Parties’ intentions no longer relevant to classification question

The classification question, the question whether a working relationship should be regarded as an employment contract, plays an important role on the changing labour market. The Amsterdam Court, for instance, ruled in 2019 that (all) the Deliveroo deliverers were in fact employees. And trade union FNV sued Uber because its drivers are hired as self-employed persons rather than as employees (and wrongly so, according to the FNV).

It is not always easy for a judge to assess whether or not an employment contract exists. A recent Supreme Court judgment (X/Municipality of Amsterdam) provides a tool in legal practice. According to the Supreme Court, it is not or no longer relevant in answering the question whether or not a person is an employee whether the parties intended to enter into an employment contract. Instead, the court must assess on the basis of the rights and obligations on which the parties agreed whether an employment contract exists; and subsequently whether the agreement between the parties also meets the requirements of an employment contract, such as individual labour, wages and an employer-employee relationship.

The recent X/Municipality of Amsterdam judgment is regarded as a significant change compared with the 1997 Groen/Schoevers judgment. That judgment, as well as later Supreme Court judgments, led to the conclusion that the parties’ intentions were relevant in answering the question whether an employment contract existed. In many contracts for services the provision was therefore included that the parties expressly did not intend to enter into an employment contract. The Supreme Court has now clarified that the written confirmation of the parties’ intentions is no longer relevant. The question how the parties de facto implement the contract is therefore decisive, rather than the written agreements made. Although it cannot be said with any certainty beforehand what effect this judgment will have in practice, it is entirely possible that lower courts will sooner be inclined to classify a legal relationship as an employment contract.

For more information on this subject please contact Bart de Vroe (+31-6-20366243) or Anna Görgün (+31-6-23908453).

This article was published in the Newsletter Vestius of December 2020