You have received a settlement agreement and your employer’s offer doesn’t feel right. The transition payment seems too low, but you’re not sure whether that’s correct or what you can do about it. Good news: in many cases there is more room than you think, and with a settlement agreement in particular you are in a stronger position than in a formal dismissal procedure.
Statutory right to a transition payment in a settlement agreement
When dismissed via the UWV or the subdistrict court, you have a statutory right to a transition payment. With a settlement agreement the legal position is slightly different: you agree to a mutual termination, and with that the strict statutory right to the payment lapses. Nevertheless, almost every employer offers a transition payment as part of a settlement agreement, simply because otherwise you have no obligation to cooperate. That gives you negotiating room.
The statutory transition payment in 2026 amounts to one third of a monthly salary for each year of service. The statutory maximum in 2026 has been set at €102,000 gross, or one gross annual salary if that is higher. That maximum was increased on 1 January 2026 compared with the €98,000 that applied in 2025. Check whether the amount in your settlement agreement is in line with this.
Common errors in the calculation
A transition payment that is too low is far from always intentional. Employers regularly use an incorrect basis for the calculation, meaning you systematically receive less than you are entitled to. Knowing the most common errors helps you check more effectively.
- Excluding holiday pay: holiday pay (standard 8% of gross monthly salary) must be included in the calculation basis. Many employers leave this out.
- Forgetting fixed allowances: structural shift or irregular-hours allowances form part of the monthly salary for calculation purposes.
- Rounding the length of service instead of calculating to the day: since 2020, the exact length of service is calculated to the day, including partial periods.
- Not including a 13th month or fixed bonus: a year-end payment that is paid on a structural basis also counts towards the calculation basis.
- Incorrect hourly rate during illness: if you were dismissed following a period of long-term illness, the calculation must be based on your original salary, not the reduced sick-pay salary.
When is the offered payment too low
An offer below the statutory transition payment is, in most cases, not reasonable. The reasoning is straightforward: if your employer had followed the route via the UWV or the subdistrict court, they would have been liable for the statutory payment regardless. A settlement agreement offer below that level therefore effectively worsens your position.
Moreover, with a settlement agreement things need not stop at the statutory transition payment. During negotiations it is possible, for example, to work with the higher pre-2020 calculation method, which can produce a considerably higher figure in certain situations. Other factors such as the strength of your employer’s dismissal file, the length of your service, and the grounds for dismissal also play a role in what you can negotiate.
Plan een vrijblijvend gesprek en ontdek wat we voor je kunnen betekenen.
Plan een gesprekYour cooling-off period and the right to withdraw
Have you already signed? You still have a statutory two-week period in which to withdraw from the settlement agreement, without needing to give a reason. Do not let yourself be rushed by pressure from your employer. Some employers try to get you to sign quickly, precisely at the moment when you are emotionally affected by the news of your dismissal. That is understandable, but it is exactly the moment when you are most likely to agree too hastily to unfavourable terms.
Use that cooling-off period to have the offer reviewed by an employment lawyer. In many cases, the costs of legal assistance are reimbursed by the employer as part of the agreement being concluded.
How to challenge it, step by step
Do you want to challenge or increase the transition payment in your settlement agreement? These are the concrete steps:
- Calculate the statutory transition payment yourself, based on your exact length of service and gross monthly salary including holiday pay and allowances.
- Compare your calculation with the offer in the settlement agreement and establish what the difference is.
- Consult an employment lawyer before responding to your employer — a professional response carries more weight than an emotional rebuttal.
- Have the lawyer formulate a counter-proposal, preferably with a substantiated calculation and any arguments based on the reason for dismissal or the absence of a sound dismissal file.
- If you have not yet signed, do not sign under pressure. Always have the agreement checked first.
- If you have already signed, withdraw in writing within two weeks of signing and seek legal advice immediately.
Why Arbeidsjurist Eindhoven
At Arbeidsjurist Eindhoven we know the local labour market and understand exactly how negotiations over a settlement agreement work in practice. We assess your settlement agreement calmly and thoroughly: is the calculation correct, are you missing allowances or holiday pay, and is there room for a higher payment? We support you throughout the entire process, from an initial review to targeted negotiations with your employer.
Do you live or work in Eindhoven or the Brabant region and have you received a settlement agreement that doesn’t seem right? Contact us without obligation. We would be happy to explore the possibilities with you.
Frequently asked questions
Am I entitled to the statutory transition payment in a settlement agreement?
Strictly speaking, you have no statutory right to a transition payment in a settlement agreement, unlike dismissal via the UWV or the subdistrict court. In practice, almost every employer offers a transition payment nonetheless, because otherwise you have no obligation to cooperate with the settlement agreement. That gives you a strong negotiating position.
How do I know whether the transition payment in my settlement agreement has been calculated correctly?
Calculate the amount yourself based on your exact years of service, gross monthly salary including holiday pay (8%), fixed allowances, and any year-end bonus. Compare that with the offer in the agreement. If it doesn't add up, or you're not certain, have the calculation checked by an employment lawyer before you sign.
Can I also negotiate more than the statutory transition payment in a settlement agreement?
Yes, in a settlement agreement the statutory transition payment is the starting point, not the end point. Depending on the strength of your employer's dismissal file, the reason for dismissal, and the length of your service, there may be room for a higher payment. In negotiations, the higher pre-2020 calculation method is sometimes used as well.
What should I do if I have already signed a settlement agreement with a payment that is too low?
You have a statutory two-week period in which to withdraw from a signed settlement agreement, without needing to give a reason. Do this in writing and immediately engage an employment lawyer to assess what your options are going forward.
Does my employer pay the costs of an employment lawyer for reviewing the settlement agreement?
In many cases, the legal costs of having a settlement agreement reviewed or negotiated are reimbursed by the employer as part of the arrangements being agreed. This is a point that can be expressly included in the settlement agreement. Always discuss this with your employment lawyer before you sign.
We are happy to think along with you. For advice tailored to your situation we would gladly sit down with you. No rights can be derived from the content of this page and it may contain inaccuracies.
