Belgium has adopted new rules permitting the conclusion of employment contracts electronically, provided secure electronic signature and archiving systems are used. This highlights both the growing comfort with digital contracting and the increased role that trusted third parties, providing electronic signature systems and archiving, play in this expanding digital environment.

One of the objectives of the E-commerce Directive 2003/31/EC was to remove obstacles to the use of electronic contracts. Member States were to amend their legislation to remove any requirements which were likely to curb the use of contracts by electronic means or which would deprive electronic contracts of legal effectiveness and validity.

The Directive provided four explicit exceptions to this principle where Member States may provide that contracts cannot be entered into by electronic means. These exceptions covered contracts related to real estate (except for rental rights), contracts requiring the involvement of courts or public authorities, certain contracts of suretyship and collateral securities, and contracts governed by family law or the law of succession. The four exceptions listed by the Directive were incorporated into Belgian law by Article 17 of the E-commerce Act of 11 March 2003.

Employment contracts were not included in the list of exceptions but the Directive provides that the contractual relationships between employees and employers is not an information society service and are therefore outside the scope of the Directive. Legal writers have therefore regarded employment contracts as an implicit exception. The E-commerce Act remains silent on employment contracts.

On 3 June 2007, a new Article 3bis was inserted into the Employment Contracts Act of 3 July 1978. The new Article provides that an employment contract which is signed by means of the electronic signature created by the Belgian electronic identity card (eID), or by any other electronic signature which meets the same security standards as the eID signature, has the same force as a signed hardcopy contract.

A further Royal Decree will establish the security standards for the creation of electronic signatures (other than the eID). Providers of electronic signature systems will be able to register with the Crossroads Bank for Social Security who will draw up a list of accepted systems. This list will be approved by the Minister of Employment Affairs and published on the website of the Crossroads Bank for Social Security.

The new law explicitly provides that neither the employer nor the employee can be forced to conclude an employment contract electronically. This reiterates the principle in the Electronic Signatures Act of 9 July 2001 which stipulates that, unless provided otherwise by law, no person can be obliged to commit a legal act by electronic means.

A copy of any electronic employment contract needs to be stored by a digital archiving service provider offering guarantees with regards to confidentiality, security, impartiality, transparency and financial stability. The cost of this archiving needs to be borne by the employer and not the employee. Employers must be able to immediately present a copy of the electronic employment contract to the authorities, using either their own electronic copy or the copy archived with the service provider.

An electronic employment contract must be stored for a minimum period of five years following the termination of the contract. During that period, the archived copy needs to remain accessible by the employee at any time.

As a consequence of the new law, employers wishing to use electronic employment contracts may have to involve two trusted third parties – a digital archiving provider and, unless using eID, an electronic signature provider.

The new provision on electronic employment contracts therefore provides a good example of the growing importance of trusted third parties in the digital environment. In Belgium, these trusted third parties, including providers of digital archiving systems, are now subject to their own legal framework following regulations made on 3 July 2007 (see our IT & E-commerce Law Bulletin - October 2007).