Belgium: Social partners involvement in unemployment benefit regimes

  • Observatory: EurWORK
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  • Published on: 20 Diciembre 2012



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In Belgium, the social partners are at every level of the unemployment benefit regimes. They have the opportunity to discuss, negotiate and get adviser’s position on a lot of issues in this field. However, in the past few months, they will know a lot of challenges to do to imply the governmental agreement from December 2011. In this case, social actions as strikes take place.

1. The characteristics of the UB system in the country

In the last ten years, the Belgian unemployment benefits’ system has not been significantly modified. However, among what already existed, some developments took place. For instance, in 2004, some attendant measures were created by the Government to help unemployed people to find a job (this means, as well, the creation and the development of training to give them the opportunity to be more adaptive to the market’s needs). In addition to this, it was established a monitoring of unemployed people availability. The aim pursued by these measures is to decrease the unemployment rate in Belgium. Among the unemployment benefits in Belgium, we can make the difference between the unemployment insurance and the social assistance.

Table 1: Types of Unemployment Benefit and Social Assistance programmes
 

Benefits

Main qualifying conditions

Funding

Unemployment Insurance (UI)

earnings-related

involuntary unemployment - employment record - actively looking for work

contributions from employer and, sometimes, also employees, often topped by government payments

Unemployment Assistance (UA)

social minimum, partly means-tested

unemployment insurance expired or not eligible for it - (often) a short employment record - actively looking for work

contributions from employer and employee and/or government payments

Social Assistance (SA)

social minimum, comprehensively means-tested

unemployment insurance expired or not eligible for it - (for most categories of claimants) actively looking for work

taxes

1.1. Recent changes/transformations of the UB system in your country:

1.1.1. In the last 10 years, has the country’s UB regime been modified? Have new forms of interventions been introduced?

If yes, , please specify what has been changed / which innovations have been introduced, focusing more on the most recent/ most relevant transformations of the UB system:

  • Regarding the UA: Currently in Belgium, the unemployment assistance does not exist

1.1.2. For each of these changes/innovations indicate:

  • date of introduction: 1st November 2012
  • the content of the change / of the new programme:
Table 1

Step 1

For the first 12 months of unemployment, the new rules initially slightly increase the amount of benefit paid. In this first year, there are three phases:

a) In the first three months, the allocation is 65% of the previous wage – up from the current rate of 65% – with a gross limit of €2,324 a month;

b) For the next three months, this decreases to 60%;

c) For the next six months the benefit remains at 60%, but the gross limit reduces to €2,166

Step 2

Duration of minimum two months for people who did not find a job yet, this can be extended (for instance, two months more per year worked). During this period, unemployment benefits will be limited to €1,238 for a cohabiting person with children or other dependants; €1,111 for those living alone; €826 for a cohabiting person.

Step 3

Unemployment benefit is limited to 24 months, and to €1,209 for a cohabiting person with children or other dependants; €1,072 for those living alone; €757 for a cohabiting person.

Step 4

Unemployed people then receive a fixed rate of €1,090 per month for a cohabiting person with children or other dependants; €916 for those living alone; €484 for a cohabiting person.

Notes

Between the first and the fourth step, there is a decrease of 12% for a cohabiting person with children or other dependants; 17.5% for those living alone; 41.5% for a cohabiting person.

  • the aim pursued:

This plan was thinking as an incentive for unemployed people to find a new job. Thereby, there are two major underlined issues: the reduction of the cost of unemployment in Belgium and the re-launch of the labour market, as well.

1.1.3. For each of these changes / innovations please indicate from the main SP who was in favour or supported and who was against or resisted to it, and why:

1.2. The main characteristics of the UB system as it is now

Focusing now on the current situation, please specify the characteristics of the existing programmes:

1.2.1. Unemployment Insurance.

  • Coverage: (a general view of the groups that could potentially receive the UB) who is covered by the programme? Are all workers covered? Are there specific categories of workers (for instance, economically dependent and/or self-employed) who are not covered? Are there specific programmes dedicated to specific categories of workers?

The unemployment insurance covers all people more than 18 years old who are looking for a job or recently left it.

  • Eligibility: (turning to the individual level) indicate the criteria which have to be met by the potential beneficiaries in order to receive support (monetary or other).

The insurance can be obtained after a year for people who have never worked, only if he does not find a job during this period. For others, the insurance can be obtained if they have already worked (if less than a year, a ratio of waiting period should be calculated).

  • Duration: indicate the minimum and the maximum duration of time during which workers can avail of the unemployment insurance.

See 1.1.2.c)

  • Replacement rates: indicate the benefits’ amount in proportion with previous work-related earnings (minimum and maximum).

See 1.1.2.c)

  • Financing: indicate the source of funds, describing, if that is the case, the structure of the funds according to their origin (i.e. X% from the state, Y% from employees, W% from the employers’ organisation, Z% from other, etc.).

