On 6 April 2023, the social partners, represented in the Group of 10, concluded an Interprofessional Agreement on a number of measures concerning minimum wages, supplementary pensions, flexibility, end of career and the extension of current records. The Law of 31 July 2023, published in the Belgian State Journal on 5 September 2023, implements some of the agreed measures, in particular relance hours and innovation premiums. Both measures are not new, but we refresh the main points of interest here.
Reintroduction of relance hours
During the COVID pandemic, the government made it possible for essential sectors to perform 120 additional voluntary overtime hours, called relance hours.
This measure was extended by the IPA 2021−2022 to all sectors and was applicable until 31 December 2022. As from 1 January 2023, companies could no longer make use of these relance hours.
However, IPA 2023−2024 reintroduces these relance hours as from 1 July 2023.
Specifically, this means that as from 1 July 2023, employees will again be able to work 220 voluntary overtime hours, containing 100 voluntary overtime hours (basic quota) + 120 relance hours (additional quota) and this during each of the following periods:
- 1 July 2023 to 31 December 2023;
- 1 January 2024 to 31 December 2024;
- 1 January 2025 to 30 June 2025.
Relance hours are (para)fiscally very favourable:
- no overtime or compensatory rest due;
- they are exempted from social security contributions; and
- they are also exempted from income tax insofar as they are worked in the period from 1 July 2023 to 30 June 2025 and no conventional overtime is paid. The tax exemption disappears as soon as the employer pays an additional remuneration for the relance hours.
Hence, gross pay for these overtime hours can, in principle, be paid net.
It is also important that the employee must explicitly agree in writing − in advance − to perform relance hours. The agreement is valid for six months and can be renewed.
Extension of the innovation premium
An innovation premium is a premium paid by an employer to its creative employees for coming up with a new idea to be implemented within the company.
This premium can be granted to the employee free of social contributions and taxes provided that:
- it is granted for a novelty that represents genuine added value in relation to normal activities for the employer;
- the innovation is not the subject of a prior call for tenders or request for specifications for the purchase of products or processes addressed by a third party to the party granting the premium;
- the innovation is the subject of a prototype or an application for the manufacture of a prototype or there must be internal instructions indicating what changes the innovation will bring about in the company's normal operations;
- the premium is not granted to replace or convert salary;
- the premium is only granted to employees with an employment contract;
- the amount per employee does not exceed the employee's monthly gross remuneration per calendar year;
- the total amount of premiums paid for one calendar year does not exceed 1% of the wage bill of the company for that calendar year;
- it is awarded to a maximum of 10 employee per innovation project;
- the premium applies to a maximum of 10% of employees. In companies employing fewer than 30 employees, a maximum of 3 persons may receive the premium;
- the criteria, procedures and identification of the project within the company were disclosed as well as communicated to the Minister of Economy.
Employees can perform (para)fiscally favourable relance hours again as from 1 July 2023 to 30 June 2025. These hours are exempted from social security contributions and income tax. Gross therefore equals net. Just make sure you have a clearly expressed written agreement from the employee before the overtime is performed. Also make sure you do not pay conventional overtime for these hours to avoid them being taxed after all.
The possibility of granting the (para)fiscally favourable innovation premium was also extended. Here, it is important to follow the correct administrative steps before granting the premium.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.