| 1.
Agreements for the performance of labour
With
regard to agreements for the performance of work against compensation,
the Civil Code explicitly states three sorts of agreements. These
are:
1. the agreement of contracted work;
2. the agreement for the performance of fixed service;
3. the working agreement.
Contracted work
The
contract for work is an agreement whereby one party, the contractor,
commits himself towards the other party, the contractee, to execute
a fixed work of material nature for a specified price determined
by the contractee; in this case one has a specific result in mind.
Agreement for performance of fixed services (services rendered)
In
practice agreements for the performance of fixed services can fall
under several categories (rest group).
It
generally concerns the relation between a professional (e.g. lawyer,
notary, accountant, guide, etc.) and his client. Plus all other
sorts of agreements where there is work conducted but there is no
work agreement (the authority element is absent), e.g. gardening,
car-wash, etc.
The working agreement
The
working agreement is an agreement whereby one party, the employee,
commits himself to perform work in the employ of the other party,
the employer, against wages during a fixed period of time.
If
a person has worked for someone else for remuneration during three
consecutive months for at least eight hours per week or at least
35 hours per month, it is assumed that a working agreement exists,
unless the employer can prove otherwise.
This
folder only deals with the working agreement.
2.
When does an agreement qualify as a working agreement?
A working
agreement should have the following elements in order to qualify
as a working agreement:
A. Wages
B. Work
C.
Authority (supervision) element (in the employ of)
Ad
A. Wages are the agreed upon exchange of the employer for
the work done by the employee.
Money
(fixed amount, provision, share in the profit), food, work-clothes,
production and use of housing can be elements of wages. The employer
must take into account the provisions of the Minimum Wages Ordinance
.
Ad
B. The employee must perform the work; the work must be
of value and must be performed by the employee himself; meaning
no third party is allowed to perform the work.
Ad
C. The employee is in the employ of the employer; the employer
is authorized to execute authority; the employer is authorized to
give orders (binding indications/ instructions); the employer is
authorized to supervise the work.
The
factual situation is decisive; not how parties call their relation
towards each other.
3.
The form / content
The working agreement is form free, meaning that it can
be concluded both verbally as in writing. However, for a number
of provisions the written form is prescribed. The written form has
preference over the verbal one with regard to the evidence possibilities;
the costs are for the employers account.
In
general the parties involved, when concluding a working agreement,
will have to make arrangements concerning the duration, the nature
of the work to be conducted, the position to be held, the salary,
vacation, certain allowances, etc.
4.
Trial period
The
parties involved can agree upon that the first two months (maximum)
will be considered a trial period. During this trial period both
parties have the right to terminate the agreement immediately without
giving a reason. A trial period can be agreed upon only in writing.
A trial period of more than two months is void.
5.
Duration
The
service can be entered into for a fixed (e.g. one week, six months,
one year, for the duration of the work, as long as the replaced
employee is sick) or for a non-fixed period of time (the so-called
“permanent service”).
Since
the coming into force of the Ordinance Flexibilization of the Labour
legislation (August 1, 2000) it is no longer possible to extend
labour agreements for a fixed time period indefinitively. Notice
is no longer required for the termination (not in between) of an
extended temporary labour agreement, so the extended temporary agreement
(up and till the third temporary agreement) also ends automatically.
However,
after a series of four extended labour agreements, following each
other within three months, the fourth contract automatically becomes
an agreement for an indefinite period (“permanent service’).
The same applies if less than four fixed time agreements follow
each other at less than three months intervals and these labour
agreements combined (including the interruptions) exceed a 36 months
period.
A labour
agreement for a fixed period can only be terminated before it’s
ending date if both parties have agreed thereupon in writing.
The
difference between a fixed and a non-fixed period of time is of
importance, on the one hand for the way the service is terminated
and on the other hand, for the prolongation of it. (see folders
employee and dismissal and employer and dismissal).
6. Reward
The
employer has the obligation to pay the employee at least the hourly
minimum wage.
Per
August 1, 2001 the system of minimum wages was adapted in such a
way that from this date only hourly minimum wages are applicable.
For current minimumwages see folder 4: minimum wages.
In
the new system minimum weekly wages are determined by multiplying
the number of hours worked per week by the minimum hourly wage.
Monthly wages are calculated by multiplying the hourly minimum wage
first by the number of hours worked per week and then by 4.33 (see
also the folder on minimum wages).
7.
Payment which is due
Wages
fixed according to space of time (for example hourly-, weekly-,
fortnightly-, monthly wage) are payable from the point of time when
the employee entered service until the time of termination of the
service relationship.
In
principle the employer does not have to pay the employee his wages
owed for the time during which the employee has not performed the
stipulated work (no work no pay).
However,
the employee retains his right to wages in case of:
a.
Sickness or accident
If the
employee is unable to perform his work due to sickness or accident,
he will have to receive for a relatively short period (a couple
of weeks) his full salary. Only by written agreement (e.g. collective
labour agreement) one can deviate from this.
(Mind
you: those who fall under the Social Security Bank (SVB) (these
are persons who enjoy, as of 1-1-'02, a day's wages of max. fl.
144,55 for a 6-days workweek or a day's wages of max. fl. 173,46
for a 5-days workweek or a month's wages of fl. 3758,30) have a
right to sickness benefits for a maximum of 2 years.)
b.
Fulfillment of legal "duties"
If an
employee is not able to work due to the fulfillment of a by general
ordinance stipulated obligation, which could not be performed in
his free hours (e.g. casting his vote, notification at the registrar's
office), he will have to receive for a relatively short period,
to be calculated according to fairness (= a couple of hours) his
full salary.
c.
