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Publication ⸱ 13-03-2016

Ragetlie rule

The so-called Ragetlie rule provides that if an employment contract entered into for an indefinite period, which has ended other than by legally valid notice of termination or by court dissolution, has been continued once or more by a fixed-term employment contract at intervals not exceeding three months, the continued employment contract does not end by operation of law.

With the introduction of the Work and Security Act (WWZ), the interruption period was extended from three months to six months. In addition, the new regulation expresses that the Ragetlie rule only does not apply if the employment contract is terminated by notice as referred to in Section 7:671(1)(a) to (h) of the Civil Code or by dissolution by the court. This makes it clear that the Ragetlie rule does apply to a termination by mutual consent, to a termination at the initiative of the employer to which the employee has agreed and to a termination by the employee himself.

Furthermore, the Ragetlie rule no longer applies if the employment contract is terminated for an indefinite period due to the employee reaching retirement age ‘by virtue of a clause to that effect’. Pensionable age refers to the state retirement age or another pensionable age. A pensionable age other than the AOW pensionable age may mean a higher (than the AOW) pensionable age or a lower (than the AOW) pensionable age. Agreeing on a lower pensionable age (than the state pensionable age) is only allowed if it does not violate the Equal Treatment in Employment by Age Act.

It is worth noting that even without this exception, the Ragetlie rule on continuing to work after retirement age will not easily pose a problem anymore. After all, since 1 July 2015, the employer can terminate an employee’s employment contract by the day the employee becomes entitled to a state pension or by a later date, provided the employment contract was entered into before reaching the state pension age. The employee’s consent or going to the UWV or the subdistrict court is then not necessary.

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