Appeals court awards director fired for fraud nearly €350,000

Listed leasing company Econocom must pay a director it fired for fraud and conflict of interest nearly 350,000 euros, according to a ruling by the Court of Appeals in Arnhem. The court did not disagree with the reasons for firing the director but ruled that the company made mistakes in his dismissal, and he is entitled to his bonuses and untaken vacation days, RTL Nieuws reports.

The man worked for the Utrecht-based Econocom - a company that rents out equipment and articles to healthcare companies, among other things - for 17 years, steadily rising to strategic director. He earned over 41,000 euros gross per month in that position, including bonuses.

In March 2020, Econocom fired the man with immediate effect. According to the employer, an investigation showed that the strategic director hired a befriended consultant who earned 2.2 million euros from Econocom. The director received substantial amounts of money from the consultant. The consultant also paid 60,000 euros of the director’s private costs, including parties for his spouse and son.

Econocom also found that other business relations paid for the director’s private purchases, like a television and a safe. The man also used Econocom money for personal expenses, like season tickets for Ajax, according to the employer.

After his dismissal, the director went to court to demand severance and back pay. The subdistrict court ruled against him. He appealed with partial success. In 2021, the Court of Appeal in Arnhem ruled that the director’s dismissal was justified but that he was entitled to 158,000 euros in overdue bonuses.

The final ruling published on Wednesday also showed that Econocom must pay the former director a fixed compensation of over 77,000 euros due to errors in the dismissal procedure. According to the court, the company took too long to fire the man with immediate effect. Econocom argued that it needed that time for a thorough investigation, but the court rejected that argument.

Additionally, Econocom has to pay out the former director’s 52 unused vacation days. That amounts to over 100,000 euros, bringing the total Econocom has to pay him to almost 350,000 euros.

The man is not entitled to fair compensation for wrongful dismissal, the Court of Appeals ruled. The man’s firing was justified. “He systematically crossed the limits of what is proper, which, precisely because of his exemplary function, is held heavily against him. In the court's opinion, he is, therefore, entirely to blame for the fact that his employment has ended,” the court ruled.

A spokesperson for Econocom told RTL Nieuws that the company was unpleasantly surprised by the ruling. “However, we will not leave it at that. Econocom has not only appealed against the court’s ruling but has also started other proceedings against the former employee. Both proceedings are still ongoing, and Econocom cannot comment on current proceedings.”

The director’s lawyer, Jeanette Stam, told RTL Nieuws that she would not cooperate with its article because she had no confidence in the objectiveness or expertise of the reporting.