The Supreme Court rules on the unilateral amendment of employment conditions by the employer

Background
In principle, an employer can unilaterally (i.e. without the employee’s consent) amend the terms and conditions of employment in two manners. First of all, an amendment can be made unilaterally if there are changed circumstances that require the amendment of the employment contract, provided at least that the employer has made a reasonable proposal to the employee to that effect. Secondly, an amendment can be made unilaterally by making use of the unilateral amendment clause, provided that this clause has been agreed in writing with the employee.

The second option - the unilateral amendment of terms and conditions of employment by means of an agreed unilateral amendment clause - was recently the subject of a ruling of the Supreme Court.

Uncertainty with regard to unilateral amendment clause
A ruling of the Supreme Court on this matter was desirable, as there was a debate in literature and case law on how a court should assess whether the employer can invoke the unilateral amendment clause.

It follows from the Dutch Civil Code that the employer may invoke a written unilateral amendment clause if: "he has such a compelling interest in making this amendment that the interest of the employee, that would be harmed as a result of the amendment, has to be set aside in accordance with standards of reasonableness and fairness[1]

However, it was unclear whether: (i) the employer should have an independent compelling interest in the amendment of an employment condition; or that (ii) the employer's interest should be weighed against the employee’s interest.

Judgment of the Supreme Court
The Supreme Court has recently ruled that the approach referred to under (ii) is correct and that a court, when applying the unilateral amendment clause, must assess whether or not:

"the interest of the employer in amending the employment condition, compared to the interest of the employee in maintaining the employment condition unchanged, is so important that the interest of the employee must, on grounds of reasonableness and fairness, be set aside for the interest of the employer." [2]

In other words, it amounts to a weighing of interests of both employer and employee.

Conclusion
It is advisable to always include a unilateral amendment clause in the employment contract. If such a clause has indeed been agreed with the employee, the employer may unilaterally amend an employment condition to the detriment of the employee if this is justified by sufficiently important interests of the employer. In this balancing of interests, the required weight of the employer's interests shall also be determined by comparing these to the weight of the employee's interests.


[1] Article 7:613 DCC.

[2] Supreme Court 29 November 2019, ECLI:NL:HR:2019:1869.

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