Your Belgian payroll administration in Q2.2023
Traditionally, we start spring with an overview of the main news items that have an impact on your payroll administration.
1. CHANGES TO TIME CREDIT AND THEMATIC LEAVE RULES
The federal government has decided to cut back on time credit and thematic leave schemes, on the one hand by reducing the benefits associated with them and on the other by tightening the conditions of application. Subject to exceptions, the new rules will apply from 1 February 2023. For details of the full rules, please refer to the NEO website. Below, we provide a brief list of the changes.
The introduction of an employment condition for full-time and half-time time credit with motive
Employees wishing to take full-time time credit with motive and receive benefits for this purpose must now have been employed full-time for either 12 months or 24 months prior to written notification to the employer.
Employees wishing to take half-time time credit with motive and receive benefits for this purpose must have been employed full-time for 12 months prior to written notification to the employer.
Time credit with ‘caring for a child’ motive: three cuts
- From now on, for full-time time credit with this motive, benefits will only be granted if the child is under 5 years old. For half-time or 1/5 time credit, there are no changes.
- From 1 June 2023, the employee must have a seniority of at least 36 months with the employer before entitlement to benefits will arise.
- Finally, the benefit will be limited to a maximum duration of 48 months.
Abolition of seniority and age surcharges time credit and thematic leave: two cuts
- Employees on full-time or half-time time credit with a seniority of five years were previously granted an increased amount. This will be abolished.
- Employees aged over 50 who take thematic leave half-time, 1/5 or 1/10 no longer enjoy an increased benefit.
2. TEMPORARY ECONOMIC UNEMPLOYMENT ‘ENERGY’ HAS EXPIRED
Because of the energy crisis, companies and their employees could claim the special scheme temporary economic unemployment “energy”. This came to an end on 31/03/2023. This was the last of several special schemes available in recent years. Consequently, since 1/04/2023, only traditional economic unemployment is available.
The days of temporary unemployment due to the energy crisis are treated as days actually worked. There is therefore no impact on the calculation of the days of annual leave and statutory holiday pay.
3. TELEWORK FOR CROSS-BORDER WORKERS – SOCIAL SECURITY IMPACT
A working group of the Administrative Commission for the Coordination of EU Social Security Systems very recently agreed on a Framework Agreement determining the applicable social security legislation for cross-border workers who telework on a regular basis.
This Framework Agreement means that from 1 July 2023, the social security legislation of the member state of the employer’s registered office can continue to apply to cross-border workers:
- who telework on a regular basis from their country of residence, other than the country in which their employer has its registered office; and
- who spend less than 50% of their total working time teleworking.
To benefit from this divergent scheme, the employees or employers concerned must submit an application in the employer’s member state. The competent social security institution will issue an A1 document upon agreement.
The submission to the social security system of the employer’s country applies for a maximum period of three years. Afterwards, you can submit a new application.
What is important, however, is that both countries have signed the Framework Agreement. If not, we must fall back on the well-known ‘25% rule’ from the EU regulation: an employee is socially insured in the country where he performs his work, unless he would also perform part of his work from his country of residence. In that case, the social security legislation of the country of residence applies when he performs at least 25% of his total working time in that country of residence.
Incidentally, the Framework Agreement cannot be applied when the employee carries out activities in his country of residence other than teleworking.
The Framework Agreement is effective from 1 July 2023, provided that at least two European member states signed it at that time. It will then remain in force for five years with automatic renewal for the same period each time.
Meanwhile, both the Netherlands and Belgium have already indicated that they will sign this agreement. In the coming months, it will become clear which other countries will join this story.
This agreement offers a welcome solution in terms of social contributions for many employees. Unfortunately, it does not apply on the tax front. So the double taxation treaties simply continue to apply to determine the division of taxing powers between the various countries.
4. COMPULSORY BICYCLE ALLOWANCE
In quite a few sectors, there are already regulations regarding bicycle allowances. In JC 200, for example, a bicycle allowance of EUR 0.20 per kilometre was introduced on 01/07/2022.
With a National Labour Council collective labour agreement, the bicycle allowance will be made compulsory from 01/05/2023 in all sectors and companies that do not have a bicycle allowance scheme at present. Although the existing sectoral regulations will continue to apply in full.
