Right to Transition Payment: When are you entitled to it?

Are you facing dismissal and wondering whether you are entitled to a transition payment? In most cases the answer is yes, but clear conditions do apply. Below you can read exactly when the right to a transition payment arises, when it does not, and what you can do if your employer fails to pay.

The basic rule: dismissal on the employer's initiative

The core of the right to a transition payment is clear: the initiative to end the employment relationship must lie with your employer. If your employer dismisses you via the UWV or the subdistrict court, or does not renew your fixed-term contract, you are in principle entitled to this payment. That applies to both permanent and fixed-term contracts.

Since the introduction of the Wet arbeidsmarkt in balans (WAB) in 2020, you also accrue entitlement from your very first working day. You therefore no longer need to have completed a minimum period of employment before the right arises. Even if you are dismissed during your probationary period, you can claim the transition payment.

Fixed-term contract and on-call workers

Even if you work on a fixed-term contract, you are entitled to a transition payment if it is not renewed. The same applies if you work as an on-call worker: you also accrue entitlement from day one. The type of contract therefore makes no difference to the basic right.

Do note one exception: if your employer offers you a new temporary or equivalent contract before your current temporary contract expires, and you turn that offer down, your right to the transition payment lapses.

When are you not entitled to a transition payment

There are situations in which no right to a transition payment exists. Bear in mind the following circumstances:

• Jij neemt zelf ontslag – if you resign on your own initiative, you are in principle not entitled to the payment. An exception applies if your employer has acted in a seriously culpable manner and that conduct left you no choice but to take that step yourself.
• Dismissal due to your own seriously culpable conduct – if the dismissal is directly attributable to your own seriously culpable act or omission, the court may rule that you have no entitlement.
• Under 18 years old and working few hours – if you are under 18 and work an average of no more than 12 hours per week, the entitlement does not apply.
• State pension age reached – if the employment ends on or after the date on which you reach the state pension age (AOW age), you are not entitled to the payment.
• Employer's bankruptcy – in the event of the employer's bankruptcy, suspension of payments, or debt restructuring, the entitlement does not formally exist in the same way; consult a lawyer in such cases.
• Collective agreement replacement provision – some collective labour agreements include a substitute arrangement. From 2026, this will only be permitted in the case of dismissal for business-economic reasons.

Resigning yourself due to the employer's misconduct

If you resign because your employer has acted in a seriously culpable manner, you may still be able to claim the transition payment. Think of situations such as persistent non-payment of salary, serious breach of reintegration obligations, or gross intimidation. In such cases, the subdistrict court may also award an additional fair compensation on top of the transition payment.

How much is the transition payment in 2026

De hoogte van de transition payment depends on two factors: the length of your employment and your gross monthly salary. The calculation is straightforward: you receive one third of a monthly salary for each full year worked. For any remaining months and days, proportionate pro-rata calculations apply.

The statutory maximum in 2026 is €102,000 gross. If you earn more than €102,000 per year, one gross annual salary applies as the maximum. For comparison: in 2025 the maximum was still €98,000. This amount is indexed every year on the basis of the average contractual wage growth.

Bear in mind that fixed allowances, holiday pay and, under certain conditions, bonuses may also be included when calculating the monthly salary. Years of service accrued with a successor employer count in most cases towards the calculation as well.

What if your employer does not pay

Your employer is required to pay the transition payment no later than one month after the end of the employment. If payment is not made, statutory interest begins to accrue. If you have received nothing within three months of the end of your employment, you can apply to the court to enforce payment. Do not wait too long, as the limitation period is strict.

Practical tips when claiming your transition payment

• Always check whether the dismissal genuinely took place at the employer's initiative; the wording in letters and the settlement agreement is crucial in this regard.
• Keep all correspondence, the dismissal decision and contracts in a safe place.
• Have the calculation of the payment checked: the amount depends on your full years of service, including any previous consecutive contracts.
• Check whether allowances, a 13th month or bonuses have been included in the calculated monthly salary.
• If you are in any doubt about your situation, seek legal advice promptly — particularly if a settlement agreement is also involved.
• Submit your claim before the three-month limitation period following the end of your employment expires.

Why Employment Lawyer Eindhoven

At Arbeidsjurist Eindhoven we know employment law inside and out. Whether you have just received a dismissal letter or have been wondering for some time whether your transition payment is correct: we will look at your situation straight away and give you a clear picture of your legal position. No complicated legal jargon, but plain language and a personal approach — as you would expect in Brabant.

Would you like to know whether you are entitled to the transition payment and whether the calculated amount is correct? Feel free to contact us. We are happy to help.

Frequently asked questions

Am I entitled to a transition payment if my fixed-term contract is not renewed?

Yes. If your employer does not renew your temporary contract, you are in principle entitled to the transition payment. This also applies if you have only been employed for a short time, as you accrue entitlement from your very first working day. An exception applies if your employer makes you a new equivalent offer before the contract expires and you decline it.

Am I also entitled to a transition payment if I am ill at the time of dismissal?

Yes. Illness does not affect your entitlement to the transition payment. Even if you are (long-term) ill or have been ill in the period leading up to your dismissal, you retain your entitlement to the payment in principle. The calculation is based on your full gross monthly salary, not on the continued sick pay you received.

What is the maximum transition payment in 2026?

The maximum transition payment in 2026 is €102,000 gross. If you earn more than €102,000 per year, one gross annual salary applies as the maximum. This amount is indexed every year on the basis of average wage growth.

Am I entitled to a transition payment if I resign myself?

In principle, no. If you resign yourself, no entitlement to a transition payment arises. There is one important exception: if your employer has acted in a seriously culpable manner and this left you with no choice but to resign, you may still be able to claim the payment. In that case, have your situation assessed by an employment lawyer.

Within what period must my employer pay the transition payment?

Your employer must pay the transition payment no later than one month after the end of the employment. If they fail to do so, statutory interest accrues. If you have still received nothing after three months, you can go to court to enforce payment. Do not wait too long due to the applicable limitation period.

We are happy to think along with you. For advice tailored to your situation, we would be glad to talk. No rights can be derived from the content of this page and it may contain inaccuracies.