- Overview: Belgium
- Global PEO and payroll
- Global HR Compliance
- Work permit for hiring expats via PEO
- Expand without a company set up
- Contractor vs. employee: which is better?
Global HR Compliance in Belgium
If you hire international workforce, or plan to hire employees, then Hiring and Firing Workforce in Belgium Guide below will help you understand the nuances of labor legislation in the country.
Companies hire international workforce for various reasons but in most cases they are:
- entering the foreign markets to sell company products. To do so, the company hires sales representatives who would represent their product and sell it to their local client base.
- hiring a global talent with unique skills that is unavailable in the local market or costs the company less than the talent with similar skills hired in the home country.
Before entering a certain foreign market or engaging a global talent, it is crucial for the company to understand how it can make local hires and reward its workers on a monthly basis. Growing companies often face a challenge of paying benefits and bonuses to the commission-based independent sales representatives they are working with.
If you intend to hire and pay your foreign workforce in full compliance with labor laws and regulations of Belgium, then the Global Employer of Record service from Acumen International may be the best way for you to go. We are an International PEO company and we specialize in global employment, meaning we can employ your employees in Belgium and act as their legal employer on your behalf. We will payroll your foreign workforce monthly and provide benefits to them through our global network so you don’t have to set up your own legal entities there.
We are experts in global workforce employment in , and our goal is to become your single provider. Instead of working with numerous local staffing agencies and legal advisors, Acumen International can solve your global business challenges and save you time, costs, and resources.
Our team of English-speaking professionals frees you from working through language nuances. Acumen International works 24/7 and can assist you whenever you need, regardless of time zones. Our goal is to create tailored labor solutions for you that are managed legally and in full compliance with the local employment laws.
With our knowledge and deep understanding of local nuances, you easily satisfy your need for skilled professionals in your global industry. With our qualified local partners, you can trust that your global workforce satisfies all local tax, social security, and immigration requirements in Belgium.
Hiring and Firing Workforce in Belgium Guide
There are different types of employment contracts. The contract can be determined by, for example, the nature of the work (e.g., blue-collar workers, white-collar workers, and sales representatives) and the employment conditions (full-time or part-time). The duration of the employment contract may also differ. In this respect, there are four possibilities:
- An open-ended employment contract.
- A fixed-term employment contract.
- An employment contract for a clearly defined project.
- The contract for a worker substitution.
Permanent contracts/Open-ended contracts - contracts that are for an indefinite length of time. Although it is not compulsory for permanent contracts, it is best to obtain a contract in writing. Employees have a right to ask for such a document to be provided and should receive it within two months of starting employment. Subsequent changes to the employment terms must be communicated in writing within one month of the change. The contract will normally contain the following:
- Name and address of the employer and employee.
- Date that employment commences.
- Place of work.
- A description of duties.
- Pay and how this will be calculated and paid.
- The length of any trial period.
- The hours and days to be worked.
Specific-assignment contracts – contracts which come to an end when the relevant work has been completed.
Replacement contracts – contracts which are for an employee to replace an existing employee who is absent for a reason, such as maternity leave, etc. The contract must detail the identity and the duties of the person replaced and the reason for and length of the contract. These may not exceed two years.
Temporary Contracts – contracts between an individual and a temping agency where the individual is then placed with a client for a period of time. These are usually for a maximum of six months. For more information.
Part-time contracts - contracts for less than the normal 38-hour week (sometimes unemployment benefit can continue while the employment lasts) Part-time contracts must be concluded in writing at the latest at entry into service. The written document must detail the employee’s work schedule on a daily and weekly basis. In principle, a part-time employee’s work schedule must be a minimum of three hours per worked day.
Fixed-term contracts – contracts that specify a start and an end date for the employment. As an exception to the general rule, fixed-term contracts must be in writing and must be signed prior to entry into service. Non-compliance entails an automatic requalification of the employment relationship into a contract for an indefinite term.
