Dormant employment after illness: end it or keep it?

Dormant employment after illness: end it or keep it?

After long-term illness, your employment contract may continue while the ordinary period of continued pay has ended and you are not working. This is often called dormant employment (slapend dienstverband). The contract has not automatically ended. Subject to conditions, you can ask for termination with compensation. At the same time, consider realistic return-to-work prospects, benefits and pension. A decision about the contract should reflect your current situation rather than only the amount offered on departure.

Two years of illness does not automatically end the employment contract.

The Xella principle may require the employer to cooperate with termination.

Employer reimbursement and your own entitlement are separate questions.

Is the employment relationship actually dormant?

First check whether the pay period has expired, whether a continued-pay sanction applies and whether any work is still being performed. A WIA decision alone does not give a complete answer. If you have partly resumed work or new suitable tasks exist, the position may differ from what the everyday term “dormant” suggests. Ask in writing which obligations the employer considers ongoing. Keep the first sickness date, UWV decisions and current occupational physician advice. This prevents a termination discussion starting from an incorrect assumption about pay or capacity for work.

The Supreme Court’s Xella principle

In 2019, the Supreme Court held that good employment practice generally requires an employer, on request, to cooperate with ending dormant employment and pay compensation equal to the relevant statutory transition payment. This principle is linked to the conditions for dismissal due to long-term incapacity and has exceptions for justified interests. A realistic prospect of reintegration may make a difference, for example. Have it assessed whether your situation falls within the principle rather than simply making a general reference to “Xella”.

Realistic reintegration requires more than a vague possibility

Ask which specific jobs or tasks are available, what demands they involve and when a return is expected to be possible. Compare this with current medical and occupational assessments. An employer wishing to keep the contract must be able to make a claimed reintegration opportunity specific. Conversely, keeping it may be valuable to you if suitable work is genuinely available. Distinguish a serious return-to-work route from an abstract argument that you might recover someday. A current assessment is more helpful than an old report without a concrete work option.

Make a specific written request for termination

Ensure the request matches the conditions and relevant date in your situation. Ask for an itemised calculation and written response. Sending your own resignation letter is different from proposing a compensated termination by agreement. Do not inadvertently resign unilaterally when you want to discuss compensation. Check the final proposal too: end date, payment, final accounts and full and final settlement each require attention. An employer saying there is “no budget” does not answer all the legal questions.

The calculation date can be important

In dormant employment, every later calendar month is not necessarily included in the compensation that must be offered under the Xella principle. The relevant date and applicable historical rules require a specific calculation. Collect pay details, first sickness date, end of the waiting period and any earlier contracts. Do not compare an offer solely with an online calculator assuming termination today. A calculator is indicative; the legal basis determines the date, pay base and duration relevant to your claim.

Assess employer reimbursement and legislative plans separately

Under current conditions, employers may apply for reimbursement of transition payments paid. According to current government information, the proposed abolition has been postponed to 1 January 2028 and still has to pass through the legislative process. Older reports mention earlier dates. Do not treat that plan as though your entitlement had already disappeared in October 2026. The employer’s reimbursement application is also different from your payment entitlement. For a future termination, have the applicable scheme and transitional rules checked again rather than relying on an old policy announcement. UWV gives the employer six months after payment of the transition compensation to apply. That is the employer’s reimbursement deadline, not your deadline for claiming payment. Obtain a separate payment agreement and have your own remedy checked; “UWV must pay first” does not describe this sequence.

Check income, pension and final accounts

Discuss what ending the contract means for a current WIA or other benefit, insurance, pension and any contribution-free accrual. Ask where those consequences can be confirmed. Also check outstanding wages, annual leave hours and holiday allowance, taking account of the period over which they actually accrued. A general final payment is not necessarily complete settlement. Ask for a breakdown and payment date. If agreement is not reached, have the appropriate claim or procedure and associated deadlines assessed; ordinary dismissal deadlines may differ from those for a damages claim.

Example: keeping the contract without specific work

After the waiting period, your employer pays no wages and says you will remain employed “just in case”. There is no new advice and no task proposal. Ask for the specific reintegration reason and have it assessed whether a termination proposal with compensation is appropriate. If you would like to return, ask instead for a current investigation of the possibilities. Both choices require facts. The example shows why a dormant contract is not merely an administrative status: it involves a real choice about work, income and settlement.

Collect the first sickness date, end of the waiting period and current UWV decisions.

Investigate whether realistic suitable work is available.

Have the legal basis, calculation date and termination proposal assessed.

Check benefits, pension, final accounts and payment arrangements.

Does my employment automatically end after two years of illness?

No. The end of continued pay, a WIA decision and the end of the employment contract are separate events.

Must I resign to receive compensation?

Unilateral resignation is a different act and may harm your position. Have a specific termination proposal drafted or reviewed.

Can the employer refuse because I might return?

A justified interest, such as a realistic prospect of reintegration, may matter. Ask which specific facts and current advice support it.

Has employer reimbursement already been abolished?

On the checking date, current government information refers to proposed abolition from 2028. The proposal’s status and future transitional rules must be checked again.

Sources and editorial notes
Sources current as of: October 17, 2026
1. Supreme Court: ending dormant employment and Xella
Publisher: Hoge Raad der Nederlanden
https://www.hogeraad.nl/actueel/nieuwsoverzicht/2019/november/hoge-raad-verplicht-einde-slapend-dienstverband-0/
2. UWV: reimbursement of transition payments for long-term illness
Publisher: UWV
https://www.uwv.nl/nl/ontslag/compensatie-transitievergoeding-langdurige-arbeidsongeschiktheid
3. Ondernemersplein: proposed abolition of reimbursement from 2028
Publisher: Ondernemersplein · Overheid.nl
https://ondernemersplein.overheid.nl/wetswijzigingen/compensatie-voor-transitievergoeding-verdwijnt/
The source publications are in Dutch. All language editions cover Dutch law.