"My employees are busy making holiday plans for next summer at the moment. Soon the holiday forms will start trickling in again. My company doesn't have a summer holiday closure period. It's important that we remain available for our customers during the summer period as well. So the employees can't all go on holiday at once. What exactly are the rules about establishing holiday dates? Can I just refuse an employee's request to take holiday? Does our system that an employee must have an approval signature on his holiday form before he has permission comply with the law?"
The manner in which the employer and employee should establish, by proper consultation, when holiday will be taken is set out in Art. 7:638 of the Dutch Civil Code. The principle on which the legislation is based is that the employer will determine the dates on which the holiday starts and finishes "in accordance with the employee's wishes". The employer may refuse the employee's holiday application if "significant reasons oppose the grant of the application". The wishes of the employee making the application therefore take priority. It is the employer who must show "significant reasons" to prevent the holiday being taken at the proposed time.
This raises the question of what constitutes a sufficiently significant reason. During the explanation to parliament at the time when this provision of the Civil Code was created, the legislator lifted the edge of the veil: the grant of a request for holiday may not result in "serious" disruption to the operation of the business. "The consequences of the disruption to the operation of the business must always be evaluated in relation to the consequences that refusing the request for holiday will have for the employee. The kind of situation where this would apply is, for example, where employees in a seasonal company wish to take holiday during peak season or where, in a small company, the company would have to be closed because no replacement is available." There are few court decisions available concerning situations that have led to discussion on this issue.
To return to your question, it seems likely that you can refuse permission for your employees to take holiday on the grounds that you want to remain open during the summer holidays. To strengthen your position, we would recommend that you mention this special, annually recurring aspect of the way your business operates to candidates during interviews. You do need to be careful that you don't systematically deprive the same employees every year. You also need to avoid systematically refusing employees' requests to take holiday. Over time, such systematic refusals can become implausible as in reality they result in employees being forced to carry holiday forward.
Refuse requests in writing
The way in which the employer becomes bound by the employee's suggested holiday dates is a potential legal pitfall for the employer. This is because simply by failing to respond the employer is bound by the holiday application submitted by the employee. This is laid down in the legislation: "If the employer has not, within two weeks of the employee making his wishes known in writing, given the employee significant reasons in writing, the holiday dates are determined in accordance with the employee's wishes."
In other words, from a legal perspective the employer's express consent, for example by signing to show that the proposal is agreed, is not required. This means that the employer who leaves a holiday application on his desk for two weeks faces a fait accompli. In strict legal terms, an oral refusal is also insufficient. You are formally required to refuse the holiday application in writing.
Agreeing different rules
This statutory system only applies if you have not agreed different rules within your company. You are permitted to vary the statutory rules "by written agreement or under a collective employment agreement". So if you don't want to be bound by your employees' holiday applications so easily, we recommend that you incorporate this into the written employment contract signed by both parties when an employee joins the company. Alternatively you can incorporate into your employer's terms and conditions holiday regulations for the company that differ from the statutory rules described. It will then be necessary to include in the employment agreement signed by each employee a declaration that the contents of the employer's terms and conditions apply. It's also possible that a collective employment agreement incorporating different holiday rules applies to your company.
The ultimate sanction for failing to comply with agreed terms is to dismiss the employee (either summarily or otherwise). No doubt you will also be tempted to take this route in the situation where the employee has gone on holiday anyway despite your having withheld permission. You should exercise caution with dismissals on these grounds. The validity of such a dismissal will depend, among other things, on the importance that taking the holiday had for the employee, the number of holiday days accrued, the way in which he made the application and whether you rejected his application in accordance with the statutory rules described or your company's regulations, but also on how your employee has been performing in other areas. The court will decide whether a dismissal is valid in accordance with the applicable rules for dismissal. In doing so, the court will weigh up the importance to the employee of the employment continuing as against the importance of terminating the employment for you. The extent to which your employee's actions have caused irretrievable breakdown of the employment relationship may be a factor in this.
- Check whether a collective employment agreement incorporating holiday regulations applies to your company;
- If no holiday regulations apply under a collective employment agreement, draw up internal holiday regulations for your company;
- Vary the statutory rules by incorporating an explicit rule that your written permission is required in order to take holiday;
- If there are no internal holiday regulations or collective employment agreement holiday regulations: inform the applicant of any holiday application refusal in writing and giving reasons within two weeks of the application;
- Inform job applicants if there is a requirement to work during specified peak periods;
- Avoid a situation where your refusal results in employees being forced to save up holiday days;
- Regardless of these precautions, exercise caution in dismissing employees who take holiday without your permission.