Belgium: Antwerp Labour Tribunal Ruling: Wage Norm Prohibits Wage Increase Due to Collective Reduction of Working Time

On 13 June 2024, the Antwerp labour tribunal issued a ruling that reflects a new view of how employers can use the wage norm as a powerful instrument to resist sector-imposed (indirect) wage increases.

The employer in question is a Belgian company that provides household and other personal services using service vouchers. The employer pays its employees by the hour.

In the last few years, the joint committee of which the employer is part (322.01 for service voucher companies) gradually reduced weekly working time, namely from 38 to 37 hours in 2015, from 37 to 36 hours in 2017 and from 36 to 35 hours in 2020. These changes were implemented within the company by modifying the company’s labour regulations rather than by collective bargaining agreements. This allowed the employer to avoid the application of article 28, §1 of the Belgian Labour Act which prohibits employers from reducing wages when working time is reduced. Consequently, the hourly wages were not modified to match the reduction in weekly working time. This means that the total wage of the employees was reduced (as they worked less hours).

The wage norm is a Belgian national framework that determines by how much wages can increase during a period of 2 years. It considers the growth of the economy and price fluctuations (inflation or deflation). The wage norm aims to keep wages fair and sustainable, allowing businesses to compensate their employees appropriately without adversely impacting the economy.

On 22 April 2020, the joint committee concluded a collective bargaining agreement that provided for a wage increase of 0.8% starting 1 January 2020, which falls within the limits of that period’s wage norm of 1.1%.

The CBA of 22 April 2020 also provided that minimum wages must be adjusted in the event of collective reductions in working time. This CBA was declared universally binding, meaning that it applies to all employers and employees of the sector, including those who were not parties to the CBA. In June 2022, a new CBA was concluded, providing a 0.4% wage increase effective 1 June 2022, which was again within the limits of the wage norm of 0.4% for that period. The previous CBA’s clause about adjustment of minimum wages was also included.

The employer argued that applying the wage adjustment from the sectoral CBA was in conflict with the wage norm and, thus did not implement the adjustment. This refusal was noted by the Belgian Social Laws Inspectorate, which prepared a report on the matter. The National Social Security Office subsequently regularized the difference between the reported wage and the adjusted wage.

An employee working part-time for this company demanded the application of the wage adjustment and payment of overdue wages, but the employer claimed that there was no obligation to pay due to conflicts with the wage norm. The employee took the case to court.

The Antwerp labour tribunal, in its decision of 13 June 2024, reiterated the rules regarding the hierarchy of obligations in labour relations, laid down in the Collective Bargaining Agreements Act. It ruled that if the employer can demonstrate that applying the wage adjustment in accordance with the sector CBA (lower in hierarchy) is in conflict with the wage norm, which derives from an act (higher in hierarchy), that provision of the CBA is relatively null and void.

The tribunal calculated that the adjustment of the wages in accordance with the reduction of working time implied an increase in gross wages of more than 8%, which would exceed the available wage margin of 0.4%. In other words, the tribunal rejected the employee’s claim.

To conclude, the Antwerp labour tribunal ruled that employees’ hourly wage must not be increased when weekly working time is collectively reduced, if this increase would exceed the wage norm. This decision has great consequences for employees facing working time reductions, as it means that their weekly wages can be lower after the working time reduction. This decision is also one of the very few known cases in which an employer has successfully disobeyed a sector CBA based on the wage norm.

Source: Arbrb. Antwerpen 13 juni 2024, 23/289/A, onuitg.