Koan Law Firm

1

GENERAL PRINCIPLES

Forums For Adjudicating Employment Disputes

The labour courts have exclusive jurisdiction in actions and claims related to employment disputes. The chambers of the labour courts (of appeal) consist of a professional judge and two lay judges who represent employers and employees.


The Main Sources Of Employment Law

Belgium is a civil law jurisdiction. There is no general employment law code but different acts. The principle of social dialogue is very important and as a consequence, collective bargaining agreements, concluded at different levels, are a very important source of employment law.

The main sources, which are categorized following a clear hierarchy, are: the mandatory provisions of law, collective bargaining agreements concluded at national level, sector level and company level, the written individual employment contract, the company work rules, the non-mandatory provisions of law, the verbal individual employment contract and custom.


National Law And Employees Working For Foreign Companies

The parties can choose the law applicable to their contract. Even if the agreement does not provide for the application of Belgian law, the mandatory provision of Belgian employment law will apply anyway. This means in practice that all the essential elements of the employment relationship, such as working hours, remuneration, termination, wellbeing at work, etc. will be governed by Belgian law.


National Law And Employees Of National Companies Working In Another Jurisdiction

It will depend on the other jurisdiction whether it is possible to make Belgian law govern the contract. Specific rules can apply in case of temporary secondment abroad.


Data privacy

Employers must inform their employees that they collect, use, conserve, communicate or process in any other way, information on the basis whereof the employees are identified or can be identified. The processing of these personal data can be justified by the employers’ legal obligations and/or by the execution of the terms of the employment contract and/or on grounds of legitimate interest. It is recommendable that companies elaborate a specific privacy policy for HR purposes.

2

HIRING THE EMPLOYEE

Legal Requirements As To The Form Of Agreement

Although it is common practice to conclude written employment contracts, there is no legal obligation. A verbal contract is also valid. However, some clauses or particular contracts must be in writing to be valid (see “mandatory requirements” below).

An employment contract can never derogate from mandatory legal provisions nor from most of the collective bargaining agreements concluded at national, sector or company level.


Mandatory Requirements
  • Trial Period

    • Trial periods are not valid. There are two exceptions: trial periods can be inserted in contracts for temporary agency work and in contracts for students.

  • Hours Of Work

    • There are a lot of mandatory provisions, both at national and sector level. As a general rule, an average weekly working time of 38 hours is applicable but there are several exceptions to that rule. The applicable regime must be included in the company’s work rules.

  • Special Rules For Part-time Work

    • The work schedule of a part-time worker must be detailed, in writing, in the individual employment contract. The average weekly working time must be at least 1/3 of the working time of a fulltime worker. Under certain conditions, part-time workers will be given priority to obtain a vacant fulltime or part-time position with their employer. There shall be no form of discrimination between part-time and fulltime workers.

  • Earnings

    • There is a minimum wage applicable to all sectors. At sector level, there are minimum salary scales based on the workers’ experience and function.

  • Holidays/Rest Periods

    • Fulltime workers are per calendar year entitled to minimum 20 days paid leave (25 days if they work 6 days per week), provided that they worked during the entire previous calendar year. Part-time workers are entitled to a prorated number of days off.

    Besides, there are 10 fixed public holidays. Also, various compulsory rest periods must be observed in case of overtime.

  • Minimum/Maximum Age

    • The minimum age of employment is 15. Legal provisions determine the conditions of work for children of particular ages and young workers. There is no maximum age.

  • Illness/Disability

    • During periods of illness or disability, the employment contract is suspended. White collar workers are entitled to the payment of their full salary during the first 30 days. Blue-collar workers are entitled to the payment of their full salary during the first 7 days and to a degressive percentage of the salary during the following 21 days.

    In the event of long term illness, a reintegration process can be started in order to allow the employee to return to his/her position, or to another position, possibly under other conditions if required by his/her health situation and if feasible for the employer. The reintegration process can also lead, if several conditions are met, to the termination of the employment contract for force majeure.

  • Location Of Work/Mobility

    • Apart from health & safety conditions, there are no legal requirements with regard to the place of work. In case of fulltime or part-time telework or homework, a written agreement is required. Specific mandatory provisions apply to telework or homework.

