SWT (system of unemployment with employer supplement): (re)valuation of the reference wage and the employer supplement

An employee who benefits from the system of unemployment with employer supplement (the conventional early retirement scheme of the past) is entitled to an unemployment allowance payable by the National Employment Office and an employer supplement (early retirement allowance) that is in principle payable by the employer who dismissed him or her.

The employer supplement corresponds to half the difference between a capped net wage (for a reference month) and the unemployment benefits granted for the same month.

Net wage means the gross monthly wage less personal social security contributions and the normal deduction of income withholding tax.

The gross monthly wage is capped, with this ceiling being reviewed each year on 1 January, i.e. ‘revalued’ by the National Labour Council on the basis of a coefficient calculated according to the conventional evolution of wages and salaries.

For 2018, this coefficient has been set at 1.0036.

Consequently, the amount of the gross reference wage for the calculation of the employer supplement has been set as from 1 January 2018 at EUR 3,953.88.

In principle, the amount of the employer supplement is also reviewed by the National Labour Council on 1 January of each year in accordance with the conventional evolution of wages and salaries.

This revaluation coefficient varies according to the reference month taken into account for calculating the employer supplement.

Sources: Collective Labour Agreement no 17/38 of 19 December 2017 amending and implementing Collective Labour Agreement no. 17 of 19 December 1974 introducing a supplementary allowance scheme for certain older workers who are made redundant.

Author: Brigitte Dendooven

11/01/2018