Be Aware - April 2025

Employment Appeal Tribunal of Brussels: Risks of partially performing notice periods

An employer wanting to terminate an employment contract can choose between respecting a notice period or paying an indemnity in lieu of notice. An employee wanting to resign has the same choice, but few employees choose to pay their employer an indemnity in lieu of notice.

An employer can also choose to first implement a notice period and then effectively terminate the employment contract pending this notice period by paying an indemnity in lieu of notice of the remaining balance of the notice period. This option can be useful if the terminated employee has to help with the transition, for instance by working with a successor for a couple of weeks or months.

A judgement given by the Employment Appeal Tribunal of Brussels on 3 December 2024 shows this option can be risky.

The employer terminated an employee, notifying him on 27 October 2020 of a notice period of 3 months and 21 weeks, starting on Monday 2 November 2020. During this notice period, the employee was absent due to illness for 4 weeks and took 13 days holiday leave. On 26 March 2021, the employer effectively terminated the employment contract by paying the remaining balance of the notice period (18 weeks). The employer cited “cost savings” as reason for the termination on the unemployment form.

The first risk for the employer results from the fact the notice period is suspended if the employment contract is suspended due to sick leave or holiday leave. The four weeks’ sick leave indirectly increased the termination cost as a result of the sick pay due for those four weeks.

The employee argued the termination was manifestly unreasonable in the sense of collective bargaining agreement no. 109 concerning the reasons for a dismissal. He claimed the maximum indemnity of 17 weeks an employee can claim under collective bargaining agreement no. 109. He actually claimed 34 weeks. He thought both the initial notice period of October 2020 and the decision in March 2021 to effectively terminate the employment contract by paying an indemnity in lieu of notice would be manifestly unreasonable.

The employer argued at most only one indemnity for manifestly unreasonable dismissal could be due.

The Employment Appeal Tribunal noted that collective bargaining agreement no. 109 stipulates an indemnity of between 3 and 17 weeks’ remuneration is due for a manifestly unreasonable dismissal. For a notice period that’s partially performed, collective bargaining agreement n° 109 doesn’t specify whether this right relates to the initial notice period, or rather the decision to effectively terminate the employment contract pending this notice period.

In the comments included in the collective bargaining agreement, the National Labour Council points out the (former) article 63 of the 1978 Act on Employment Contracts inspired them. This article allowed a blue-collar worker to claim an indemnity of six months’ remuneration (on top of the normal notice period) if the dismissal was arbitrary. This was defined as a dismissal of a blue-collar worker where the employer couldn’t establish the dismissal was based on the conduct of the worker or the organisational requirements of the employer.

Concerning article 63, the Supreme Court held in a judgement of 25 November 1991 that the six-month indemnity for arbitrary dismissal is due if the employer proceeds to a dismissal for serious misconduct (ie with immediate effect and without payment of an indemnity in lieu of notice) pending a notice period and the employer should have known the invoked misconduct was fictitious.

The Employment Appeal Tribunal concluded the dismissed worker could claim manifestly unreasonable dismissal both in relation to the initial notice period of October 2020 and in relation to the effective termination in March 2021.

For a manifestly unreasonable dismissal, collective bargaining agreement no. 109 stipulates an indemnity of between and 3 and 17 weeks’ remuneration is due, depending on how manifestly unreasonable the dismissal was. Both the Employment Tribunal and the Employment Appeal Tribunal concluded the worker was entitled to only 4 weeks’ remuneration for the notice period of October and only 12 weeks’ remuneration for the effective termination of March 2021. In total, the worker received thus less than the maximum of 17 weeks’ remuneration for one termination.

In Belgium there’s no system of binding procedure. An Employment Tribunal could rule differently if a similar claim is introduced in the future. It is nevertheless prudent for an employer to verify the justification that can be invoked before proceeding to an effective termination pending a notice period.

 

Belgian government increases possibilities for employing students

Under certain conditions, students benefit from a specific employment law regime and a favourable social security regime. The new Belgian government has decided to increase the possibilities to make use of student work under this favourable social security regime.

Under the favourable social security regime, the employee’s social security contribution due on the remuneration of a student is 2.71%. The employer’s social security contribution for students is 5.42%. This is far lower than the rates for a “normal” employee, which are 13.07% for the employee and approximately 27% for the employer.

This favourable social security regime for students is subject to conditions:

• The first condition is that the person involved is enrolled as a student. If the National Office for Social Security challenges an employer using the regime for students, it’s up to the employer to establish the person involved was actually a student. If a student graduates in June, the National Office accepts the student performs student work up to the end of September of that year, provided at least it concerns work typically assigned to students. They don’t accept a graduate joining a company in a permanent position is during the summer registered under the regime for students.
• In the past, the favourable social security regime applied for a maximum of 475 hours per year per student. This is a cap per person, so a student working for two employers can still apply the regime for maximum 475 hours in total.

This cap was temporarily increased to 600 hours in 2023 and 2024. The idea was many employers lost their existing pool of students during COVID-19, so they should temporarily be allowed to employ their remaining students for a higher number of hours per year.

This temporary increase from 475 to 600 hours was only for 2023 and 2024, so on 1 January 2025, it returned to 475 hours.

The new coalition’s government agreement stipulates this cap will be increased to 650 hours per year on a permanent basis. Parliament approved a draft Act effectively increasing the cap to 650 hours, although this new Act was at the time of writing not yet published in the Official Journal. The new Act will enter into force 10 days after its publication.

• A written employment contract for student work is signed at the latest when the student starts working. This contract should specify some key elements of the employment relationship, such as the place of work, a brief description of the function to be performed, and remuneration.
• The first three working days under an employment contract for students are the trial period. During those three days, each party can terminate the employment contract with immediate effect and without payment of an indemnity in lieu of notice.
• A student can work for an employer under the same employment contract for a maximum of 12 consecutive months. If this threshold of 12 months is exceeded, the student becomes a normal worker, whose remuneration is subject to normal social security contributions. The law doesn’t specify a fixed minimum period between two employment contracts to be respected before a new period of 12 months starts. The National Office for Social Security takes the view it should be a genuine interruption between two employment contracts, eg a period of one month when the student has to take exams.