    The work location is considered by the labour courts as an essential employment condition, which means it cannot be changed unilaterally by the employer. However, employment contracts can contain a mobility clause which gives the employer, within certain limits, more flexibility.

  • Pension Plans

    • Employers offer frequently extra-legal pension plans, especially to white-collar employees. However, there is no obligation unless decided otherwise on sector level. If an employer offers such a plan for a specific category of personnel, all employees belonging to that category must be affiliated.

  • Parental Rights (Pregnancy/ Maternity/ Paternity/ Adoption)

    • There are specific, detailed regulations on the workers’ rights and/or protection against dismissal in case of pregnancy, maternity and paternity leave, adoption, foster-parenthood and parental leave.

    Maternity leave includes 6 weeks before the presumed date of birth (optional leave) and 9 weeks after the date of birth (compulsory leave). If the employee has not taken all of the optional leave, she can take the remaining days or weeks after the birth of her child, in addition to the 9 weeks of compulsory leave minus 1 week that must be taken before the presumed date of birth. If the employee is subject to Belgian social security law, she will be entitled, during the leave period, to maternity benefits paid by the public health insurance.

    Paternity leave includes 2 weeks (10 days) that can be taken freely, on a continuous way or not, during the first 4 months after the date of birth. The employee is entitled to the normal salary during the first 3 days. For the next 7 days, the employee will be entitled to an allocation paid by the public health insurance.

    There are two types of parental leave that can be combined and that can give rise to the payment of an allowance by the unemployment office:

      1. Time credit to take care of a child younger than 8: maximum 51 months per employee, full-time or part-time, if certain conditions are met (seniority, feasibility for the company);
      2. b) Parental leave to take care of a child younger than 12: maximum 4 months full-time per child (or a longer period part-time).
  • Compulsory Terms

    • Some clauses and contracts must be in writing to be valid, for instance a non-compete clause, the work schedule of a part-time worker, a contract concluded for a definite period, a student contract, a telework contract, etc.

    At company level, it is compulsory to have work rules.

  • Non-Compulsory Terms

    • The parties to the employment contract are free to agree upon any other terms in addition to the compulsory provisions, provided that these terms are not less favourable to the employee than the minimum mandatory statutory rights.


Types Of Agreement

Employment contracts exist in several different forms: definite period of time or indefinite period of time, fulltime or part-time. The compulsory terms apply regardless of the type of agreement.

The workers are given an employment status, which has its own regulations (namely manual or blue-collar worker, white-collar worker, sales representative, temporary agency worker, teleworker, etc.).


Secrecy/Confidentiality

Employment contracts for employees having access to certain information often include a specific clause on secrecy and confidentiality. As part of the general contractual obligation to act in good faith, and also based on the Employment Contract Act, the obligation of secrecy and confidentiality is applicable to every employment relationship, even if such obligation is not expressly mentioned in the contract.


Ownership of Inventions/Other Intellectual Property (IP) Rights

The employer holds the property rights on inventions made in the course and within the scope of the employment contract. The normal remuneration is mostly considered as a fair compensation. The same principle governs intellectual rights on computer programs, databases and trademarks and designs. The employee holds the copyright on literary or artistic work and related rights, unless otherwise agreed.


Pre-Employment Considerations

Employers must respect the principle of equality of treatment of the candidates who must receive complete information about the function. Questions about a candidate’s private life are only permitted if they are relevant given the nature and the conditions of the function.


Hiring Non-Nationals

Employers are obliged to ensure that all employees are entitled to work in Belgium. Citizens of the European Union, the European Economic Area and Switzerland do not need a work permit. Other foreign employees need a combined residence and work permit that is delivered by the regional authorities. Conditions and formalities vary depending on the reason for employment in Belgium and the employee’s nationality. An employer will be subject to administrative or criminal proceedings if they employ a person who is not entitled to work in Belgium.

 

Hiring Specified Categories Of Individuals

There are restrictions on who can be employed to carry out certain dangerous activities and on the types of work for vulnerable groups, such as children or pregnant women.


Outsourcing And/Or Sub-Contracting/Temporary Agency Work

As a ‘general rule’, the lease of personnel is prohibited by the Belgian Act of 24 July 1987 on temporary work, agency work and the lease of personnel. There is a prohibited lease of personnel when an employee formally employed by a company actually works (and is therefore used by) another company and does so under the (partial) authority of this user company.

