Group of 10 reaches agreement on employment conditions

In the very early morning of 26 February, the Belgian social partners in the so-called Group of 10 (the main representatives of employers’ federations and trade unions) reached the bones of an agreement on employment conditions for 2019-2020.

In this draft agreement, the margin for increases in Belgian salaries is set at 1.1%. This means that in addition to indexation salaries may be increased by up to 1.1% over the next two years without that increase being considered as exceeding the wage norm. This cap is designed to ensure that the cost of employment in Belgium remains competitive in relation to neighbouring countries.

Over the following months, it is intended that this margin of 1.1% will be further implemented at an industry-specific level, where it will be determined how individual sector employers should transpose this increase.

The draft agreement also allows employers to increase the amount of voluntary overtime on offer from 100 to 120 hours per year. Voluntary overtime does not give rise to a right to time off in lieu, only overtime pay. It is a productivity measure.

In addition, the maximum financial contribution of employers to the cost of public transport for the daily commute of their workers is increased from 64 to 70%.

There will also be enhanced possibilities for employees above 55 to decrease their working time by 1/5th or by half in order to improve mobility at the top end of the workforce age-scale and so increase opportunities for progression at the bottom.

Or have they?

The trade unions have not yet formally accepted the agreement. They had also insisted on an increase of the minimum wage by 10 – 40%, whereas the agreement only provides for an increase of that 1.1%. Will their membership accept this “weak” deal?

But there is also opposition from within the government. The draft agreement addresses the age of the so-called bridging pension, a Belgian regime whereby older employees who are made redundant receive an allowance from their former employer on top of their unemployment benefits. Since this regime has a detrimental impact on the activity levels of older employees by discouraging their re-entry to the workforce, it was generally agreed that the minimum age for the bridging pension should increase. 62 became the general rule yet for employees made redundant as part of a collective dismissal or company closure, the social partners have agreed to postpone using even the age of 60 for one year, leaving it at 58 for now, much to the dismay of some political parties. Wishing to be seen to make the right noises in advance of the elections in May 2019 is no doubt in large part to blame for their public indignation on what is, in terms of numbers, mostly a symbolic issue.

What does this mean for you as an employer?

For now, you can sit back and watch the political spectacle. By the end of the month we will know whether the unions formally support the agreement. If they do, it is over to the social partners to translate the deal into industry-level collective labour agreements. And if they don’t? Well, then we should probably brace ourselves for more political fireworks.