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How do I terminate an open-ended employment contract?

Who can terminate the employment contract?

Both employer and employee can terminate an employment contract for an indefinite period.

How can one terminate the contract?

This can be done both by giving notice and by paying a termination fee.

How should the notice be given?

By the employer

  • By registered letter
  • By judicial bailiff

By the employee

  • Hand to hand
  • By registered letter
  • By bailiff's writ

When does the notice period begin?

For all employees, this is 'the Monday' following the week in which the notice was given.

Which notice period should be applied?

Employment contracts concluded as from 1 January 2014

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Employment contracts concluded before 1 January 2014

The calculation of the notice period for an employee who entered into service before 1 January 2014 must be done in 2 steps. Both periods must be added up afterwards to obtain the ultimate notice period.

Part I: Calculation of the notice period based on the seniority acquired on 31 December 2013

For white-collar workers a distinction is made between white-collar workers who are lower in rank (annual salary in 2013 is maximum 32.254 EUR) and white-collar workers who are higher in rank (annual salary in 2013 is higher than 32.254 EUR).

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If the dismissal is initiated by the employee, two limits apply to the notice periods to be observed:

When calculating step 1, the maximum notice period is already reached:

If the dismissal occurs on the employee's initiative, the notice period as obtained in step 2 (= as if the employee were to enter into service on 1 January 2014) does not have to be taken into account if the calculation in step 1 (= calculation of the seniority acquired on 31 December 2013) already results in a notice period of

  • For the lower level employees: maximum 3 months
  • For the higher level employees: maximum 4.5 months

In the above cases, only step 1 needs to be performed with a maximum of 3 or 4.5 months.

When calculating step 1, the maximum notice period is not reached:

If in the calculation of step 1 (= calculation of the seniority acquired on 31 December 2013) a notice period of 3 months (lower level employees) or 4.5 months (higher level employees) is NOT reached, step 2 needs to be performed. In case of dismissal by the employee, the total notice period after application of step 1 and step 2 can amount to a maximum of 13 weeks.

Therefore, there is a limit of maximum 13 weeks, even if a higher result is obtained after application of step 1 and step 2.

Part II: Calculation of the notice period in function of the seniority acquired as from 1 January 2014

The calculation of the notice period will be done according to the provisions that apply as from 1 January 2014 and as if the employee would enter into service on 1 January 2014. Every employee will start with 0 years of seniority on 1 January 2014.

Both periods (step 1 + step 2) should then be added up to obtain the final notice period

The notice period thus obtained also applies to the calculation of the indemnity in lieu of notice.

Decision

Both employer and employee can terminate an open-ended contract, but both parties should take into account the notice periods to be observed.

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Heidi Vergauwe

Dedicated and meticulous Payroll & HR Advisor, always willing to go for the extra (s)mile!