An established prohibited lease of personnel entails several risks for both the employer and the user company. There are several consequences for the contractual relationship with the employee. According to the Belgian Supreme Court, any unpaid invoices for a prohibited lease of personnel, issued by the employer, cannot be collected before a court as they stem from a contract which is null and void due to an illicit cause. Also, the social inspectorate can, on its own initiative or at the request of a third party such as the employee, initiate an audit that can lead to severe criminal or administrative sanctions.

However, the lease of personnel is allowed within the framework of:

    1. the occasional temporary lease of personnel, insofar as a tripartite agreement is concluded by the employer, the user company and the employee, (a) in case of an intra-group lease of personnel or, (b) after authorization by the social inspectorate and unanimous decision of the trade union delegation, at the condition that the lease of personnel is not part of the normal activities of the employer and only permanent employees are leased to the user company.
    2. temporary agency work.

Temporary agency work and the development of such activities is heavily regulated. Each region demands that agencies obtain a prior authorization before they can start their activities on the Belgian market. User companies may only call on temporary agency work in 4 circumstances:

    — Temporary replacement of a permanent employee whose employment contract is suspended, who reduces his/her work performance or whose employment contract is terminated; or

    — Temporary increase in workload; or

    — Exceptional work; or

    — Inflow/insertion.

Specific time limits apply depending on the reason for the temporary agency work. Moreover, if the user company has a trade union delegation, in some cases, the user company’s trade union’s consent is required. Even more strict conditions apply in the construction sector.

Finally, an admissible subcontracting/delivery of services requires that (i) an actual service can be identified (the service cannot merely consist in leasing employees) and (ii) the legal and formal requirements are met, including only a limited number of instructions that can be given by the customer to the employees of the service provider, provided they are listed in a detailed and precise way in the service agreement and take place within the framework of the service that is delivered.

A service provider is assumed to have a certain knowledge in a particular field. The subcontractor will provide his/her services and his/her expertise to a customer who lacks and is in demand of this specific expertise.

In the framework of subcontracting, only a limited transfer of authority over the employees to the customer is permitted. The core of the employer’s authority remains at all times with the employer and is not transferred in practice to the customer.

3

MAINTAINING THE EMPLOYEE RELATIONSHIP

Changes To The Contract

If both parties to the employment contract agree, they can change the terms of their contract at any time.

The employer may not unilaterally change in a substantial way the essential working conditions.

The employee may regard such unilateral and substantial alteration by the employer as the expression of the wish to terminate the agreement. Consequently, the employee can claim the normal compensation in lieu of notice from the employer. To this end the employee must invoke the unilateral modification of an essential element as unlawful dismissal within a reasonable time for reflection after the alteration has been made. If the employee exceeds this time for reflection and continues to work, then he/she waives his/her right to invoke breach of contract, even if the further implementation of the employment contract takes place under continued protest.

The employee may also file a request before the labour court in order to obtain the dissolution of the employment contract.


Change In Ownership Of The Business

When there is a change in the ownership of a business or a part of a business which gives rise to a change of employer, all employees are automatically transferred to the new employer on the same terms and conditions. There is an obligation for both the former and the new employer to inform their employees. The transferor and the transferee are also both responsible for the existing debts at the day of the transfer and resulting from the employment contract.

Changes in shareholding ownership, without a change of employer, do not have any consequences for the employment contracts.


Social Security Contributions

Employers and employees are required to pay social security contributions (rates are determined by the law). In practice, the payment of the contributions is the employer’s responsibility. Such contributions finance the national social security which in turn pays for employee benefits (e.g. sick pay, pensions, unemployment allowances).


Accidents At Work

Employers have a legal duty to have regard to the safety and welfare of their employees. Employers are also responsible for accidents caused by the acts of their employees where the employees were acting in the course of their employment. Breaches of the employer’s statutory duties may give rise to criminal and civil liability. It is compulsory for the employer to take out insurance to cover the risk of accidents at work.


