YOUR PAYROLL ADMINISTRATION IN Q2 – 2022
Now that spring is officially here, not only is the sun on its way, but also the second quarter of 2022. This again means some changes for your payroll administration. We have listed the most important novelties below.
1. New wage indexations
The high energy prices have triggered the wage indexation mechanism. Every employer is obligated to carry out such indexations, which can entail many additional costs.
As an employer, you can try to take future indexations into account when budgeting conventional wage increases (read: wage increases at company level for individual employees).
In the private sector, wage indexation is regulated by sector in collective labour agreements and there are generally two main systems. On the one hand, there are the sectors in which wages are indexed at a fixed point in the year with a percentage unknown in advance. On the other hand, there are the sectors in which wages are indexed with a fixed percentage (usually 2%) at a variable point in the year.
For some of the sectors that index at a fixed point in the year, the forecasts are as follows:
- In the Metal industry (JC 111 and 209) there will be an indexation on 01/07/2022. An indexation of 6.57% is expected;
- In the Construction sector (JC 124) wages are indexed every four months. On 01/04/2022 wages will rose by just under 3%;
- In the Supplementary Joint Committee for the White-collar workers (JC 200) wages were indexed by 3.58% on 01/01/2022. For 2023 an indexation of 4.90% is expected.
Forewarned is forearmed…
In these times of price increases, it is no unnecessary luxury to take a close look at your entire wage policy. Of course, Van Havermaet can help you with this!
Finally, we would like to point out that the indexation for the private sector also has an impact on various other wage components, such as the premiums for shift work and night work, the wage thresholds for the unemployment with company allowance scheme (SWT or the former early retirement pension), etc. You can find the current amounts here.
2. Sectoral allowances in JC 200
Several sectors planned that some sectoral allowances will have to be paid in the second quarter.
For instance, an annual sectoral premium has to be paid in JC 200. The premium amounts to a maximum of 277.22 EUR gross in 2022, i.e. when the employee has worked full-time for a full reference year (= 1 June 2021 up to and including 31 May 2022). In case of part-time or incomplete employment, the amount is prorated.
In addition, eco vouchers enabling employees to buy ecological products and services are also payable. Under certain conditions, no taxes or social security contributions are paid on these vouchers, which makes it interesting for employees and employers alike.
Please note: in companies, eco vouchers could be converted into an equivalent benefit until 31 October 2021. Employers who would have to grant eco vouchers for the first time in June 2022 have until 31 May 2022 to apply this conversion.
For the sake of completeness, we would like to point out that an employer can also grant eco vouchers at company level, worth up to 250 EUR per year, without this being obligatory for the sector.
3. Amendments to the exemption from payment of wage withholding tax
In order to stimulate or provide additional financial support to certain sectors, the law provides for “wage withholding tax discounts”. This means that the employer does not have to pay (part of) the wage withholding tax to the Treasury, but may keep it within the company, thus providing more (liquid/financial) resources.
As from 1 April 2022, some changes will come into effect:
Night work and shift work
The law stipulates that the arrangement concerning the exemption from payment of the wage withholding tax on premiums for night work and shift work must no longer be viewed and evaluated as one regime, but rather as two separate regimes.
The size of the compulsory night premium or shift premium will also be regulated, so that employers are no longer able to grant – in practice, sometimes occurring – insignificant ‘pro forma’ premiums.
For example, the law states that the premium for ‘shift work’ must increase the hourly wage by at least 2%. The premium for ‘night work’ must increase the hourly wage by at least 12%.
The premium must also be laid down in a collective agreement, in labour regulations or in an employment agreement. However, this formal obligation only has to be complied with as from 1 April 2024.
The fact that the so-called 1/3rd standard (1/3rd of working time must be performed in shift work or night work) is no longer judged by reference to working days but by reference to working hours, will be anchored in law.
With regard to the uninterrupted nature of consecutive shifts, the law now provides that an interruption of 15 minutes or less does not compromise the exemption regime.
As from 1 October 2022, temporary employment agencies may only use the exemption if they meet the general conditions and if their users also apply this exemption. Key is closing binding agreements with clients before applying the exemption.
Finally, with regard to the special exemption for shift work in the construction sector, it is stipulated that the exemption only applies insofar as the works have been reported to the NSSO in accordance with Article 30bis of the NSSO-Act.
Scientific research
In cases where you, as an employer, make use of the wage withholding tax discount for scientific research, and also claim the tax credit for research and development, the non-paid wage withholding tax may not be included (any more) in the calculation basis of this tax credit.
