The new activation contribution

From 1 January 2018, an activation contribution is due by employers who allow their employees to be inactive a full quarter with preservation of (part of) their wage.

Context

The contribution was created as a result of the recent success of a new system of early retirement, which enables older workers to stop working with only limited loss of wages. In that case, the employment contract will continue to run and the cost of the wages will continue to be borne by the employer, but the legislator considers such scenarios as undesirable in a socio-economic context aiming to activate older employees.

Which employers?

The contribution is intended for employers to which the CBA Act of 05.12.1968 applies. They pay the contribution for each employee who takes a break as set out below, irrespective of his status (manual worker, non-manual worker…), length of service or age (there is no minimum or maximum age limit).

Type of break

The contribution is due if the employee does not work at all during the entire quarter with the same employer, except when this the result of:

• a suspension of the performance of the employment contract pursuant to the Employment Contracts Act of 3 July 1978;
• an exemption from serving the notice period.

The contribution is not due in all of the following cases:

• the employee has joined a mechanism of full exemption prior to 28 September 2017;
• the employee joins a mechanism of full exemption in application of a fixed-term CBA, registered with the Clerk’s office of the Directorate-General of Collective Labour Relations of the FPS Employment, Labour and Social Dialogue prior to 28 September 2017.

Contribution

The contribution is collected by the NSSO and is included in the DmfA.

It is a percentage of the wages paid during the inactivity period, however with a minimum quarterly lump sum. The percentage is set according to the age of the employee at the beginning of the inactivity period and does not change subsequently.

Exemption or reduction of the contribution

Exemption or reduction in the event of training

If the employee undergoes compulsory training during the period in which he is exempt from working, there is a reduction resp. exemption from the contribution.

Following training qualifies:

• either vocational training
• either one of the training courses referred to in the Act of 5 March 2017 on feasible and manageable work (the new inter-professional training objective of 5 days per year).

The employer must prove to the General Directorate of the Social Legislation Inspectorate (FPS Employment, Labour and Social Dialogue) that the employee really has attended the training pursuant to the terms and conditions laid down by the competent administration. The FPS Employment, Labour and Social Dialogue will report once a year to the NSSO.

Exemption in the event of resumption

When the employee, during the period of inactivity with the current employer, starts working with another employer or as a self-employed person, the current employer will be exempt from the contribution.

Only a resumption during an entire quarter gives entitlement to the exemption.

The resumption must be ‘new’: an activity already carried out prior to the period in which the employee was exempt from working normally, does not qualify.

Source: Programme Act of 25 December 2017 (Belgian Official Gazette of 29 December 2017).

Author: Els Poelman

19/01/2018