There are three categories of collective agreements:
- National collective agreements concluded at national level by all employee organizations and all employer federations. These collective agreements are very similar in status to the law as they automatically apply to all employees and all employers in Belgium.
- Sector collective agreements concluded at sector level. These collective agreements automatically apply to all employees and employers in the relevant sector (e.g., the metallic fabrications sector or the chemical sector, etc.).
- Company collective agreements concluded at company level. These collective agreements are concluded at company level by one employer and (at least) one trade union; they only apply to the employees employed by the company which concluded the agreement.
# Employment Termination and Severance Pay (Dismissal)
A permanent/open-ended contract can be terminated at any time by an employee by observing the period of notice. All employees with more than six months of seniority have the right to be informed of the reason for their dismissal. If the employer fails to inform the employee of the reason for dismissal, the employee can require the employer to give an explanation. If no (timely) explanation is provided, the employer owes a lump-sum civil fine of two weeks of salary. The employee is entitled to dispute the reason for dismissal before the labor court. Employees engaged under an open-ended employment contract may claim damages, ranging between 3 and 17 weeks of salary, in the labor court if their dismissal is ‘unjustified’. An ‘unjustified dismissal’ would be considered as a dismissal (for reasons unrelated to the employee’s capability or conduct, or to the operational requirements of the undertaking, and which would never have been decided upon by a normal and reasonable employer. If a party has committed a serious fault, the employment contract can be terminated for serious cause without the serving of a notice period or the payment of an indemnity. The employer can have various reasons for dismissing someone: there can be economical or structural reasons, or poor performance. The dismissal must not be manifestly unreasonable.
# It is prohibited to dismiss
Employees may also be protected on the basis of a statutory provision, for example:
- Employees who enter into a confrontation with the employer to represent the interests of the employees within the company.
- Employees who need to take a critical attitude towards the employer within their function.
- An employee who suspends the performance of his/her employment contract in whole or in part or because he/she files a complaint against the employer.
# Notice period
For the notice period there is just one relevant criterion: the number of years of seniority (per started calendar year). The traditional criteria for age and salary are no longer relevant. If the employee resigns, notice periods apply that are half as long as the periods that apply in case of dismissal by the employer, with a maximum notice period of 13 weeks. The notice period will be extended by the period of the suspension based on legal suspension grounds (for example, sickness, injury or holiday). If the notice period is six months, and the employee takes two weeks holiday and is absent due to sickness for one week, the notice period will only end after six months and three weeks instead of the initial six months.
# Severance payments
Severance payment (indemnity in lieu of notice): An employer can choose to either terminate an employment contract with the granting of a notice period or to terminate the employment contract immediately with the payment of an indemnity in lieu of notice. A combination of both, where the serving of a notice period is followed by the payment of an indemnity for the remainder of the notice period is also possible. The indemnity in lieu of notice is calculated on the basis of the annual salary of the employee at the time of termination, including statutory and contractual fringe benefits. If the employment contract is terminated with the payment of an indemnity in lieu of notice, no formalities need to be complied with; this is contrary to termination through serving a notice period.
#Employee Benefits and Contribution
Mandatory benefits required by law to be provided by an employer
The employer must pay a monthly remuneration that is in line with the minimum wages. The employer must also pay the premiums that are laid down in CBAs concluded at the level of the joint committee or at the level of the company (insofar as the employee is indeed covered by the scope of application of such CBA). The employer must pay a transportation allowance, which is an indemnity for the employee’s travel from home to the place of work. The amount depends on the relevant joint committee, the distance, and the type of transportation means used by the employee. The employer must also provide the employees with the equipment and tools required to carry out the agreed work. In practice, the employer pays the monthly salary as well as an end-of-year premium according to the terms and conditions agreed upon at the level of the joint committee. Most joint committees stipulate the payment of such premium.