Special circumstances
If an
employee is unable to work due to special circumstances (e.g. the
confinement of his wife, the death and burial of one of his housemates
or his parents, grandparents, children, grandchildren, brothers
and sisters), he will have to receive for a relatively short period,
to be calculated according to fairness (= one of more days) his
full salary.
In
collective labour agreements these and other cases can be regulated
more precisely under the heading: short absenteeism or extraordinary
leave.
d.
Employer's absenteeism
If an
employee is willing to perform work, but the employer does not make
use of this, then the employee has to receive full payment of his
salary.
8.
Overtime
The
Labour Regulation 2000 distinguishes between scheduled workers and
non scheduled workers. A scheduled worker is an employee whose working
hours fall completely or partly outside the normal office (business)
hours.
It
is important to know whether an employee is a scheduled worker or
not because different rules concerning working hours, rest time,
overtime, etc. apply to both groups (see also the folder: flexibilization
of the labour legislation).
Overtime
can arise as a consequence of:
-
work during the rest time/period;
- work
that exceeds the maximum number of hours per day or per week.
Overtime compensation
The
compensation for overtime in case of:
Compensation (incl.regular wage)
Exceeding the maximum number of hours (per day or after four weeks)
150%
Overwork during breaks
150%
Overwork on half day that the employee is free according to his
work schedule
175%
Overwork
on day of rest
200%
Overwork on public holiday
250%
Overwork in combination with night duty (only for scheduled workers)
175%
Employer
and employee can agree in writing that overtime instead of being
compensated in money will be partly or wholly compensated in time
back, in proportion to the above mentioned compensation percentages.
For
hotels, restaurants and casino’s different rules apply. See
the folder: labour ordinance hotels, restaurants and casino’s.
Also
for household personnel separate rules apply. For this group see
the folder; flexibilization of the labour legislation.
9.
Vacation
In the Ordinance Vacation Regulation the minimum number
of days of vacation per year is stated: three times the number of
workdays stipulated per week.
So
if somebody works 4 days a week, he or she is entitled to a minimum
of 4 x 3 = 12 paid days of vacation. However, if an employee works
six days per week, he/she does not need to have more then 15 days
of vacation, but more is allowed.
During
the vacation the wages must be paid. Half of the vacation should
be given jointly. Payment of the days of vacations, that have not
been taken, is only allowed at the end of the working agreement.
(see the folder: vacation and public holidays).
10. Termination of the working agreement
The
working agreement can be terminated in the following ways:
a.
Mutual consent
Under
certain conditions parties can agree on termination with mutual
consent of the working agreement.
b.
Death of the employee
The
working agreement between an employer and an employee will terminate
due to the death of the employee. However, the death of the employer
does not terminate the working agreement.
c.
When the time has elapsed
The
working agreement with a fixed period of time terminates, insofar
nothing else has been agreed upon, automatically when the time agreed
upon has lapsed. This means that prior notice of termination is
not needed, unless agreed upon. If the working agreement with a
fixed period of time is prolonged tacitly or explicitly, prior notice
of termination is not needed, this means that the prolonged (up
and till the third) temporary working agreement terminates automatically.
d.
Dissolution of the working agreement by court
The
service can also be terminated because a judge has, at the request
of one of the parties concerned, dissolved the working agreement
on grounds of grave (important) reasons. The petitioner usually
has to pay an indemnification to the other party.
e.
Termination during the trial period
During
the trial period the agreement can be terminated at any time, without
being liable for damages.
f.
Dismissal "on the spot"
Both
the employer and the employee can terminate the service with immediate
effect due to an urgent reason. The dismissal has to be "on
the spot" (taking effect immediately) and the party concerned
has to be notified immediately of the urgent reason.
g.
Notification
The
working agreement can be terminated by notification.
One
has to take into account the day of notification and the terms for
notification. The day of the notification (the day the agreement
is terminated) is the day on which the working agreement ends as
a consequence of notification (so this is not the day notification
takes place). Nowadays notice can be given at any day unless parties
have agreed differently in writing. The period of notice starts
from the day notice has been given. So if the notice period is one
month and notice is given on e.g. March 20, than the labour agreement
has ended on April 21.
The
period of notice the employer has to take into consideration depends
on he duration of the employment:
a.
if the employment lasted less than five years: one month;
b.
if the employment lasted more than five years, less than ten years:
two months;
c.
if the employment lasted more than ten years, less than fifteen
years: three months;
d.
if the employment lasted more than 15 years: four months.
The
period of notice for the employer may only be shortened through
a collective labour agreement (CLA). The period of notice can be
extended through a written agreement.
The
period of notice for the employee (whether paid monthly, weekly
or biweekly) is one month. This period can be shortened of extended
through a written agreement. The notice period for the employee
cannot be extended to more than six months.
As
of September 16, 2000 on the island of Curaçao prior permit
is necessary only for individual dismissals in the following industries:
-
business services, excluding real estate activities and computer
and related activities;
- education,
excluding international commercial educational institutions;
- health
and social work;
-
other social and personal services;
-
extra territorial bodies and organizations.
On
the other islands employers in all industries still need a dismissal
permit for terminating employment.
11. The severance pay scheme
An
employee who has not caused the termination of his working agreement,
is entitled to severance pay. The severance pay is an one-time payment
calculated on the basis of the number of years of employment.
The
severance pay scheme is as follows:
- for
the first till the tenth year in service one week's wages per
year of employment;
- for
the eleventh till the twentieth full years in service one and
a quart times the week's wages per year;
-
for the following years twice the week's wages per year
(see
the folder: severance pay after dismissal)
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