Firm: Claeys & Engels

This article sets out some of the main employment law reforms recently approved or proposed for 2018 by the Belgian government.

A very busy year for legislation in Belgium in 2017 (the Belgian State Gazette published 117,002 pages: a record) will result in major changes in employment law in 2018. Below we set out some of the most significant, whether already in force or still in the preparatory phase. Further updates will follow as the legislative programme progresses.

New remuneration for workers: the profit bonus

A new bonus with which employers can motivate employees in a socially and fiscally attractive way has been introduced: the profit bonus. It offers companies the opportunity to share part of their profits with staff (with the exception of company managers) in the form of a collective cash bonus.

Companies are entitled to make entitlement to this bonus dependent on seniority (maximum one year). In some situations, a pro rata calculation can be used. The total amount granted cannot exceed 30% of the total gross payroll for the accounting year and the bonus cannot be granted in lieu of existing benefits. Employers can choose to offer two kinds of bonus: ‘identical’ or ‘categorised’. The identical bonus can be either an equal amount for all workers or an amount corresponding to an identical percentage of salary for all workers. A categorised bonus is calculated and allocated, based on objective criteria such as role or seniority, according to an allocation key.

The profit bonus is taxed at a rate of 7%. It is not subject to ordinary social security contributions. Instead a solidarity contribution of 13.07% is charged to the worker but withheld and paid by the employer in the same period and subject to the same conditions as ordinary social security contributions. The employer pays no contribution.

The profit bonus is not tax deductible for companies (which results in a cost equal to the

amount of corporate tax).

The conditions for introducing either form of profit bonus are set out below.