Procedural aspects
As of 1 July 2022, claims for refund of wage withholding tax, which are subject to an exemption from payment, will become time-barred after 3 years, counting from 1 January of the year following the year of assessment – instead of the previously applicable 5 years.
We also emphasise that the (voluntary) withholding of a larger amount of wage withholding tax than the minimum legally owed no longer provides a tax advantage. At least as far as the discounts for scientific research, start-up companies, support zones, sportsmen and merchant shipping/dredging/tugging sector are concerned. In particular, the excess of withheld wage withholding tax is no longer taken into account for the calculation of the exempted amounts.
The temporary employment sector withholds a regulatory minimum percentage of 11.11% of wage withholding tax (if certain conditions are met), but it was agreed at sectoral level to voluntarily withhold 18% of wage withholding tax. The higher percentage of 18% is to be anchored in future regulations.
Action points
What actions do you need to take urgently?
- Check whether you comply with the minimum premium described above, and by extension , formalise the granting of this premium by collective agreement, labour regulations or employment agreement;
- Make sure that in the future you assess the 1/3rd standard on the basis of working hours (and no longer on the basis of working days);
- If you are a temporary employment agency: inform your clients about the application of the discounts and make agreements if necessary;
- Make sure that the necessary supporting documents are always available. The withholding tax discounts have been under increased scrutiny by the tax authorities for several years now.
4. Extension of certain corona measures
For the (probably) last time, some corona measures were extended.
Amicable payment of social security contributions
If a company had difficulties paying the social security contributions as a result of the corona measures, it could already apply to the NSSO for an amicable repayment plan in 2020 and 2021. This possibility is now extended for (i) the social security contributions due for Q1/2022; (ii) the corrections of contributions due by 30 June 2022; and (iii) the annual holiday contributions due for the 2021 holiday year.
Extension of the simplified procedure for temporary unemployment
As a result of the conflict between Russia and Ukraine, the simplified procedure for temporary unemployment has been extended once again. All temporary unemployment, both full and partial, will be considered temporary unemployment due to force majeure Corona up to and including 30 June 2022.
Recognition as a ‘company having difficulties’
In order to be recognised as a company undergoing restructuring (in the context of SWT) or as a company in difficulty (in the context of start measure – young recruits under 26 years old), a number of days of temporary unemployment for economic reasons should normally be demonstrated.
It was already decided to include the days of temporary unemployment due to force majeure corona in the calculation of the number of unemployment days in 2020. That measure was now extended to the days of temporary unemployment due to corona in 2021.
5. Submission of annual report internal service for prevention and protection at work
No later than 1 April 2022, the annual report of the ISPPW must be submitted.
Every employer is obligated to draw up such a report, even if only one employee is employed. The report covers the operation of the prevention service during the previous working year (2021).
Both the director and the internal prevention adviser must sign the report. In companies with less than 20 employees, the director can act as prevention adviser, but in all other cases an employee must take on this role (Note: remember that a prevention adviser enjoys a protection against dismissal).
Failure to produce the annual report may result in a (criminal) sanction. However, it is no longer required to send the report to the inspection services. It is sufficient to keep it at the disposal of the FPS ELSD.
6. Increase in exempted amount of bicycle allowance as of 1 January 2022
The bicycle allowance can be granted to employees without social security contributions or wage withholding taxes being due. Since this year, the exempt amount is 0.25 EUR per kilometre (previously 0.24 EUR).
Attention: an employer is only obligated to grant this allowance if it has been determined on a sectorial level or on a company level. The amount of the bicycle allowance only needs to be increased if the maximum exempted bicycle allowance is used.
7. Flexible student work
In order to meet possible labour shortages in certain sectors as a result of the corona crisis, two laws were passed in February 2022 to facilitate student labour (at the date of this writing, the laws have not yet been published).
The measures are:
- Neutralisation of hours performed by a student (whether or not as a temp worker) with employers/users in the care sector or in education à the hours performed in Q1/2022 do not count towards the quota of 475 hours, so that the solidarity contribution can always be applied to performances in these sectors;
- 45 hours that the student has performed in Q1/2022, regardless of the sector in which he was employed, are neutralised. Consequently, the solidarity contribution in 2022 for all sectors can be applied to 475 + 45 hours.
The online quota counter with which the number of remaining hours in the quota can be consulted has already been adapted to both measures.