Settlement Agreement: check these terms (2026)

Your employer imposes a settlement agreement on your desk. Often, you are given only a few days to sign the document. Otherwise, the proposal is off the table, your employer tells you. But a VSO is not a standard document you just sign. It is a legally binding agreement that guarantees your income, your WW benefit and directly affects your future on the job market.

Some conditions are required by law, other conditions are sometimes deliberately not included and other conditions only work in the employer's favour. In this article, you will read exactly which conditions a VSO must contain, which clauses it regularly lacks and what you can do if the agreement is wrong.

Do you still go about checking your VSO yourself? Then, first of all, it is important to put everything in writing. This is because a VSO is legally valid only if the agreement is in writing and signed by both parties.

A verbal agreement has no legal force whatsoever. So indicating that your employer has agreed to pay you a termination payment does not make much sense in court. If you do unexpectedly disagree on the terms of the dismissal.

This is the most decisive clause for your entitlement to unemployment benefits. The VSO must explicitly state that it is the employer who initiates the termination of employment.

Formulations such as "The parties have mutually agreed" without further explanation are insufficient. The Indeed, UWV assesses the factual circumstances and looks critically at who initiated the termination. If it is not clear that your employer initiated it, it may be grounds for the UWV to assume that you are resigned yourself. And thus not entitled to unemployment benefits.

Always use a neutral ground for dismissal, such as:

• Economic conditions or reorganisation
• A difference of opinion on job filling
• A permanently disturbed working relationship, where no blame attaches to the employee

Depending on the reason for dismissal it is important to include this reason properly and unambiguously in the settlement agreement.

The end date in the VSO must correspond to the statutory or contractual notice period. The UWV applies a notional notice period: if the actual end date is earlier than the date the notice period expires, your unemployment benefit will only start after that fictitious date. This could mean a period of weeks or even months without income.

This error in the condition in a settlement agreement is common in long-term employment contracts, where the statutory notice period has been extended from when the employment contract was signed.

Does your employment contract have no interim notice clause? Then you risk the UWV awarding WW only on the original contract end date. Even if you quit months earlier. The VSO itself can still include an interim notice clause to avoid this.

By virtue of Section 7:670b of the Civil Code you always have 14 calendar days after signing to revoke the VSO without giving reasons. In legal practice, this is also called a mandatory law provision. A clause that restricts or conditions this period is legally void.

Does the reflection period not in the VSO? Then automatically extend it to 21 days. Always revoke in writing: by registered letter as well as by e-mail. Keep the proof of receipt.

With a VSO, there is technically no automatic right to the statutory transitional allowance. After all, it is a termination by mutual consent. In practice, everyone takes at least the statutory transitional compensation. In 2026, it amounts to:

• 1/3 gross monthly salary per full year of service

• Calculated pro rata over all years of service, including incomplete years

• Always keep in mind the legal maximum

Is there a lower fee in the VSO? Then you have a legal argument to demand more.

We come across it almost every day: important conditions not included in the settlement agreement. Why is it important not to miss these conditions? Because otherwise you will end up with a hassle with your employer at a later date. Or because you might later regret not having certain conditions included. We take you through the most important conditions.

Almost every VSO contains a final discharge clause. This clause excludes all future claims back and forth. But this also covers claims that you may not have recognised at the time of signing.

In practice, it is often about holiday pay, holiday hours, a bonus yet to be paid, outstanding overtime or other things you still have to demand from each other.

The exceptions we most often miss in settlement agreements are the following items. Therefore, check them carefully before signing:

• Has holiday pay been fully calculated and paid out?
• Are remaining holidays paid out or do you consider them taken?
• Is there any bonus or variable remuneration that has not yet been paid?
• Are there any outstanding expense claims?
• Does pension accrual continue correctly until the end date?

Always have these items explicitly excluded from the final discharge, or discount them entirely in the severance payment.

This does not seem so relevant to many people at signing. After all, many people are not yet engaged in their search for a new job when they face dismissal.

An existing non-competition or relation clause will simply remain in force after signing the VSO, unless the agreement explicitly lets it lapse or limits it. Employers regularly leave this out. Sometimes not by accident. It is one of the most negotiable clauses in the VSO, but only if you ask for it.

Check:

• Does the non-compete clause still apply, and for how long?
• What about the geographical scope. Is it nationwide?
• What are the consequences if you do join a competitor? Do you then owe a penalty?
• Does a non-solicitation clause restrict you from approaching customers? What about this, if any, with a new employer?

