Standard Professional Employer Organization/Employer of Record service is likely not legally compliant for full-time employees in Belgium. Companies that provide such services out-of-compliance may in fact be subject to potential criminal penalties. However, Globalization Partners has done the difficult legal work to provide an alternate solution by way of our partner companies that meets the requirements for compliance in Belgium.
Through our solution, we can enable clients to run payroll in Belgium while HR services, tax, and compliance management matters are lifted from their shoulders. As a Global employment expert, we manage employment contract best practices, statutory and market norm benefits, and employee expenses, as well as severance and termination if required. We also keep you apprised of changes to local employment laws in Belgium.
Your new employee is productive sooner, has a better hiring experience and is 100% dedicated to your team. You’ll have peace of mind knowing you have a team of dedicated employment experts assisting with every hire. Globalization Partners’ solution allows you to harness the talent of the brightest people in 150 countries around the world, quickly and painlessly.
Belgium is a small country, sandwiched between the Netherlands and France, and also bordered by Germany, Luxembourg, and the North Sea. The country has a population of 11 million people and a land area roughly the size of Maryland, making it one of the most densely populated countries in Europe. Belgium is divided into three different cultures:
The German community is the smallest. The capital, Brussels, is a bilingual community with French and Dutch residents, many of whom speak both languages.
Basic facts about hiring in Belgium
Non EU citizens are required to have a work permit, which must be applied for by the employer. The employer must demonstrate that no local employee can be found to do the job.
In Belgium, most companies’ wages are fixed by collective agreements. The collective agreements are the result of negotiations between trade unions and employers. In addition, salaries in Belgium are indexed, meaning they are automatically increased each year based on the health index and linked to local cost of living increases.
When negotiating terms of an employment contract and offer letter with an employee in Belgium, it may be useful to keep the following standard benefits in Belgium in mind:
Belgium celebrates 10 public holidays for which employees are given the day off, including:
If any of the public holidays fall on a weekend, the day becomes a floating holiday, which the employee is entitled to use like any vacation day.
Most employers pay a 13th month bonus to their employees and a few even add a half of a 14thmonth’s pay to that, typically payable at the end of the year.
The standard work week in Belgium can be no longer than 38 hours. After 38 hours, workers must be paid overtime. This generally does not apply if the employee is a senior executive or manager.
If work time limits are passed, compensation of overtime is compulsory.
Annual vacation leave in Belgium is provided all at once at the start of the year, based on the number of months worked in the previous year.
Office employees are entitled to a holiday (vacation) bonus of 1/12 of 92% of the gross salary for the month in which the holiday starts, multiplied by the number of months worked in the holiday credit year (previous calendar year).
Manual workers are entitled to 8% of 108% of their gross pay in the previous year paid by the holiday fund the employer is affiliated with.
Employees are entitled to sick leave and there is no maximum number days; however each incidence must be accompanied by a doctor’s note.
Pregnant women are entitled to a maternity leave and an allowance during that leave. There are two periods of maternity leave:
A maternity fee is mandatory for the birth of every child and the amount of the maternity fee depends on the child’s rank in the family. The highest amount is for the first born child.
Male employees have the right to paternity leave for 10 days.
On January 1, 2014, probationary periods were abolished, except for temporary and student contracts.
Under the new dismissal rules effective January 1, 2014, notice periods are measured in weeks, based on years of service.
Health insurance is provided through the national system. Employees are legally required to register with a health insurance fund in order to be entitled to health insurance.
Some employers also offer a variable profit sharing or performance-related bonus whereby the company pays an annual sum (usually at the end of the year). The amount of the bonus depends on the company’s overall performance and may be calculated as a percentage of each employee’s annual or monthly salary over the period.
Some companies provide benefits such as private school fees or car allowances. These additional benefits are usually taxable and should be considered when calculating an employee’s net take-home pay. For clients using our solution, we suggest providing an allowance or a gross salary inclusive of all of these costs, or a base salary plus allowances as appropriate.
Stock options are often requested by executives working for US technology companies in Belgium. Unlike most countries, Belgium taxes on the grant of an option or when the offer is communicated to the employee. The employee then has a period of 60 days to accept or reject the option. Issuing options to employees in Belgium is complex and they are subject to tax; most US companies prefer to offer cash bonuses tied to profitability rather than stock options. Globalization Partners cannot permit clients to issue stock options to designated managers hired through our solution in Belgium.
Bottom Line on Benefits
Generally, we recommend budgeting 35% as benefits cost on top of the gross salary to allocate the total employer’s cost including benefits in Belgium.
It is legally required and best practice is to put a strong employment contract in place in Belgium which spells out the terms of the employee’s compensation, benefits, and termination requirements. An offer letter and employment contract in Belgium should always state the salary and any compensation amounts in Euro rather than a foreign currency.
This information is provided as general accepted information and is not intended as advisory services.
Why Globalization Partners
Establishing a branch office or subsidiary in Belgium to engage a small team is time consuming, expensive and complex. Belgium labor law has strong worker protections, requiring great attention to detail and an understanding of local best practices. Globalization Partners helps make it painless and easy to expand into Belgium. We can help you hire your candidate of choice, handle HR matters and payroll, and ensure that you’re in compliance with local laws, without the burden of setting up your own foreign branch office or subsidiary. Our Belgium employment solution provides you piece of mind so that you can focus on running your business.
If you would like to discuss how Globalization Partners can provide a seamless solution for hiring an employee in Belgium, please contact us at sales@globalization‐partners.com.