What is a settlement agreement (VSO)?

A settlement agreement records the terms agreed by an employer and employee to end employment by mutual consent. Learn what it should contain and what to check before you sign.

What is a settlement agreement?

A settlement agreement – often referred to in Dutch as a vaststellingsovereenkomst or VSO – is a written agreement used to resolve a dispute or record agreed terms. In Dutch employment law, it is commonly used to end an employment contract by mutual consent.

Your employer may propose terms covering the termination date, severance pay, release from work duties, outstanding holiday entitlement, legal costs and full and final discharge. The wording can also affect your entitlement to Dutch unemployment benefits (WW). Do not sign until the terms and consequences are clear.

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Short answer

You are not required to accept a settlement agreement. You may have the proposal reviewed, request changes or refuse to sign.

After signing, an employee generally has a statutory 14-day cooling-off period under Dutch law.

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The essentials of a Dutch settlement agreement

Choose the topic that matches your question. Each page explains one aspect in detail.

Meaning and terminology

Learn what the different Dutch and English terms mean.

What the agreement should contain

See which terms a properly drafted agreement should contain.

What is included in a settlement agreement?

Reviewing the agreement and avoiding mistakes

Avoid unfavourable terms before you sign.

Your rights and negotiating position

Learn what you can request and how to respond to a proposal.

Key terms in a settlement agreement

Always check

Also consider

Non-compete and non-solicitation clauses, legal costs, references, pension arrangements, company property, confidentiality and full and final discharge can have significant consequences. A specialist can identify missing terms and provisions that should be improved.

More about reviewing your agreement

Examples and model documents

Example settlement agreement

Our specialists have prepared an example settlement agreement. You can adapt it to the specific terms agreed with your employer or employee.

Order the editable example settlement agreement below.

Model vaststellingsovereenkomst

€ 24,50

Sample response letter for employees

Your employer wants to terminate your employment contract and has offered you a settlement agreement. How should you respond? We have prepared a sample initial response letter. It confirms that you remain available for work and helps protect your entitlement to salary while requesting time to consider the proposal and obtain advice.

Order the sample letter below.

Voorbeeldbrief na aanbod vaststellingsovereenkomst

€ 19,50

About the author

Mr. Edwin van Jaarsveld

Edwin van Jaarsveld has over 20 years of experience with dismissal cases and regularly publishes about them.

Edwin’s expertise can also be found on:

Sign only when your settlement agreement is legally sound

Have the terms concerning WW benefits, the termination date, compensation and restrictive clauses reviewed before the cooling-off period or response deadline expires.

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Frequently asked questions about settlement agreements

Do I have to sign a settlement agreement?

No. You do not have to sign the proposal. You may obtain legal advice, negotiate changes or refuse the proposal.

Will I be entitled to Dutch unemployment benefits after signing?

Possibly, but the agreement must satisfy the conditions applied by UWV. The employer’s initiative, the reason for dismissal, the notice period and the termination date are particularly important.

How long is the cooling-off period?

After signing, an employee generally has a 14-day statutory cooling-off period. If the agreement does not state this right in writing, the period generally extends to 21 days.

What severance payment can I negotiate?

When employment ends by mutual consent, the statutory transition payment is not automatically due. However, the employer and employee may agree a severance payment, often using the statutory transition-payment calculation as a negotiating reference.

When should I have my settlement agreement reviewed?

Preferably before you sign. Have short response deadlines and verbal promises reviewed as well, and ensure all important terms are recorded in writing.

Reviews

Professional advice

Rishico

Your dismissal specialists helped me very well with professional advice following a labor dispute I had with my employer. They clearly have experience with settlement agreements. I definitely needed their assistance to reach a good agreement with my employer. Thank you for the clear communication and all the help!