Discipline And Grievance

Employers can impose a disciplinary sanction in so far this possibility is provided for and detailed in the work rules. The sanction must be notified to the employee within 24 hours of the knowledge of the breach. As a general rule, it is not compulsory for employers of the private sector to follow a specific procedure before dismissing an employee. However, sector regulations or the employer’s work rules can provide for a dismissal procedure to be followed. Besides, specific procedures must be followed in case of dismissal of trade union delegates, depending on the nature of their mandate. The elaboration of a grievance procedure is not required, except for situations that fall into the scope of the legislation on the prevention of psychosocial risks at work including stress, violence and moral and sexual harassment at work. Derogating rules apply to employers of the public sector.


Harassment/Discrimination/Equal pay

Every employer must have a policy on the prevention of psychosocial risks at work including stress, violence and moral and sexual harassment at work. Employees who make a formal complaint for harassment or violence, and employees who are witnesses in such cases, benefit from protection against dismissal and against unilateral changes of their working conditions. The complaint can be filed internally, at the social inspectorate or before the labour court. Before the court, the victims of violence or harassment can claim damages.

Employees are also protected from discrimination on grounds of sex, age, sexual orientation, marital status, race, religion or belief, language, political opinion, disability, current or future state of health, part-time status and fixed-term status. Discrimination may occur before the employment relationship commences (for example in advertising the job), during the employment (for example in failing to promote), on termination or even after the employment has ended. The discrimination may be direct (for example refusing to employ someone on the grounds of their sex), or indirect (for example by imposing a condition which is irrelevant to the job but is such that fewer people of a particular group can qualify). Victims of discrimination can file a complaint before the labour court and claim damages.

The principle of equal pay has been enshrined in the national collective bargaining agreement nr. 25. Employees who lodge a complaint on this basis benefit from protection against dismissal.


Compulsory Training Obligations

The objective is that every employee (fulltime equivalent) benefits from 5 days training per year. The concrete measures can be taken at sector level or at company level. For now, these measures must provide for 2 training days per year and for a roadmap for growth for the following years.

There are derogating rules for companies employing less than 20 employees. Companies employing less than 10 employees are exempted from this obligation, unless otherwise agreed at sector level.


Offsetting Earnings

It is possible for employers to offset earnings against employee’s debts, but only in a very limited number of situations and upon strict respect of the legal conditions.


Payments For Maternity And Disability Leave

The employment contract is suspended during maternity and disability leave. Except in the case of guaranteed remuneration paid by the employer during the first month of disability, the employee receives allowances from the national public health insurance and is not paid by the employer.


Compulsory Insurance

The subscription of an industrial accidents insurance that covers accidents at work and on the way from home to work is mandatory. The premium is totally paid by the employer. The amount depends on the remuneration and the risks involved in the performed work.


Absence For Military Or Public Service Duties

Employees are entitled to take leave for military or public service duties.


Works Councils or Trade Unions

Social dialogue plays an important role in employment law, at company level but also at sector level and at national level.

Employees are of course free to join a union. Employers do not have the right to know the identity of these employees.

An employer with 50 employees or more must organize social elections for the establishment of a Committee for the Prevention and Protection at Work, that considers any matters related to wellbeing at work and health and safety.

An employer with 100 employees or more must also organize social elections for the establishment of a Works Council that considers any matters related to the economic and employment situation of the company.

In some matters, these bodies must be informed. In other matters, they must be given the opportunity to advise and discuss a specific issue.

Members of the Works Council and the Committee, as well as non elected candidates for the social elections benefit from extensive protection against dismissal. They can only be dismissed for serious cause or for economic reasons, and only upon prior authorization by the labour court and/or the joint committee.

At sector level, the conditions are determined for the establishment of a Trade Union Delegation which has the role to assist individual employees. In the absence of a Committee, the members of the Trade Union Delegation take the role of the members of a Committee and benefit from the same protection against dismissal. In the absence of a Works Council, they take up the role of the members of the Works Council when specifically provided for by the law.

Generally, the members of a Trade Union Delegation benefit from a specific protection against dismissal that is determined at sector level and that is less strict than the protection of the members of the Works Council and the Committee.


Employees’ Right To Strike

The right to strike is indirectly recognized under Belgian law. Strike actions are authorized, provided they do not involve illicit actions or vandalism. Not only the trade unions have the right to call a strike. Collective bargaining agreements can provide for a conciliation procedure which must be followed before calling a strike.


