Redundancy pay reform plan under fire

Government plans to cut redundancy pay packages for people earning more than €75,000 a year are unfair and unnecessary, the council of state advisory body said on Monday.

The government wants to bring in a maximum pay-out of one year’s salary for high earners to make it cheaper for companies to sack staff.
But the council said the €75,000 limit was arbitary and unfair. A worker earning just below that figure would get a much higher pay-out – even if he or she had worked the same number of years as a colleague earning slightly more, the council said.
An extra cut in redundancy packages is also unnecessarily because district court judges have already amended the formula they use to calculate golden handshakes, the council said.
Age and length of service
Redundancy packages in the Netherlands are based on age and length of service, with a base line of one month’s salary for every year on the job for younger staff.
The council said the government has not explained how reducing golden handshakes for high earners is going to boost employment levels.
Despite the council’s criticism, social affairs minister Piet Hein Donner has sent the draft legislation to MPs for discussion, news agency ANP said.

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