July 2014 Newsletter Employment Law

Transcription

1 July 2014 Newsletter Employment Law This Employment Law Newsletter of the HVG Employment Law section is to provide you with concise information on recent case law, legislation and current developments in the Belgian employment law arena. Content: Harmonization statute blue-collar workers and whitecollar employees

2 Harmonization statute blue-collar workers and white-collar employees 1. Belgium s employment law is recently significantly reformed as a result of a partial harmonization of the statute of blue-collar workers and white-collar employees. Both categories will continue to exist. We will only comment on the most important changes which have already been determined as more changes are expected in the future such as the important issue of occupational pensions. This reformation process took place because the Belgian Constitutional Court ruled on 7 July 2011 that this different treatment is discriminatory in respect of the determination of the notice periods and the so-called carenz day (first day of absence from work during less than 14 calendar days due to incapacity linked to illness and accident for which no legal obligation to pay a remuneration by the employer applied and limited to all blue-collars and some white-collars) and could no longer be accepted. A deadline of 8 July 2013 (which was not met) was set to eliminate the differences. 2. The social partners (employer and employee representatives) reached an agreement regarding the framework of the harmonization only on 5 July This agreement was converted by the Minister of Employment into a draft act of 21 November 2013 resulting into the reformed act of 26 December On the basis of the reformed act, the rules in respect of determining the notice period, the obligation of the employer to offer outplacement, the carenz day, trial period are adjusted as of 1 January Notice period (or period taken into account for the severance pay) The following notice periods in case of termination of an employment contract for unlimited duration are applicable as of 1 January Period of service is the only criterion in order to determine the applicable notice period. Duration Length of service By the employer By the employee 1 st quarter 2 weeks 2 nd quarter 4 weeks 3 rd quarter 6 weeks 4 th quarter 7 weeks 5 th quarter 8 weeks 6 th quarter 9 weeks 7 th quarter 10 weeks 8 th quarter 11 weeks Year 2-3 Year 3-4 Year 4-5 Year 5-19 Year Year weeks 13 weeks 15 weeks + 3 weeks per any started year of service + 2 weeks per any started year of service + 1 week per any started year of service At least 1 week up to 13 weeks in case of at least 8 years of service Newsletter Employment Law July

3 If the employee (both blue or white-collar) gives counter notice because he/she found another job after a termination of the employment contract by the employer, the notice period will be much shorter with a maximum of 4 weeks in case of past services of 12 months at least. The notice period always starts as from the Monday following the week during which the notice was validly given. The legal formalities to dismiss have not changed. For white-collar employees who have been employed before 1 January 2014, the notice period by the employer will be calculated as follows: a first notice period will have to be calculated for the period of service until 31 December 2013 on the basis of the following rules; a month per year of service with a minimum of 3 months will be taken into account for white-collar employees with a yearly gross salary above EUR 32,254 at 31 December 2013; 3 months per started period of 5 years of service if the white-collar employee earns a salary equal to or lower than that amount; in addition to the first notice period, a second notice period will have to be calculated, on the basis of the above mentioned new rules, for the period of service as of 1 January These two periods have to be added to determine the applicable notice period. The same principle of adding up applies for blue-collar workers. Specific rules, applicable before 31 December 2013 to blue-collar workers only, apply for the period of service until 31 December 2013, taking into account whether or not the worker started to work before the 1 st of January For some specific business sectors (for all blue-collar workers), a different method and fixed table for determining the notice period (on the basis of seniority) will apply till end of 2017 (and for certain blue collars even on a permanent basis) resulting into lower notice periods compared to the ones mentioned in the table above. It is not possible to derogate from the legally imposed notice periods with a collective bargaining agreement (CBA) concluded at the level of the business sectors. More favorable notice periods for the employees can be agreed upon in a CBA concluded at company level or in an individual employment agreement. During the notice period, all employees will benefit from the same possibility to be absent from work in order to find a job. Trial Period A trial period can no longer be inserted in the employment agreement, except for students and temporary agency workers. Trial periods in employment agreements that entered into force prior to 1 January 2014 will remain valid until the end of the agreed period. The abolishment of the trial period also has consequences regarding non-compete clauses and training clauses. Instead of having no effect in case of termination during the trial period, noncompete clauses and training clauses will have no effect during the first 6 months of the employment agreement. Moreover, for employment agreements for a fixed duration or a specific project concluded as from 1 January 2014, it will be legally allowed to terminate the contract prior to the expiration date applying the new table for determining the notice period. This is only allowed during the first half of Newsletter Employment Law July