Employees On Strike

Employees who participate in a strike are not entitled to the payment of their salary. If the strike is organized or recognized by the trade unions, the employees will receive a payment from their trade union.

Employees on strike do not benefit from a specific protection against dismissal. However, the general rules on manifestly unreasonable or abusive dismissal can apply.


Employers’ Responsibility For Actions Of Their Employees

Employers are civilly liable for the acts of their employees, except where the employee was acting outside the course of his employment. Where harm is caused to the employer or third parties, employees are only liable for their wilful misconduct, gross negligence or habitual minor negligence.

4

FIRING THE EMPLOYEE

Procedures For Terminating the Agreement

As a general rule, employment contracts can be terminated without the involvement of a third party such as a labour court or the joint committee. Only in very specific cases, derogating rules apply.

Some forms of termination require the compliance with legal formalities. That depends on the type of termination and on the employee status.


Instant Dismissal

(a)

If the employer decides to terminate the contract with immediate effect, no specific formalities apply. For reasons of proof of the dismissal and of the dismissal date, the employer shall hand over a letter saying that the employment contract comes to an end with immediate effect and he shall ask the employee to sign a copy for receipt. If the employee refuses to sign the copy, it shall be sent to him by registered mail.

This is a common way for an employer to terminate an employment contract. An employee can also choose this option but that never happens because of the financial consequences.

Because no notice is given, the party that ends the contract must pay an indemnity that is equal to the employee’s remuneration during the theoretical notice period (theoretical notice period, see hereafter: “termination on notice”). This indemnity in lieu of notice must be paid at once and not monthly as the remuneration is.

The remuneration to be taken into account for the calculation of the indemnity is not only the actual remuneration paid on a monthly basis. It also includes all advantages and benefits in kind acquired by virtue of the contract (private use of a car, contributions paid by the employer to a group insurance scheme, the double holiday pay, end of year premium, variable remuneration of the last 12 months, etc.). In practice, one must first make a calculation of the annual gross salary. Based on that amount, the indemnity must be calculated and will be expressed as a certain number of months and weeks.

The indemnity has in principle a lump-sum character. It is deemed to cover all damages resulting from the termination of the employment relationship.

(b)

A party can terminate the employment contract instantly and without the payment of an indemnity if the other party is guilty of gross misconduct (serious cause). Strict formalities must be observed. The contract must be terminated within 3 working days after having been informed of the serious cause. Further, within 3 working days after the termination, the party that terminates the contract must notify the other party in writing of the reason for dismissal. Such a letter must be detailed and must be served by registered mail, by hand or by a bailiff writ. If these formalities are not complied with, or a if a labour court decides afterwards that there was no serious cause, an indemnity in lieu of notice must be paid.


Employee's Resignation

The agreement can be terminated by the employee’s resignation. The employee has to respect the applicable notice period, otherwise they must pay the indemnity in lieu of notice. Specific rules apply to contracts concluded for a definite period.


Termination On Notice

The parties can terminate the agreement for an indefinite period on notice (special rules apply however to contracts concluded for a definite period).

If the employee resigns, the notice periods to be respected range from 1 week to 13 weeks depending on the employee’s seniority.

For determining the notice period applicable in the event the employer gives notice, two distinct periods will be taken into account. The results of the two calculations must be added up.

    1. For the seniority acquired until 31 December 2013, the old dismissal rules apply, with small alterations.

      2. White-collar workers:

      • Gross annual salary < 32,254 EUR in 2013: three months for every started period of five years’ seniority
      • Gross annual salary ≥ 32,254 EUR in 2013: one month of notice per started year of seniority, with a minimum of three months, or conventional agreement applicable on 31 December 2013.

        • Blue-collar workers:notice periods determined by collective bargaining agreement concluded at sector level or Royal Decree applicable on 31 December 2013, or as determined by more favourable conventional agreements applicable on that date.

    2. For the seniority acquired as from 1 January 2014, new dismissal rules apply. The notice periods are fixed and depend only on the employee’s seniority.