The table below shows the structure of the fund according their origin. However, this represents the fund structure of the National Social Security. This is a more general perspective of the funding of the unemployment benefits. (More precise details do not exist/were not found)

Table 2
 

in millions of € (2010)

% of social Security financing (2010)

From the employees and employers

51470

59,1%

From the state

21119

24,2%

Alternative Financing

14066

16,1%

VAT

12422

14,6%

Withholding tax

464

0,6%

Tax on Tobacco

789

0,9%

Others

537

0,6%

Source: SPF Sécurité Sociale

  • SP involvement: Yes/No. If Yes, specify briefly:
  1. Who are the organisations involved and at which level do they operate? (E.g. trade unions, sectoral or national confederations, etc.)

In this system, the social partners have important role. They discuss every point in the management committee of National Office for Employment” (Office National de l’Emploi / Rijksdienst voor Arbeidsvoorziening - Onem/RSZ) in a bipartite way. In addition, unions also play the role of unemployment insurance fund. It also exists a more neutral fund, the “Auxiliary Unemployment Benefits Fund (Caisse Auxilliaire de paiement des allocations de chômage/ Hulpkas Voor Werkloosheidsuitkeringen - CAPAC/HVW).

  1. Why are these organisations involved (legitimacy)? Is it because they are representative?

The union’s participation on this kind of fund has an historical explanation. At the beginning (1890), unions have created funds to help workers. Over the decade, this competency stayed on their field.

1.2.2. Unemployment Assistance. Are forms of UA present? If yes, please indicate their general characteristics with specific attention to:

The Unemployment Assistance does not exist in Belgium.

  • Coverage:
  • Eligibility:
  • Duration:
  • Replacement rates:
  • Financing:
  • SP involvement: Yes/No. If Yes, specify briefly:
  1. Who are the organisations involved and at which level do they operate? (E.g. trade unions, sectoral or national confederations, etc.)
  1. Why are these organisations involved (legitimacy)? Is it because they are representative?

1.2.3. Social Assistance. Are SA programmes with a direct relationship with the UB system and/or SP involvement present? If yes, please highlight the factors underlying such a relationship.

The social assistance programmes do not have a direct relationship with the unemployment benefit system. Even if, people who ask for assistance, sometimes perceived an unemployment insurance. Social partners do not have a special involvement in these programmes. Indeed, it is quite more a political issue. But some people could say that there might be an ideological link between unions and political party, an informal one. But this is not proved.

2. SP involvement in the UB regime

In Belgium, the social partner’s involvement in unemployment benefit regime is undeniable. Within the “National Office for Employment” (Office National de l’Emploi / Rijksdienst voor Arbeidsvoorziening - Onem/RSZ), there is a management committee. This is composed in a bipartite way between unions representative and employers organization as follows:

For employer’s organizations:

For unions :

Also, we can find in these committee different representatives from ministry as such a member of the Ministry of Employment (Service Public Federal Emploi, Travail et Concertation Sociale/Federale Overheidsdienst Wergelegenheid, Arbeid en Sociaal Overleg) and the Ministry of Treasury (Service Public Federal Finances/ Federale Overheidsdienst Financien). All of these members are concerned in different phases in the unemployment benefit regimes as, development, implementation, management and monitoring.

Within the development phase, different scenarios are possible. The most popular one is the official demand from a Ministry to the committee to give an opinion/advice about a future ministerial or regal decree. In this case, a discussion between social partners begins to find an agreement about the position to give to authorities. Another scenario is the demand of one of the committee’s members to discuss a specific point. Finally, a last one possibility is that a governmental agreement has to be transposed in public institutions. This was the case of the unemployment reform. Indeed, social partners will discuss about the transposition of the governmental agreement from December 2011 in the National Office for Employment (Office National de l’Emploi / Rijksdienst voor Arbeidsvoorziening - Onem/RSZ). At this level, the involvement is more episodic. It depends on the needs. However, the committee works only on national matters.

Within the implementation phase, when a decision is made by the committee, authorities and/or institutions implement the content. There is no specific involvement by the social partner in this case, except for fine-tuning a specific point. However, this is considered as an intervention from the committee and not as social partners’ one. There is only one specific involvement of unions in the implementation phases; it concerns the unemployment insurance fund. Unions are in charge of the payment for people who are affiliated. This finds a historical and ideological explanation in the affiliation to a trade union, because the amounts of benefits paid are the same for every union. Just an exception is the Auxiliary Unemployment Benefits Fund which is not a trade union.

In many cases of this phase, the involvement of the social partners is more an advisory and a voluntary presence.

The unemployment assistance does not exist in Belgium.

