If you have been off sick for some time and your employer proposes a settlement agreement, it is entirely reasonable to wonder what this means for your WIA benefit. Signing such an agreement can affect the amount and continuity of your benefit, particularly if the timing is wrong. Below you can read what to look out for.
What is the WIA and when are you entitled to it?
The Work and Income according to Labour Capacity Act (WIA) is intended for employees who, after two years of sickness, are still unable to work fully. The UWV then assesses how much you are still able to earn compared to your previous salary. On that basis, you fall under either the IVA (fully and permanently incapacitated for work) or the WGA (partially or temporarily incapacitated for work).
It is important to understand that your WIA application and your employment contract are two separate processes. Nevertheless, they intersect at the moment a settlement agreement is placed on the table.
When does the settlement agreement play a role in the WIA?
A settlement agreement may be offered during or shortly after the two-year period of sickness. Sometimes an employer does this just before the WIA assessment takes place, sometimes only afterwards. The moment at which you sign makes a significant difference.
If you sign before the WIA assessment, you risk missing the application procedure or creating uncertainty about the obligation to continue paying your salary during the remaining period. If you sign after the WIA has been granted, the consequences for the benefit itself are generally more limited, but there are still points to be aware of.
What changes to your WIA benefit when a settlement agreement is signed?
Your WIA benefit is linked to your incapacity for work, not to your employment contract. In principle, the benefit continues even after you and your employer part ways via a settlement agreement. However, there are situations in which the benefit may be put at risk:
- Incorrect end date: if the official end date of the employment contract does not align with the WIA decision, gaps in your income may arise.
- Incorrect wording in the settlement agreement: if the agreement contains anything suggesting that you resigned of your own accord or that illness played no role, this may affect the UWV’s assessment.
- Provisions regarding additional earnings or reintegration: if the settlement agreement contains clauses about work you will be carrying out, this may affect your percentage of incapacity for work.
- Failure to account for the reassessment period: the WIA is periodically reassessed; provisions in the settlement agreement must not cut across this process.
Pay close attention to the content of the settlement agreement
Not all settlement agreements are the same. The standard texts provided by employers are almost always drafted in the employer’s favour. This means you must review the text critically before signing.
Arrange a no-obligation chat and discover how we can help you.
Plan a conversationA few things to check specifically:
- Does the stated reason for termination accurately reflect the actual situation?
- Is a correct redundancy payment included, even if you are already receiving WIA?
- Are there provisions for an additional payment on top of the statutory redundancy payment?
- Does the settlement agreement contain a full and final settlement clause that also excludes future claims?
- Has the end date been carefully aligned with the WIA decision?
More general information about your rights concerning a settlement agreement during sickness can be found on the page Settlement agreement during sickness: everything you need to know.
Redundancy payment and WIA: are you entitled to one?
Yes, even if you are receiving a WIA benefit, you are in principle entitled to a redundancy payment upon dismissal via a settlement agreement. The amount depends on your years of service and your salary. Employers sometimes try to circumvent this by arguing that the WIA benefit already provides sufficient compensation. This is not correct in law. Do not be misled and always check that the payment has been calculated correctly.
What can you do yourself?
There are a few concrete steps you can take if you are offered a settlement agreement whilst receiving or expecting a WIA benefit:
- Always request time to reflect; you have a statutory right to fourteen days in which to withdraw your signature.
- Have the text reviewed by an employment law specialist before you sign.
- Ask the UWV or an expert to explain what the termination means for your specific benefit situation.
- Negotiate the terms; a first proposal is rarely the final offer.
Why Labour Lawyer Eindhoven
At Arbeidsjurist Eindhoven, we understand that a settlement agreement combined with a WIA process raises many questions. We help you make sense of the text, map out the consequences for your benefit, and negotiate better terms. That way, you do not have to face your employer alone.
Would you like to know where you stand? Please feel free to contact us with no obligation. We are happy to think things through with you.
Frequently asked questions
Will I lose my WIA benefit if I sign a settlement agreement?
In most cases, no, because the WIA is linked to your incapacity for work and not to your employment contract. However, certain provisions in the settlement agreement or incorrect timing may have indirect consequences. Always have the agreement checked.
Am I entitled to a redundancy payment if I am already receiving WIA?
Yes, even with a WIA benefit you are in principle entitled to a redundancy payment upon dismissal via a settlement agreement. The amount is calculated on the basis of your years of service and salary. Check that this has been correctly included in the agreement.
What is the best time to sign a settlement agreement in relation to the WIA assessment?
Generally speaking, it is wiser to wait until after the WIA decision, so that you know where you stand. If you sign beforehand, you risk gaps in your income or complications in the application procedure. Always seek advice about your specific situation.
We're happy to help you brainstorm ideas. For advice tailored to your specific situation, we'd be happy to sit down with you. No rights can be derived from the content of this page and it may contain inaccuracies.