        3. Length of service Notice period in the event of termination by the employer
        From 0 to less than 3 months 1 week
        From 3 to less than 4 months 3 weeks
        From 4 to less than 5 months 4 weeks
        From 5 to less than 6 months 5 weeks
        From 6 to less than 9 months 6 weeks
        From 9 to less than 12 monthse 7 weeks
        From 12 to less than 15 months 8 weeks
        From 12 to less than 15 months 9 weeks
        From 18 to less than 21 months 10 weeks
        From 21 to less than 24 months 11 weeks
        From 2 years to less than 3 years 12 weeks
        From 3 years to less than 4 years 13 weeks
        From 4 years to less than 5 years 15 weeks
        As of 5 years + 3 weeks per started year of seniority    
        From 20 years to less than 21 years     + 2 weeks per started year of seniority
        As of 21 years + 1 week per started year of seniority  

Termination By Reason Of The Employee's Age

If notice is given to terminate the contract when the employee reaches the age for legal retirement, the maximum notice is 26 weeks.

The legal age for retirement is 65 years. It will be 66 years as from February 1, 2025 and 67 years as from February 1, 2030.


Automatic Termination In Cases Of Force Majeure

The contract can be deemed terminated where intervening events make its performance impossible in the long term. The contract will not come automatically to an end but each party can invoke the case of force majeure as reason for the immediate termination of the contract. No indemnity must be paid.

The most frequent case of force majeure is the impossibility in the long term to perform, for medical reasons. In that specific case, a strict procedure must be followed before an employer can conclude that there is a case of force majeure.

Other examples are rare.


Collective Dismissals

The regulations relating to collective redundancies apply when, over a period of 60 days, a minimum number of employees are dismissed for reasons not related to the individuals themselves. The number of employees depends on the total number of employees employed by the company.

Before taking the decision, the employer must inform and consult the works council (in the absence of a works council: the trade union delegation) of his intention to proceed with a collective dismissal. The employees’ representatives must be given the opportunity to make counter-proposals, to which the employer must respond in a serious manner. The employer must also notify the sub-regional employment service of his intention.

The actual decision to proceed with a collective dismissal can only be taken after the information and consultation phase. The employer may not dismiss the employees who will be made collectively redundant before the expiration of a period of 30 days beginning on the date of disclosure of the decision to the director sub-regional employment service.

It is recommendable for the employer to have concluded a social plan with the trade unions before going ahead with the dismissals.

Very strict and derogating rules apply to the dismissal procedure itself. The company must also establish an employment cell to improve the dismissed employees’ opportunities to find another job.

Additional sector regulations may apply. In case of closure of business, both the rules on collective dismissal and closure apply.


Termination By Parties’ Agreement

The parties are entirely free to agree upon the termination of the employment contract on any grounds they choose, without any notice or indemnity. It is however possible to provide for the payment of an indemnity. This kind of termination does not require any formality, but it is preferable to sign an agreement to avoid litigation.


Directors Or Other Senior Officers

There are no special rules which relate to the termination of a director or other senior officers’ employment, but in the case of a statutory director, termination of employment does not automatically bring to an end the directorship, which can only be terminated in accordance with the provisions of corporate law.


Special Rules For Categories Of Employee

Special rules apply to specific categories of employees, such as sales representatives, temporary agency workers or students.

Certain employees benefit from protection against dismissal, such as candidates to the social elections (very specific and strict rules apply to them), members of the trade union delegation, pregnant women, employees who benefit from parental leave or another kind of interruption, employees who put a complaint for harassment or discrimination, employees who have the function of DPO, etc. It is possible to terminate the contract of protected employees, but only for a reason that is not related to the reason of the protection (this is not so for candidates to the social elections who can only be dismissed for serious cause or for economic reasons).

Each situation is different. It is therefore highly recommendable that employers keep for every employee a detailed record with this information that must be consulted if a dismissal is being considered.


Whistleblower Laws

There is no general rule. There is one in the banking sector. Employees who give specific information to the Financial Services and Market Authority benefit from a protection against dismissal.


Specific Rules For Companies in Financial Difficulties

Companies in financial difficulties can benefit from derogating rules in case of collective dismissal and closure of business.

In case of an individual dismissal, companies in financial difficulties can be authorized to pay the severance indemnity on a monthly basis while, normally, it must be paid at once.

In order to avoid dismissals, these companies can use the system of temporary unemployment for economic reasons.

Finally, if an employer fails to pay the remuneration or severance indemnity, the employees can receive a capped amount from the Closure Fund.