Within the management phase; the place of social partners is important. Even though, the real involvement is quite limited. The committee is a specific public body dedicated to the unemployment benefit programmes. However, it cannot be considered as a self-governing board as it is limited by governmental measures, decrees, laws and national budgets. The decisions/advices made are transposed (by authorities) in many institutional and legal ways, but not from the committee. This means that the committee does not take the input’s decision but it has to discuss and/or implement the decision. The main goal of the committee in this phase is to offer the best possibilities to develop their decisions/advices. This means that the decisions/advices should be sufficiently large to be extended to any institutions, organizations, etc. Nevertheless, it seems that the financial reforms are more restrictive in Belgium and it could be affected the way to the social partners operate. Indeed, some governmental decisions (as the unemployment reform) do not offer the possibility to the social partners to discuss the point. In this case, they just implement the decision.

Almost that, the committee have to establish budgets and annual financial’ statements. In addition, the committee has an administration contract, and thus they have to follow the guidelines of these contracts but they also have to approve or not projects and discuss with the government official about the annual evaluation. Also, the Committee has to fix the personnel’s programme.

What concerns the payment of unemployment insurance, unions and the Auxiliary Unemployment Benefits Fund (Caisse Auxilliaire de paiement des allocations de chômage/ Hulpkas Voor Werkloosheidsuitkeringen - CAPAC/HVW), their competencies are explained within some regal decrees (as Regal Decrees of 25th and 26th November 1991). Those decrees were discussed with the committee before that the Secretary propose the text to be accepted and became compulsory.

The unemployment assistance does not exist in Belgium.

Nevertheless, in this phase as for the first three ones, social partners have an important part in training. This is not directly related to the National Office for Employment (Office National de l’Emploi / Rijksdienst voor Arbeidsvoorziening - Onem/RSZ). Indeed, this is at regional level with which are manage in a bipartite way as for the national level. Among the three regions:

Within the monitoring phase; the committee checks if measures token and decisions made have been accomplished. Also, they follow with attention the place of advices they have given to authorities. As any public administration, the committee has to check the different budgets in their field. Also, the “Court of Audit” (Court des Comptes/ Rekenhof) revised every year if budgets were well-managed.

Outside the committee, the social partners do not have any official roles. Except for the payment of benefits. Nevertheless, they can “play” an opposition role as for this unemployment reform. In this case, some strikes leaded by trade unions took place and social partners were omnipresent within the public debate (on TV-shows, radio, etc.)

3. Final observations

3.1. Public debates and policy discussion:

Please report SP’ and governments’ opinions and views on perceived consequences and implications of this involvement, suggesting insights on its further transformations. In so doing, the stress needs to be put on contents directly linked with on-going policy debates. Direct references to actors' voice will be certainly appreciated.

The role of social partners is important inside and outside the committee. As it said, the governmental agreement was applied within the National Social Security (Sécurité Sociale /Socialezekerheid). This unemployment reforms have some consequences such as:

The social partners have an important role within the committee to apply all of these measures. Also the role of unions out of the committee is essential. Indeed, before and after that the agreement was signed, unions have already shown their annoyance about the measures.

3.2. Research

Please make a list of academic contributions treating SP involvement in the UB regime of your country. If this specific topic does not apply to your country, alternatively, present academic contributions and/or documents stating the official position of the SP regarding the existing UB, in terms of coverage, effectiveness, quality of the support, etc.

Among the huge number of Belgian authors who worked on this topic we can find:

  • CREPON, B., DEJEMEPPE M. and M. GURGAND (2006), "Counselling the unemployed: does it lower unemployment duration and recurrence?", submitted to the Journal of the European Economic Association.
  • FELTESSE P., REMAN P., Comprendre la sécurité sociale pour la défendre face à l’état social actif, Fondation Travail-Université, Couleur livres, Bruxelles, 2006
  • VANDERLINDEN B., COCKX B., DEJEMEPPE M., Le Plan d’Accompagnement et de Suivi des chômeurs favorise-t-il l’insertion en emploi ?, Regards économiques, 49, IRES, U.C.L., 2007
  • VIELLE P., POCHET P., CASSIERS I., L’état social actif. Vers un changement de paradigme ?,2ème édition, Travail et Société, Vol. 44, Peter Lang, Bruxelles, 2006

4. Commentary

The involvement of social partners in unemployment benefit regimes is undeniable. However, the participation within the committee gives them a paradoxical position. Even if they have the possibility to discuss some points, some other ones just have to be implied. Sometimes, these points are against their ideological points of view as for this unemployment reform in one hand, the most important strength is the position within all employment public administrations. They have a space to discuss, negotiate and also, they have all the information they need. In the other hand, the most important weakness is the paradoxical position within the committee. For instance, some unions’ representative could, one day, discuss a point to imply it on the process of the National Office for Employment (Office National de l’Emploi / Rijksdienst voor Arbeidsvoorziening - Onem/RSZ). And the day after, being in the street to support a strike against the measures implied, as for this unemployment reform. This made a lot of noise within the social and political fields and some other strikes could take place…

Michel Ajzen - Institut des Sciences du Travail - UCL

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