The National Labour Council collective labour agreement provides for a bicycle allowance of EUR 0.27 per kilometre provided the conditions below are met:
- there is regular use (at least once a week or every day in the summer months)
- one provides reimbursement for a trip of up to 40 km per day (single trip of up to 20 km)
To determine the amount of the allowance, a sworn statement will have to be signed stating the number of kilometres and the number of days per month.
The bicycle allowance is exempt from social security contributions and wage withholding tax and can be combined with commuting allowances for other modes of transport as long as they relate to different parts of the commute or different periods of the year.
5. SECTORAL ALLOWANCES IN JC 200
Several sectors foresee some sectoral allowances to be paid in the second quarter.
Thus, an annual sectoral premium is compulsorily payable in JC 200. The premium in 2023 amounts to a maximum of EUR 307.94 gross, i.e. if the employee has worked full-time for a full reference year (= 1 June 2022 to 31 May 2023). In case of part-time or incomplete employment, the amount is prorated.
In addition, eco vouchers allowing employees to buy ecological products and services are also payable. No taxes or social charges are paid on these vouchers – under certain conditions – which makes it interesting for both employee and employer.
For completeness, we note that an employer can also grant eco cheques worth up to EUR 250 per year at company level, without being obliged to do so by the sector.
6. HOLIDAY MONEY
In addition, we can gradually start dreaming of a nice holiday as the double holiday pay will also be paid out soon. The double holiday pay for white-collar workers amounts to 92% of the gross monthly salary. Workers receive their holiday pay from a holiday fund. Payment is usually made in May or June.
7. DRAFT AGREEMENT
As per biennial custom, the social partners have agreed on a draft text of the 2023-2024 interprofessional agreement. The draft agreement would address the following topics:
- the unemployment with company supplement (SWT – the former “early retirement pension”) scheme;
- the extension of collective labour agreement No. 159 on economic unemployment for white-collar workers;
- relance hours and an increase in tax-favoured overtime;
- An increase in the guaranteed minimum average monthly income (GMMI);
- The harmonisation of supplementary pensions;
- monitoring the role of the FPS ELSD in marginal monitoring of targets in the case of non-recurring result-related benefits (CLA 90);
- end-of-career time credit; and
- a range of various smaller topics.
Looking for more details? We will notify you in a separate newsflash as soon as the agreement takes its final form! In the current draft text, the social partners would already ask the government to take the necessary legislative initiatives by 1 June 2023 at the latest.
8. SOCIAL ELECTIONS
The obligation to organise social elections depends on your average workforce in the reference period from 1 October 2022 to 30 September 2023.
When making that calculation, you will also have to take into account your temporary workers in the current second quarter, except those replacing permanent employees (e.g. because of pregnancy or a period of illness). To this end, you should keep a register listing all temporary workers.
9. SICK DURING HOLIDAYS
As an employer, you may have already been confronted with an employee who fell ill while on holiday. At this point, the legislation left us a bit puzzled and lacked a clear answer to the most logical question: what happens to my employee’s leave days in that case?
Previously, the rule was that if the origin of your illness fell during your holidays, you “lost” those holidays. This will be different in the future.
If an employee falls ill during his or her holidays, the holidays should be able to be converted into sick days. After all, it is mandatory in Europe to guarantee all workers their annual holiday of at least four weeks. This holiday is designed to allow workers to rest and relax. This differs from being ill, which happens during sick leave. The converted holidays will be able to be taken at a later date, up to 24 months after the end of the holiday year to which the outstanding holidays relate.
Not only strict sick days are covered by these regulations. The scope extends to work accident, occupational disease, ordinary accident, maternity or paternity leave, prophylactic leave, adoption leave, foster care leave or a foster parent leave. If any of these events occur during your holiday days, these days can be converted into a sick day.
Work removal in maternity protection is a special case here. As a rule, the employee in maternity protection must still take her holidays before the end of the holiday year. Unless the employee can prove that she was unable to take her holidays during the period of work removal due to health reasons. Then these days will become eligible to be taken within 24 months.
The new regulations will apply to holidays for the first time in 2024.