4 the agreed upon period of the employment agreement with a maximum of 6 months. In case of legally allowed consecutive fixed term employment contracts (or projects), this new possibility of terminating the contract prior to the expiration date will only apply to the first agreement. Reason of the dismissal Important changes Under the reformed act the social partners had to negotiate a CBA regarding the motivation of the dismissal within the National Labor Council. Trade unions and the employer s federation finally agreed on Collective Labor Agreement (CLA) no.109 introducing an obligation to state the reasons for the dismissal and providing that the dismissal cannot be manifestly unjustified. CLA no.109 entered into force on 1 April CLA n 109 is applicable to employees, both blue and white-collars, with an employment contract. However, it does not apply to employees dismissed in the following circumstances: during the first 6 months of their employment. Previous and subsequent employment contracts of a definite duration, or interim work, for the same function with the same employer are taken into account to determine whether the first 6 months of employment have been achieved. during a temporary agency contract; during a student contract; to join the unemployment with company allowance scheme ( early retirement ); with a view to taking up legal pension the first day of the month following that during which they reach the legal retirement age; following final termination of all activities; following company closure; within a collective dismissal context. Furthermore, CLA n 109 is not applicable to employees for whom the employer must follow specific dismissal procedures determined by law or CLA, nor to employees who are subject to a multiple dismissal due to restructuring as defined at business-sector level. The employer must state the reasons for dismissal following the employee s explicit and written request, which should be done within a certain timeframe. The employer must inform the employee within 2 months after receiving his or her request. The response must contain all elements clearly providing the employee with the concrete reasons for his or her dismissal. The employer not responding to the employee s request must pay the employee the equivalent of 2 weeks salary as compensation. This amount can be added to compensation following apparent unjustified dismissal. A manifestly unjustified dismissal is defined as the dismissal of an employee with an employment contract of indefinite duration, i. based on reasons unrelated to the employee s aptitude or behavior or to operational needs in the company, institution or service; and, ii. which would never have been carried out by a normal and reasonable employer. Newsletter Employment Law July

5 In case of a manifestly unjustified dismissal, the employer must pay the equivalent of 3 to 17 weeks salary as compensation depending on the importance of the manifestly unjustified character of the dismissal. This compensation cannot be combined with any other termination payments, with the exception of a compensation in lieu of notice, a non-compete indemnity, a clientele indemnity or a supplement on top of social benefits. Outplacement For employees older than 45 years and with at least 1 year of past services at the moment of the dismissal by the employer, the entitlement to outplacement under the current rules will remain unchanged under the reformed act. New is that all employees will be entitled to outplacement of 60 hours via an external outplacement agency if they are entitled to a notice period of at least 30 weeks (or a corresponding compensation in lieu of notice). In case of a compensation in lieu of notice, the value of the outplacement package should reach 1/12 th of the annual gross salary of the previous calendar year with a minimum of EUR 1,800 and a maximum of EUR 5,500, which can be deducted up to 4 weeks of salary from the compensation in lieu of notice. In case of a notice period, this will remain 30 weeks at least without any deduction. The time spent on outplacement will be allocated to the time available for looking for another job. Carenz day The carenz day is abolished under the reformed act for all employees as from 1 January 2014, regardless of whether their employment agreement started before this date. Newsletter Employment Law July

6 HVG advocaten-avocats HVG advocaten avocats is a leading Belgian law firm with an outstanding reputation with regard to providing legal services. Our lawyers are active in all areas of law which are relevant to entrepreneurs and their businesses. Contact details T: 32 (0) E: info@hvglaw.be W: HVG advocaten avocats operates on a national and international scale, with offices in Brussels and with HVG in the Netherlands having offices in Amsterdam, The Hague, Eindhoven, Rotterdam, Utrecht and two legal desks in London and New York. We have corresponding offices in most jurisdictions in Europe and also in Asia, the Americas, Middle East, Africa and Oceania. HVG advocaten avocats has a privileged cooperation with EY Tax Consultants. HVG advocaten avocats is a civil company having the legal form of a cooperative limited liability company (BVCVBA/SCSCRL) organised and existing under the laws of Belgium, having its registered office at De Kleetlaan, 2, 1831 Diegem, Belgium and registered with the Crossroads Bank of Enterprises (Brussels) with registration number BTW/TVA BE HVG advocaten avocats All rights reserved Disclaimer This publication has been drawn up with the greatest possible care. HVG is not liable for any inaccuracies and/or incompleteness of the information provided in this publication,nor can any rights be derived from its contents. Newsletter Employment Law July