Reducing working time as anti-crisis measure

In April 2009, the Belgian government and social partners finally agreed on a crisis scheme for white-collar workers. Although the scheme has not been labelled ‘temporary unemployment’, the three measures adopted allow for a crisis-related reduction in working hours, a crisis time credit system and collective suspension from work. The first measure is available to all companies, while the other two can only be implemented by companies in financial difficulties.

On 30 April 2009, the Council of Ministers has adopted an Act on some new measures to protect employment in light of the economic crisis. The measures offer companies more possibilities to temporarily reduce employees’ working time in order to avoid as many layoffs as possible during the current crisis. These measures will be effective from 1 July until 31 December 2009, with the possibility of an extension until 30 June 2010, depending on the development of the economic situation and after the National Labour Council (Nationaal Arbeidsraad/Conseil National du Travail, NAR/CNT) has put forward its opinion on the issue.

Provisions of anti-crisis measures for white-collar workers

After the social partners failed to reach agreement on extending the temporary unemployment rules that had been put in place for blue-collar workers to white-collar workers (BE0904019I), the Vice-Prime Minister and Minister for Labour and Equal Opportunities, Joëlle Milquet, proposed the following three measures:

  • temporary collective reduction of working time;
  • temporary individual reduction of working time;
  • temporary or economic unemployment (tijdelijke werkloosheid/chômage technique) for employees, including white-collar workers.

The second and third measures are only available to companies which qualify as being in financial difficulties: that is, if a company’s turnover has decreased by 20% or when 20% of the company’s workforce is temporarily unemployed.

The following table outlines the main features of the three anti-crisis employment measures.

Overview of anti-crisis employment measures
  Temporary collective reduction of working time Temporary individual reduction of working time Temporary unemployment
Measure Reduction in working time by one fifth or a quarter Based on existing time credit scheme (BE0108360F) – parties decide to reduce working time by mutual agreement Collective, total or partial suspension of employment contract
Conditions For all employees or a specific category of employees Company in financial difficulties Working time reduction by one fifth or half for a minimum period of one month and up to a maximum period of six months Normal conditions of the time credit scheme do not apply – temporary reduction of working time is not considered an employee’s right in this case Applicable to full-time employees only Company in financial difficulties White-collar workers (measure already exists for blue-collar workers) Applicable to a certain number of employees and only after exhausting their recuperation days Total (during all days of the week) or partial (at least keeping two working days a week) suspension of employment contract for a period of at least one or two weeks and up to a maximum of 16 or 26 weeks a year
Procedure Company collective agreement Consent required by employee in the form of an agreement between the worker and the employer Collective agreement at sectoral level before 1 June 2009; if none exists, collective agreement at company level or a company plan approved by an ad hoc commission (the latter must contain measures for maintaining a maximum level of employment) Several further technical conditions Collective agreement at sectoral level before 1 June 2009; if none exists, company collective agreement or company plan approved by an ad hoc commission – both must provide information on the employment level maintained, the duration of suspension and the fee to be paid by the employer Unemployment Office and employee must be informed seven days prior to implementation
Employee compensation Monthly compensation paid by the employer for reduced wages in the case of working time reduction: - by one fifth – a minimum of €150 - by a quarter – minimum of €187.50 Limit: the wage and compensation combined must remain below the employee’s last full-time wage These amounts are increased by €100 if a four-day working week is implemented Allowance paid by the National Employment Office (Rijksdienst voor Arbeidsvoorziening/Office National de l’Emploi, RVA/ONEM) Working time reduction: - by one fifth – €188 (€248 when the worker is aged 50 years or over) - by half – €442 The employer can pay an additional compensation; however, this is not compulsory Limit: the wage and allowance combined must remain below the employee’s last full-time wage Compensation paid by the Auxiliary Unemployment Benefits Fund (Caisse auxiliaire de paiement des allocations de chômage/Hulpkas Voor Werkloosheidsuitkeringen, CAPAC/HVW) for each day of suspension amounting to: - 70% if cohabiting - 75% if single or main family breadwinner) of the worker’s gross wage which is limited to a maximum of €2,206 a month The employer can pay an additional compensation that is equal to the compensation granted by an employer to workers receiving unemployment benefits in the case of a total suspension of an employment contract due to economic difficulties
Employer benefit During working time reduction, the employer benefits from a reduction in social security contributions: - by €600 a quarter if working time is reduced by one fifth - by €750 a quarter if working time is reduced by a quarter These amounts are increased by €400 if a four-day working week is implemented

Source: Minister for Labour and Equal Opportunities, Press statement of 28 May 2009

Reaction of social partners

Employers have responded with relief to the anti-crisis employment measures for white-collar workers, while the trade unions hope that these measures will prevent dismissals. The trade unions representing white-collar workers have succeeded in maintaining the white-collar worker statute. Furthermore, they obtained the guarantee that the measures can only be prolonged until 2010, when the highest rise in unemployment is expected and when the additional costs for the budget of RVA/ONEM can clearly be assessed. It is also expected that, by 2010, progress will have been made in the harmonisation of the Belgian employment statutes of blue-collar and white-collar workers.

Guy Van Gyes, Higher Institute of Labour Studies (HIVA), Catholic University of Leuven (KUL)

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