Excess Holidays May not be Offset against Wages

Excess Holidays May not be Offset against Wages
Date: 16-09-2023
Year of publication en number of publication: 2023 / 518
Reference: Sub-district Court of Haarlem, September 4, 2023, ECLI:NL:RBNHO:2023:8768

An employer was not allowed to deduct an amount for the excess number of taken annual holidays in the final settlement of the employment contract. By allowing the employee to take far more holidays than she was entitled to, the employer took the risk that the employee would no longer be able to catch up on the excess of holidays taken.
On October 3, 2022, a new employee started her employment at an airline in the position of a financial administrator. The salary in this position was € 3,200 gross per month.
The employment contract was entered into for a period of seven months and therefore would terminate May 2, 2023. That day, the employer sent the employee a letter confirming that her employment contract would be extended for a period of six months and that, henceforth, she would have the position of an administrative/operations employee for a gross salary of € 2,700 per month. Shortly afterwards, the employee terminated her contract, observing a one month's notice period.
The final settlement of the employment contract to be made then, led to disagreement between the parties. First of all, the employee claimed compensation equal to a one month's salary because the employer had not complied with the legally required notification obligation on whether or not to extend the employment contract one month prior to the end of the contract at the latest. In return, the employer settled an amount for the excess of holidays taken. Shortly after commencement of her employment, the employee had taken a six-week holiday to Suriname and had, subsequently, taken several holidays, including a two-week holiday in February 2023.The employee did not take it lying down and claimed payment of the notice fee and the overdue salary with the Sub-district Court.
The Sub-district Court awarded the notice fee. Since the employer had failed to comply with the timely notice obligation, the employer owed this notice fee.
The employee's request for payment was also timely submitted to the Sub-district Court, since it was submitted within three months after the moment at which the employer should have given the notice.
As for the excess holiday days taken, the employee stated that it had been agreed upon commencement of the employment that these days would not be regarded as holidays and that they would not be set-off. The employer denied this statement.
The Sub-district Court considered it quite unlikely that such an agreement would have been made so soon after commencement of an employment. Anyway, the employee had not shown any evidence of this agreement. Nevertheless, the Sub-district Court held the opinion that the employer was not allowed to deduct the excess of the holidays taken from the final settlement. The employer knew that the employee had already used more holidays than she was entitled to after her holiday in Suriname, and he should have ensured further increase of the shortage. By failing to do so, according to the Sub-district Court, the employer had self-inflicted that the employee had no longer been able to catch up on the excess of holiday hours taken. The employer had even further frustrated this option by not extending the employment contract under the original conditions, but under unilaterally deteriorated conditions.
This had led to the employee’s resignation, as a result of which she did not even have the opportunity able to catch up on the excess of the holidays taken.


The law does not provide for the possibility of settlement of excess holidays taken.
Therefore, it will be useful to include the employer’s right to offset excess holiday days taken against the employee's wages in employment contracts. In any case, it would give the employer a stronger position when it comes to the settlement of such excess holidays.
But even then, situations may arise (such as in the above case) in which the Court reaches the conclusion that the settlement of excess of holidays taken may be contrary to good employment practices. Whatever the circumstances, employers would do well to prevent negative balances of holidays from increasing too much. This may imply a “no” to a request for more holidays.
If it is an employee’s strict wish to be free, the employer is free to require that the employee agrees to take unpaid leave. This will also avoid a lot of post settlement.