Fixed Term Employment Contract Conversion to Permanent Employment Contract

Labour Law per January 1, 2020

Since January 1, 2020, a temporary (fixed term) employment contract automatically converses to a permanent employment contract if the employee has received more than 3 consecutive fixed term employment contracts. Or if the employee has had several temporary contracts with his employer for more than 3 years.
NOTE: if the company has a Collective labour Agreement [CAO], please refer to this agreement. 

 

Three (3) consecutive fixed term employment contracts = Permanent employment contract

The employee automatically receives a permanent employment contract if:

  • More than 3 fixed term employment contracts have been agreed with the same employer, or;
  • More than 3 fixed term contracts for the same type of work with subsequent employers. (For example, employee worked via an employment agency at the employer and afterwards will directly be employed at the employer, and;
  • The interval between employment contracts is maximum 6 months.
  • For temporary recurring work (not limited to seasonal work) that can be done for a maximum of 9 months per year, there is a maximum of 3 months interval between employment contracts. However, this must be included in the CLA, and;
  • The 3rd employment contract will end on or after January 1, 2020, and;
  • There are no other conditions in the collective agreement, as the agreements in the collective agreement will prevail.

The employment contract ending on or after January 1, 2020, the (new) chain provision of three (3) years applies. Even though the employment contract was entered into before 1 January 2020.

Example:

The first employment contract was entered April 1, 2018 to October 1,  2018 – a duration of 6 months. The second employment contract was a fixed employment contract for 1 year from October 1, 2018 to October 1, 2019. The third employment contract was as a fixed employment contract for 1 year from 1 October 2019 to 1 October 2020.

  • Although the third employment contract exceeds the date of the law change January 1, 2020, currently there are 3 employment contracts provided and not more than 3 temporary contracts.
  • In addition, the two-year contract duration (previous regulation) has not yet been exceeded on the reference date of January 1, 2020. As a result of the law change, the employee is therefore not yet entitled to a permanent contract.

 

Three (3) fixed term employment contracts = Permanent employment contract

The employee automatically receives a permanent employment contract if:

  • Employee has received several temporary employment contracts with the same employer for more than three (3) years. Or for the same type of work with successive employers. For example, employee worked via an employment agency at the employer and afterwards will directly be employed at the employer, and;
  • The interval between employment contracts is maximum six (6) months.
  • For temporary recurring work (not limited to seasonal work) that can be done for a maximum of nine (9) months per year, there is a maximum of three (3) months interval between employment contracts. However, this must be included in the CLA, and;
  • There are no other conditions in the collective agreement, as the agreements in the collective agreement will prevail.

The employment contract ending on or after January 1, 2020, the (new) chain provision of three (3) years applies. Even though the employment contract was entered into before January 1, 2020.

Examples:

Example 1: Employee signed a one (1) year employment contract from October 1, 2018 to October 1, 2019. After that, the employee received a second employment contract for the duration of one and a half (1.5) years, from October 1, 2019 to April 1, 2021. The employment contract was entered before January 1, 2020, but on the reference date January 1, 2020, the duration of two (2) years has not yet been exceeded (the moment is after January 1, 2020). The 3-year chain provision applies. As a result, the second employment contract remains a fixed-term employment contract and does not have to conversed to a permanent employment contract.

Example 2: Employee signed a one (1) year employment contract from January 1, 2018 to December 31, 2018. After that, the employee received a second employment contract for the same duration, from January 1, 2019 to December 31, 2019. On the reference date, January 1, 2020, the duration has not exceeded two (2) years and no entitlement to a permanent employment contract arises. The 3-year chain provision applies to the employment contract entered into on January 1, 2020.

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