Legal insight

D. CASAER, “Significant fines for disregarding the dismissal prohibition in the event of transfer of undertaking”, ODC HR Law Newsletter, April 2015 (English version)

A Brussels hotel decided to outsource its house keeping department and the provision of breakfast.

An employee who worked as chamber maid just before the external company would take over, was proposed to end the employment agreement by mutual consent, which she agreed to. The employee then started to work at another company, which 6 weeks later took over the maintenance contract at the hotel from the first external company. The external company argued that there was no transfer of undertaking, because no personnel was transferred.

 

Significant fines for disregarding the dismissal prohibition when transferring a company

A Brussels hotel decided to outsource its house keeping department and the provision of breakfast.

An employee who worked as chamber maid just before the external company would take over, was proposed to end the employment agreement by mutual consent, which she agreed to. The employee then started to work at another company, which 6 weeks later took over the maintenance contract at the hotel from the first external company. The external company argued that there was no transfer of undertaking, because no personnel was transferred.

Based on a decision given by the European Supreme Court, the Brussels Labour Court disagreed and in addition, the employee was granted damages equal to 6 months of wages due to the failure to respect the dismissal prohibition applying in the event of transfer of undertaking, and due to the employer’s unfair treatment of the employee, who was induced to sign a termination by mutual consent under false pretexts. 

This compensation can be considered quite significant by Belgian standards; after all, usually only symbolic amounts (€1,000) are granted. However, in this case the Labour Court made a clear statement.

(Labour Court Brussels, 19 June 2014, Ruling 2011/AB/68, unpublished)