The Amsterdam Court of Appeal recently issued a remarkable judgment. Four former employees of a bar claimed payment of, among other things, a great deal of overtime from their employer. The employees only made their claim known several months after their employment contract had ended. What can an employer do when faced with such a claim after the fact, which it had not taken into account?

The limitation period for this type of claim is five years after the claim fell due (Article 3:308 of the Dutch Civil Code). The claim had not yet expired in this case.

Reliance on forfeiture of rights is always an option for the employer in this kind of situation, but that defence would have been of no avail to the bar owner in question. Forfeiture of rights has no direct legal basis. It derives from the restrictive effect of reasonableness and fairness (Article 6:248(2) of the Dutch Civil Code). Prevailing case law provides that rights are forfeited only in special circumstances. Mere inaction on the part of the former employees does not suffice to assume forfeiture of rights (Dutch Supreme Court, 29 November 1996, NJ 1997/153).

However, the bar owner successfully relied on the “obligation to complain” before the Amsterdam Court of Appeal. That obligation is set out in Article 6:89 of the Dutch Civil Code and provides that a creditor may no longer rely on a defect in the performance if a complainant has not protested to the other party within a reasonable time after he or she discovered or should reasonably have discovered the defect. Successful reliance on Article 6:89 of the Dutch Civil Code means that the performance can no longer be enforced in respect of the defect at issue. A defence based on the obligation to complain is rarely successful if it is directed against an employee. In employment law, the relationship between the employee and the employer is deemed to be unequal by definition. That inequality must be monitored and compensated for if necessary. It is not always easy for an employee to complain, because of his or her subordinate position. In legal literature and case law there is therefore by no means a consistent trend when it comes to the application of the obligation to complain in employment law. No Supreme Court employment law judgment has been passed to date.

The Amsterdam Court of Appeal keeps a close eye on the compensation for inequality in labour relations and on the protection of employees underlying the mandatory nature of Title 10, Book 7, of the Dutch Civil Code. Despite this reticence, the bar owner’s reliance on breach of the obligation to complain was successful. As stated above, the former employees’ claim related to the payment of a great deal of overtime. The employees were aware of their entitlement to the payment/compensation for that overtime; it was expressly stated in the pay slip. According to the Court of Appeal, in light of the background described above, the former employees should have complained about the lack of payment in time, i.e. from the moment they could see in their payslips that not all the overtime worked had been paid. The Court of Appeal also considers it relevant in this regard that the collective bargaining agreement provides that overtime should, in principle, be compensated in the form of time off, and that payment is made only if compensation in time off is impossible.

According to the Court of Appeal, the rationale of the obligation to complain, i.e. protection against claims that the debtor need no longer take into account, means that the bar owner cannot be confronted with a claim for payment of overtime at such a late stage that he is no longer able to compensate for those hours in time off or to organise the work differently.

The Court of Appeal’s ruling therefore provides employers who are confronted with outdated receipts from employees or former employees with a potentially successful defence.

Any questions about this subject? Please contact Michiel van Haelst (+316 553 944 87). 

This article was published in the Newsletter Vestius of June 2022

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