My thanks

Carla ten Bulte

My thanks to Mr. Geradts,

With great professionalism, decisiveness, speed, and effectiveness, I was able to conclude a good settlement agreement. If your first counteroffer hadn’t been so strong, I wouldn’t have been able to secure even half of it.
Not only because of the money, but certainly also to be able to close my employment history with dignity.
I wish every employee in such a situation could have such a skilled lawyer!

Good severance payment

Metternich

I want to sincerely thank you for the excellent help I received when my employer wanted to terminate my employment contract with a settlement agreement.
You advised me not to sign the agreement and, through negotiations, secured my unemployment benefits and severance payment.

Good advice

Louman

We are an employer in a cyclical industry. Sometimes there is plenty of work, other times too little.
Therefore, we regularly have to part ways with employees for “economic reasons.”
We use the services of vaststellingsovereenkomst.org for this. They know exactly how a dismissal request to the CWI or the subdistrict court should be prepared.

Even in cases where an employee underperforms or behaves inappropriately, we have had good experiences with the lawyers at vaststellingsovereenkomst.org.
They are always available to us with sound advice and have never disappointed us.

Difficult situation

Singh

A dismissal specialist helped me in a very difficult situation. I had been so foolish to sign a letter in an emotional state, resigning myself. Because of this, I lost my salary and wasn’t entitled to unemployment benefits. Vaststellingsovereenkomst.org managed to reverse this. They were able to prove that I signed under pressure and didn’t fully understand what I was doing.
In the end, I left with a good severance payment and now I have another job. Without the help of Vaststellingsovereenkomst.org, I would be in serious financial trouble right now.

Higher severance payment

Gast

I would like to sincerely thank you for the quick and professional assistance.
My employer unexpectedly presented a settlement agreement to terminate my employment contract, but thanks to your help, I received a higher severance payment and compensation for my vacation days.

Excellent assistance provided

Thijssen

Recently, you helped me with my dismissal case. I am very satisfied with the assistance provided. The lawyer was very involved and well-versed in dismissal law. He understood well that I didn’t want a long procedure but wanted the matter resolved quickly.
That solution came swiftly and to my full satisfaction. I didn’t even have to visit your office. Communication was handled by phone and email, so you were always accessible.
My rating: a solid 10.

Dismissed but still well helped

A. van den Berg

Because of a conflict at work that got seriously out of hand, I was dismissed immediately (summary dismissal). I had behaved badly during that conflict, so I could understand why my boss took such a harsh measure.
But I still had to fight the dismissal, because I had no job and no right to unemployment benefits. Fortunately, the dismissal specialist dared to take the risk and started a procedure against my employer on a No Cure No Pay basis. Without the possibility of No Cure No Pay, I wouldn’t have dared to do it myself.
In the end, after two procedures, the lawyer from vaststellingsovereenkomst.org succeeded in securing my right to unemployment benefits and even a severance payment.

Dismissal assistance

van Vliet-Houtman

I worked with great pleasure from the age of 18 at a flower exporter in Aalsmeer.
When I was 54, my employer applied for dismissal through the CWI for economic reasons. At that time, I engaged Mr. Edwin van Jaarsveld from Ontslagspecialist for dismissal assistance.
A dismissal permit could not be avoided because my employer was really in financial trouble. Since my employer offered only a very small severance payment, Mr. van Jaarsveld advised me to start proceedings at the subdistrict court.
That turned out to be successful. The court awarded a severance payment of €94,000.
Thanks to the dedication and excellent legal knowledge of vaststellingsovereenkomst.org, I achieved this great result. Kudos!

Very pleasant experience

Rachel Waki

We are an international company based in Amsterdam. We have engaged Vaststellingsovereenkomst.org as our regular legal counsel and legal assistance for business matters. They successfully concluded our first legal case immediately.
I have found the collaboration with the lawyers at Vaststellingsovereenkomst.org to be very pleasant. We complement each other well regarding key issues and evidence.
Rarely have I experienced such excellent legal service and attention. I would definitely recommend Vaststellingsovereenkomst.org in every respect; their rates are also very reasonable!

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