Occupational pensions (so-called second-pillar pensions) will be subject to important changes in the coming years, with a significant impact on the occupational pension plans applicable in Belgian companies. In May 2014, a new act was published in the Belgian State Gazette which provides for the gradual phase-out of differences in treatment of blue-collar and white-collar employees with respect to occupational pension plans. Some actions can already be taken in preparation for the phase-out, and any future modifications to pension plans should be handled with caution.
The new statutory provisions form part of the progressive harmonisation of the status of blue-collar and white-collar employees under Belgian law, which resulted in fundamental changes to the Belgian dismissal rules earlier this year.
The gradual phase-out of differences in treatment of blue-collar and white-collar employees with regard to occupational pensions will occur in three stages, in order to give employers sufficient time to implement the necessary changes and avoid major financial difficulties due to harmonisation.
Stage I: Employment before 1 January 2015
Existing pension plans which distinguish between blue-collar and white-collar employees will not be considered discriminatory.
Stage II: Employment between 1 January 2015 and 1 January 2025
The following rules shall apply, subject to a stand-still obligation:
- Any differences in treatment of blue-collar and white-collar employees in pension plans existing before 1 January 2015 shall not be considered discriminatory, provided the employer initiates a harmonisation process to phase out such differences by 1 January 2025.
Thus, as from 1 January 2015, a company should initiate harmonisation by e.g.:
- contacting actuarial experts and/or (legal) consultants in order to request specific cost calculations;
- examining harmonisation options;
- assessing the advantages and disadvantages of the various options;
- listing the various solutions and discussing them with the employee representative bodies;
At the same time, employers should closely monitor the discussions at sector level. Indeed, the sectors must enact a regulation on this subject no later than 1 January 2023. Several deadlines are provided.
If on 1 January 2023, it appears that a sector has not taken any action, employers in that sector which have not yet taken measures will have until 1 January 2025 to make the necessary adjustments to their occupational pension plans, so as to eliminate any differences in treatment between blue-collar and white-collar employees.
- New pension entitlements which will be introduced for the first time on 1 January 2015 can no longer distinguish between blue-collar and white-collar employees (except in the event of a transfer of an undertaking, a merger or when the new pension entitlement provides for a difference which is intended to counterbalance differential treatment existing on 1 January 2015).
- For existing pension entitlements, no new differences in treatment between blue-collar and white-collar employees can be introduced, unless their purpose is to neutralize existing differences.
Stage III: Employment as from 1 January 2025
As from 1 January 2025, any difference in treatment in (sector- and company-level) occupational pensions of blue-collar and white-collar employees will be forbidden.
However, differential treatment based on other criteria, e.g. seniority, salary or classification (management, sales representatives, etc.), will still be possible.
Even though a lengthy transition period applies and the sectors should take the necessary measures to harmonise pension plans, employers need to start the harmonisation process mentioned in Stage II as from 1 January 2015.