A bill which is currently going through the legislative mill in 2026, introduces far-reaching changes: the maximum duration of a non-compete clause is limited to one year, the employer is obliged to substantiate in writing the geographical scope and substantial business interests, AND if the employer invokes the clause, it must provide the employee with remuneration pay. Although the law is not yet in force, this already provides an argument in negotiations: ask for a time limit and compensation clause in the VSO.

Exemption from work during the notice period is common, but Not legally required It is not always included in the VSO. Does it not mention an exemption? Then you are obliged to continue working until the end date. Does it mention an exemption? Then pay attention to the associated conditions:

• Do remaining holiday days count as taken during the notice period?
• Are you allowed to do side work or already start at a new employer?
• What are the rules regarding accessibility and availability during a work exemption?

Employers are under Article 7:656 of the Dutch Civil Code You are obliged to provide a certificate upon request, but a positive certificate is not automatic. Therefore, always record in the VSO that the certificate is positively formulated and that the employer is willing to act as a good reference for future job applications. This may seem obvious, but many people forget it regularly.

Increasingly, parties in voluntary departure schemes (VSO's) are including a budget for outplacement or career coaching. This is not legally required but is certainly negotiable. We most often encounter it during reorganisations or with long-term employment contracts. For the employer, it's a relatively inexpensive concession; for you, it can be worth thousands of pounds and provide new opportunities to find employment elsewhere. Possibly even in a new sector. A complete overview of all the terms and conditions can be found below. We will discuss some of these terms and conditions later in this article.

At the time of signing Incapacity for workThen a statutory dismissal prohibition applies during illness. Signing a VSO is formally possible, but the UWV will most likely not grant a sickness benefit, because the employer during the first two years of illness You're obliged to pay wages. So you'll sign? Then the VSO must contain an explicit written statement that you have been informed of the consequences for your social security rights.

On 5 December 2025, the government submitted a bill limiting the UWV compensation scheme for transitional payments after two years of illness to small employers with a wage bill lower than around €1,082,500. Larger employers will soon no longer be entitled to this compensation.

This affects the room for manoeuvre: with larger employers, there is indirectly more pressure to ensure the termination goes smoothly, which can strengthen your position in negotiations.

Even with pregnancy, membership of the works council, or being a union representative, the following apply special prohibitions on termination.

A VSO in these cases is valid only with express and informed consent. In these situations, always engage a redundancy lawyer Read before you sign.

A VSO at a temporary contract Without an interim termination clause is a common pitfall. You agree to early termination, but the UWV will only grant unemployment benefits from the original contract end date. Always ensure that the VSO includes an interim termination clause or that the end date coincides with the contract date.

Employees who will reach their state pension age (AOW-leeftijd) within three years and are employed in a physically demanding occupation can make use of a new, structural RVU-scheme (Early Retirement Scheme) from 1 January 2026. The temporary scheme, which was broadly accessible, has been replaced by a scheme specifically aimed at employees with physically demanding work and health complaints.

The VSO plays a central role in this: agreements on the RVU allowance, waiving WW and severance pay must be correctly recorded in it. The tax-free limit is €2,357 gross per month (net equal to an AOW benefit). Anything above this leads to a pseudo-final levy of 52% for the employer and therefore affects agreements in the settlement agreement.

In addition to the mandatory conditions, many VSOs contain standard clauses that are not legally required but have significant practical consequences:

• Confidentiality clause You are not permitted to discuss the content of the VSO and often the dismissal circumstances with third parties. Check if this also applies to confidential company information that you already knew.

• Non-disparagement clause The parties shall not speak negatively of each other, either publicly or privately. Check whether the wording is reciprocal and symmetrical.

• Return of company property laptop, phone, company car, company pass. Check the exact return date and if there are any financial implications. Also, always ensure you get proof of return for company property.

• Reintegration obligations In case of illness, the VSO may contain agreements on the cessation of ongoing reintegration efforts.

• Stock options or bonus plans: What happens to unvested stock options after the expiry date? This is regularly missing from VSOs. Often from international employers.

Are there conditions that are relevant to you that are missing? That's no reason to refuse the VSO, but it is a reason to not directly drawable. Send a written request for the missing clauses to be added – employers are often open to this in practice, as they too benefit from a legally sound agreement. You have time for this: the reflection period only begins after signing.