Non-mandatory benefits that are offered by an employer
Employees and employers usually include the following benefits in the compensation package, but none are legally compulsory:
- Collective bonus, warrants, profit sharing.
- Meal vouchers, or other vouchers, such as eco-cheques, sport cheques.
- Group insurance benefits, which allow for additional retirement benefits at the moment the employee retires, and/or survivor benefits in the event of the death of the employee before the retirement age; and/or disability coverage.
- Medical insurance scheme.
- Company car.
- Portable PC, mobile phone, internet connection, etc. (generally for white-collar employees).
- Stock options, or other plans.
# Probationary period
Once you have found a job, there can be a probationary period of up to two weeks for blue-collar workers, and anywhere between one and six months for white-collar workers if the annual wage does not exceed around EUR 36–37,000. White-collar employees earning more than this may have a trial period of up to 12 months. During this period, either side can terminate the employment within seven days’ notice. Trial periods or probation arrangements are common in Belgium but are only valid if they have been put in writing. There is normally a probation period of three months, and a written contract should be signed before starting.
Overtime work is normally prohibited, although there are several exceptions to this rule. Where overtime is authorized, overtime pay is at least 1.5 times the employee’s regular rate of pay, and twice his/her regular rate if the overtime is performed on a Sunday or a public holiday. Employees also benefit from paid rest periods in case of overtime. Rules relating to working hours and overtime pay do not apply to, amongst others, sales representatives, homeworkers and employees in a managerial role or a position of trust within the company. Overtime is work beyond the daily (nine hours) and/or weekly working time limits. Overtime is only allowed in certain cases (for example, including shift work, work with perishable and unstable materials, an exceptional increase in workload) and under very specific conditions. Additionally, compensatory rest is required. Employees can work up to 120 overtime hours per year and must sign an agreement authorizing overtime hours.
# Work hours
Employees are not allowed to work more than 38/40 hours (depending on the industry) a week on an average basis and nine hours a day. However, some categories of employees are excluded from the scope of the working time rules. Any hours worked over the limits set by an applicable collective labour agreement (or, if there is no such agreement, the number of hours worked over the weekly limit of 38) are considered to be overtime.
# Annual Leave
In Belgium, full-time employees are usually entitled to 4 weeks’ leave a year. This leave gives entitlement to holiday pay. However, the calculation of the number of days’ leaves and holiday pay is different for blue-collar workers, white-collar workers, apprentices, workers in the arts and civil servants.
# Sick Leave
White-collar employees are entitled to receive a guaranteed salary paid by the employer during the first month of work incapacity. Thereafter, the health insurance organization will pay the incapacitated worker an illness and disability allowance. Guaranteed salary is not due, however, if the employee becomes newly incapacitated, an incapacity that is not related to the work, within 14 days after a first incapacity that entailed the payment of guaranteed salary.
# Parental Leave
After having informed an employer of her pregnancy, an employee is entitled to a reasonable amount of paid leave to attend prenatal appointments, provided that those appointments could not have been made outside normal working hours. Belgian employees are entitled to 15 weeks of paid maternity leave. A pregnant employee is protected from dismissal from the time an employer is informed that she is pregnant until one month after the end of her maternity leave. If an employer terminates a pregnant employee’s contract without proving that the termination does not relate to reasons of pregnancy, the employer will be liable to pay the employee a sum equal to six months of salary. During the pregnancy leave, the employee is not entitled to any guaranteed salary from her employer. Instead, she will receive a maternity allowance from her health insurance fund.
The employee has the right to be absent from work for ten days, within four months of birth. In the event of the death or hospitalization of the mother, maternity leave can be converted into leave for the employee who is the father. The employer pays the full salary during the first three days of leave.
Acumen International can help you fast-track your possibilities of entering and expanding your business in Belgium by providing you with an Employer of Record solutions that allows you to jumpstart your global operations almost immediately, cost-effectively and compliantly.