rejects dissolution requests during illness, unless the grounds are unrelated to the illness. This is usually a pressure tactic.
It seems like a good offer: more than you are legally entitled to.
Calculate what you lose. If this settlement agreement means you do not get unemployment or sickness benefits, you often lose much more than the "extra" compensation. Plus: you may be able to negotiate even more.
The suggestion that a settlement agreement is neater for your CV and helps you avoid dismissal procedures.
Dismissal during illness is almost impossible. You do not have to sign a settlement agreement to avoid dismissal. You are already protected by the dismissal prohibition. A bad settlement agreement can be more harmful than no agreement at all.
A settlement agreement during illness is one of the most risky documents you can sign. The consequences of a wrong decision can affect you for years in missed benefits.
MediRights assesses every settlement agreement for the specific risks in your situation. We look at your illness history, your reintegration file, your expected recovery time, and the financial consequences of signing versus not signing.
We negotiate with your employer for better conditions. Higher compensation, longer term, better wording for the UWV. Your employer knows you are protected by the dismissal prohibition, so if they really want you to sign, they will have to move.
Only when the settlement agreement meets all requirements and the risks are acceptable do we advise about signing. And even then you still have 14 days reflection time.
Have it assessed before you sign. One wrong signature can cost thousands of euros.
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