Stricter rules for joint and several liability for salary debts in the construction sector. Was your (sub)contracting agreement already adapted?

In an earlier newsflash we discussed the preliminary draft law relating to various provisions concerning the posting of employees. This law was published on 20 December 2016 in the Belgian Official Journal and then entered into effect on 30 December 2016.

This law provides for a substantial expansion of the joint and several liability for salary debts of the direct contractor, in the case of activities in the construction sector.

Up to now it was the case that principals, contractors or subcontractors could only be held jointly and severally liable for the salary debts of a (sub)contractor, as soon as they were at least informed thereof by a notification from the social inspection services. The joint and several liability then only kicked in after 14 working days, and also applied only for future salary debts.

That system is now being thoroughly modified – at least for the construction sector.

From now on, the principal or contractor who calls upon a (sub)contractor who does not pay the applicable Belgian minimum wages, automatically becomes jointly and severally liable for the part of the salary that wasn’t paid and that corresponds to the works that are performed for this principal or contractor.

It concerns an automatic joint and several liability vis-à-vis the direct co-contractor, which does not apply for further subcontractors in the chain.

This automatic joint and several liability finds no application if the principal or contractor possesses a written declaration signed by both parties, in which:

• the principal or contractor communicates to his (sub)contractor the coordinates of the internet site of the FPS Employment, Labour and Social Dialogue in which the information concerning the owed salary is contained (www.minimumlonen.be); and
• the (sub)contractor of the principal or contractor confirms that he is paying and will pay the owed salary to the employees of this contractor.

No transitional arrangement is provided for, as a result of which the expansion of the mechanism of joint and several liability applies to all current contracting agreements.

Most of these (sub)contracting agreements will provide for an obligation to pay the Belgian minimum wages, but the reference to the federal website may not be included.

Thus you would do well to examine your (sub)contracting agreements and to provide for a clause - or to have your (sub)contractor sign an extra declaration - that satisfies this new legislation.  

For more information on this topic, you can consult Sébastien van Damme (author) and Sara Cockx (author and unit head).