ACCESS NL > Dual careers in the Netherlands > Working in the Netherlands > Unemployment in the Netherlands > What is the transitievergoeding (transition compensation)? And do I qualify for it?

Unemployment in the Netherlands

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What is the transitievergoeding (transition compensation)? And do I qualify for it?

As of 1 July 2015, the transitievergoeding (transition compensation) was introduced. This compensation replaces the severance payment in cases of termination of an employment contract by the employer either via a court or the Government’s Employee Insurance Agency (Uitvoeringsinstituut Werknemersverzekeringen – UWV).

You are entitled to a transition allowance if you are dismissed or if the temporary contract is not renewed on your employer’s initiative. This right also exists if you resign yourself due to serious culpable acts or omissions on the part of your employer.
From 1 January 2020, you are entitled to a transition payment upon dismissal from the first day of your employment contract. The transition compensation is calculated as follows:

From your first working day, you will receive 1/3 monthly salary per entire year of service.
The transition payment for the remaining part of the employment contract is calculated according to the formula: (gross salary received on the remaining part of the employment contract / gross monthly salary) x (1/3 gross monthly salary / 12). This formula is also used to calculate the transition allowance if the employment contract has lasted less than a year.

Example: An employee is dismissed during his probationary period. The employment contract lasted a total of 5 days. The gross salary over these 5 days is € 800. This is considered as the monthly wages.
The calculation is then as follows: (€ 800 / € 800) x (1/3 x € 800) / 12) = 1 x (€ 266.67 / 12) = € 22.22. The employee will, therefore, receive € 22.22 transition compensation for the 5 days that he was employed.

If the dismissal took place after 1 January 2020, you can make use of the Transition Allowance Calculation Tool (in Dutch only) on

There are some exceptional cases in which the transition compensation does not apply, as follows:

  • you are less than 18 years of age on dismissal and you have not worked more than 12 hours per week during your employment,
  • your temporary contract is expiring, and you and your employer agree in advance that your contract will be continued within a maximum of six months and that the new contract can be terminated prematurely,
  • your employer is bankrupt, has a moratorium, or is involved in a debt rescheduling scheme for natural persons,
  • you have reached the age of retirement,
  • you have been dismissed due to a serious culpable act such as theft or fraud,
  • your collective labour agreement (collectieve arbeidsovereenkomst – CAO) contains an equivalent provision for a transition payment.

For further information, please visit the government’s website (in Dutch only):

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