Many employees with a temporary contract think that they are not entitled to redundancy pay when their contract ends prematurely. However, even in that case, there may be a right to the transition allowance – and sometimes even more, especially if a settlement agreement (VSO) is concluded.
This article explains how the rules work with temporary contracts, explains your rights, and what to look out for in a VSO.
Do you have a right to a transition allowance with a temporary contract?
Yes, employees with a temporary contract are also entitled to the transition fee when their employment contract:
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is not extended by the employer, or
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ends prematurely via a VSO or dismissal procedure.
The transition payment applies even if your contract has been short-lived: from 1 day of employment a (pro rata) payment is due.
How much is the transition fee for a temporary contract?
The allowance amounts to:
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1/3 gross monthly salary per working year.
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For shorter periods, this is calculated pro rata.
👉 Example: An employee with a salary of € 2,400 and a 6-month contract is entitled to approximately € 400 transition fee for premature termination.
Settlement Agreement for Temporary Contracts
When a temporary contract is terminated earlier, the employer can offer a VSO. This often happens:
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In case of poor performance or a disrupted relationship.
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If a departure is needed earlier than the expiration date.
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When parties want to part “in mutual agreement”.
Points of Attention with a VSO with Temporary Contract:
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Notice Period – check that the legal period is applied correctly.
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WW Rights – the reason for dismissal must be neutral (“in mutual agreement”).
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Transition Fee – temporary employees are also entitled to this.
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Extra Compensation – if the employer wishes to terminate the contract prematurely, you can ask for more than just the transition payment.
Practical Examples
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Example 1: An employee with a 1-year contract was offered a VSO after 8 months. In addition to the transition payment, he received 2 extra monthly salaries to agree.
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Example 2: A call worker with a 6-month contract didn’t think they were entitled to compensation. Through a lawyer, she still got the transition payment.
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Example 3: An employee signed a VSO without notice period. As a result, he had to wait for his WW for 1 month longer.
Checklist: VSO with Temporary Contract
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📑 Check if your transition payment is calculated correctly.
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📅 Pay attention to the correct notice period.
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📝 Ensure that the reason for dismissal is neutral.
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💶 Negotiate for extra compensation if the employer wants to terminate sooner.
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⚖️ Have your VSO checked by a labor lawyer.
Common Mistakes
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Thinking temporary contracts don’t entitle you to transition payments.
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Agreeing too quickly without asking for extra compensation.
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Forgetting that call employees and short employments also count.
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Losing WW rights due to incorrect dismissal reason in the VSO.
Frequently Asked Questions (FAQ)
1. Do I have a right to a transition fee with a temporary contract?
Yes, even if it is not extended or terminated prematurely.
2. How is the payment calculated?
1/3 monthly salary per working year, pro rata for shorter periods.
3. What if my contract simply expires?
Then you are also entitled to a transition payment, unless you resign yourself.
4. Can I get more than the transition payment?
Yes, especially with a VSO, because the employer often wants to get rid of you faster.
5. Should the employer pay my attorney fees?
Yes, this is common and should be included in the VSO.
Why Arslan Lawyers?
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Specialized in dismissal and settlement agreements
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Also guide employees with temporary contracts
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Negotiate for extra compensation and safe WW rights
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Often recover costs from the employer
Conclusion
Even with a temporary contract, you have a right to a transition allowance. In case of premature termination through a VSO, you can often negotiate more. Always have your agreement checked, so you don’t miss out on money or rights.