Special Rules For Garden Leave

Garden leave does not exist under Belgian law. However, the parties can agree that, during the notice period, the employee will be exempted from the obligation to perform and will continue to receive his/her normal salary on a monthly basis, in which case the employee will be obliged to register with the public employment service in order to start looking for a new job. That is only possible with the employee’s consent. If he/she does not agree, there are only two possibilities: either he/she serves notice and he/she actually works, either the employer terminates the agreement with immediate effect and immediate payment of the total severance indemnity.


Restricting Future Activities

It is possible to insert a non compete clause in the contract of an employee where the entry into service with a competitor after termination of the agreement could harm the employer. Such a clause is subject to strict requirements. Specific conditions apply to sales representatives and employees working for an employer that has an international field of activities, has important economic, technical or financial interests in international markets and/or has its own research and development department.


Severance Payments
  • Indemnity in lieu of notice: see above chapter “instant dismissal (a)”. On top of the indemnity in lieu of notice, an employee might be entitled to one or more of the following indemnities.
  • Employers have to provide a reason for dismissal if the employee requests it. If the employer does not provide a reason for dismissal, the employee is entitled to an indemnity equal to two weeks’ salary. Also, employees can claim an indemnity from 3 up to 17 weeks’ salary for manifestly unreasonable dismissal, i.e. dismissal without objective grounds related to the employee’s behaviour or skills or to the company’s needs. Certain categories of workers are excluded from this right.
  • A dismissal can also be considered abusive. Then, the employee will have to prove the employer’s fault, the material or moral damages and the relation between the fault and the damages.
  • An employee can be entitled to a protection indemnity if the dismissal is based on the reason why he benefits from that specific protection. For most protections, a lump sum indemnity of 3 or 6 months’ salary is provided for. For candidates to the social elections, derogating rules apply.

Special Tax Provisions And Severance Payments

Severance payments are subject to a specific tax regime. The applicable tax rate is the average rate applied to the employee’s income over the previous year of employment. This means the severance payments are not cumulated with the other revenues of the year during which they are paid.

An indemnity in lieu of notice is subject to the regular social security contributions. Indemnities for unreasonable or abusive dismissal and protection indemnities (except those for the candidates to the social elections) are not.

Indemnities for moral damages are not subject to taxation but the tax administration only accepts this if a court decision clearly underlines that the indemnity covers moral damages.


Allowances Payable To Employees After Termination

Unless otherwise agreed, employers are generally not required to contribute to any allowances to employees after termination. One exception is early retirement: then the employer must pay an additional allowance to the unemployment allocations.


Time Limits For Claims Following Termination

Contractual claims must be submitted within one year of termination of the contract. A longer period of five years applies to claims that can give rise to criminal proceedings, such as all claims related to remuneration issues.

5

GENERAL

Specific Matters Which Are Important Or Unique To This Jurisdiction

There are three national languages in Belgium: Dutch, French and German. Under Belgian law, special attention must be paid to the detailed legislation on which language is to be used in a professional capacity between employer and employee and in all official documents (such as the employment contract, a notice letter). The main rule is that the language to be used depends on the place where the company is located (Dutch, French or German speaking region, with special rules for Brussels). There are different sanctions in case of infringement of these rules. On 16 April 2013, the European Court of Justice decided that, as a consequence of these rules, the free movement of workers within the EU is at risk in a cross-border employment situation. As a consequence, in cross-border situations, documents can also be drafted in another language of the European Union, but for translation purposes only.



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Contact a Contributing Author:
Robert De Baerdemaeker
Koan Law Firm
Belgium


Hilde Smout
Koan Law Firm
Belgium


Disclaimer:

© 2021, KOAN law firm. All rights reserved by KOAN law firm as author and the owner of the copyright in this chapter. KOAN law firm has granted to Multilaw non-exclusive worldwide license to use and include this chapter in this guide and to sublicense Lexis Nexis, a division of RELX Inc. and its affiliates certain rights to use and distribute this Guide.

The information in the How to Hire and Fire Guide provides a general overview at the time of publication and is not intended to be a comprehensive review of all legal developments nor should it be taken as opinion or legal advice on the matters covered. It is for general information purposes only and readers should take legal advice from a Multilaw member firm.

Publication Date: June 2021