Newsletter 2024 – 02

March 1, 2024

1 Office news

Mr. , March 5, 2024, Yves Thiery will provide an explanation and critical reflections on the judgment of the Antwerp Labor Court of December 13, 2023. The court ruled that a guarantee limitation of two years in a collective disability insurance, which only applies to insured persons with psychological conditions and not to those with physical conditions, does not meet the discrimination test. You can find more information and register here

2 Rush Hour HR – March 12, 2024 – cancelled

Unfortunately, we have to let you know that Rush Hour HR, which was scheduled for March 12, 2024, is canceled. You will hear from us as soon as a new date is announced.

3 Social inspector Franz Kafka

First fact. There are approximately 600,000 salary trucks on the road in Belgium. The employer pays a “solidarity contribution” to the RSZ on this benefit in kind, which is calculated on the basis of the CO2 emissions. The employee pays a tax that takes into account, among other things, the catalog value and CO2 emissions.

Second fact. The employer is obliged to pay his employee at least the wage determined in sectoral collective labor agreements. Some sectoral collective labor agreements do not specify which wage elements must be taken into account, but in others, including the liberal professions sector (PC 336), this is the case. The collective labor agreement states that all wage elements are taken into account, including benefits in kind. If the sum of the wage in money and the wage in the form of the benefit in kind reaches or exceeds the minimum wage, the employer complies with the sectoral collective labor agreement with regard to the minimum wage.

If the minimum wage is then hypothetically 2,000 euros and the employee receives a cash wage of 1,950 euros plus the private use of a company car, an employer may conclude that he pays more than the minimum wage.

Not so according to the social inspection. The benefit of private use of a company car is not included in the exhaustive list of benefits in kind that the employer may grant. See Article 6, § 2 of the Wage Protection Act of 12 April 1965. The benefit therefore does not count towards the minimum wage...

The inspector asks the employer to “correct” the wages. This leads to the hallucinatory situation that the employer has to increase the gross salary in money for an employee who already enjoys a benefit for which he does not have to pay social security contributions and on which he pays a rather symbolic tax. For a (diesel) car costing 30,000 euros, it will be taxed at a maximum of 200 euros per month. Do the math, if that employee drives 2,000 km per month privately (including commuting), he has already spent 200 euros on fuel alone.

The Constitutional Court recognized in 2014 that the legislator has developed a contribution scheme that is particularly advantageous for company vehicles compared to the social contributions due on other benefits in kind granted to employees (GwH 17 July 2014). The Court did not consider that this was an illegal advantage.

In Fundamental Rights and Social Security I wrote in 2016 that this indirectly discriminates against certain groups of employees, including women and workers.

And besides, the legislator can, on the one hand - in the Wage Protection Act - indirectly prohibit the granting of a certain benefit in kind and, on the other hand, not only tolerate but also regulate the same benefit separately - and very favorably for employer and employee - at the in terms of social security contributions and taxes?

Ludo Vermeulen, lawyer-partner
ludo.vermeulen@mploy.be

4 High and low wages according to the university (Knack February 7, 2024)

In the weekly magazine we read: “Anyone who switches from minimum unemployment benefit to a full-time job with a low gross monthly wage of 2,854 euros has much more money to live on.”

A “low gross monthly wage of 2,854 euros”?

In support of this statement, reference is made to a study by the Budget and Financial Well-being Expertise Center of Thomas More University of Applied Sciences.

Just took that report. That indeed builds an entire analysis and a number of conclusions on the premise that an unemployed person with a minimum benefit (who has therefore been unemployed for a fairly long time, otherwise he/she would not be on that minimum) “switches” to a job and immediately receives a (low! ) will earn a monthly wage of 2,854 euros. About 25% of employees do not have that much (see Statbel). Class B employees in the additional joint committee do not even reach that amount at the end of their career (see www.sfonds200.be).

Wouldn't it be more realistic to take, for example, the salary of a cleaner in a service voucher company as a point of comparison? His/her hourly wage is 13.36 euros. This results in a monthly wage of 2,199.95 euros. A regular nurse starts in a nursing home with a salary of 2,608.13 euros. A healthcare professional at 2,455.11 euros. He achieves the “low gross monthly salary” after 10 years of service.

Digged a little deeper. The researchers obtain the concept and measurement of a “low gross wage” from the OECD. It is the wage that is one third lower than the median gross wage. That should then amount to 2,854 x 3/2 = 4,281 euros. The report refers to Statbel data. They mention a median salary of 3,507 euros for 2021. The “low wage” in 2021 was therefore 2,338 euros. The researchers index that amount to 2023. With their method, this yields an amount of 3,995 euros. The low gross salary according to OECD standards is then 2,663.33 euros. It then remains unclear where the amount of 2,854 euros as a level of “low wage” comes from.

According to the Expertise Center study, around 14% of employees have a wage that is lower than two-thirds of the median wage. The latest Statbel report shows that this is approximately 25%... In any case, a study into the question of whether working pays that is based on a switch from a minimum unemployment benefit to a full-time wage of 2,854 euros may be academically interesting, but it certainly does not provide a realistic image of reality.

Wouldn't it be more interesting to know whether working at the bottom of the ladder in a retirement home or in a service voucher company really pays off?

Last year, the median salary was 3,300 euros, according to SD Worx. A low wage according to OECD standards is then 2,200 euros. That is much more realistic. There are some elements that can explain the difference between the Statbel data and the SD data. Statbel is based on a survey of employees. There will always be some noise in what employees say about their wages... SD uses the exact wage data. Statbel only surveyed employees who work for an employer with at least 10 employees and did not include a number of sectors in the study, including public administration, education and healthcare.

In any case, scientific research and its results will always have to be examined critically, especially if they want to support policy.