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Company level social dialogue in times of restructuring: news from Belgium

  • Social partners recently confirmed the joint recommendations signed in December 2019 on collective dismissals and agreed to assess their content again within three years
  • The Government communicated its desire to evaluate an improvement of the entire system, thus overriding the social dialogue outcome.

Through recommendation N. 28 of 17 December 2019, Belgian social partners, in the framework of the National Labour Council (Conseil National du Travail – CNT in French), elaborated joint recommendations for trade unions and employers or employers’ representatives to improve the procedures of companies’ restructuring. They also adopted “advice” N. 2184 on 27 October 2020, to agree on the need to centralise all legislation related to restructuring and facilitate the exchange of information between workers, employers and public authorities through a government’s one stop service.

Such joint recommendations dealt with a topic that had not been in the social dialogue agenda for the preceding 20 years.

Recently, such a debate has resurfaced after the Covid-19 related social and economic crisis leading to a number of reorganisations entailing collective dismissals. The Ministry of Labour thus declared its wish to change the current legal framework for collective dismissals and to introduce a publicly financed social action plan.

The Ministry of Labour declaration is at odds with the 2019 joint recommendations that already established the obligation to:

  • set a timeframe for the information and consultation phase between the management and the trade unions, so as to avoid inefficiencies and delays;
  • inform the subcontracted companies or workers which activities would be compromised following the restructuring.

According to the Federation of Enterprises in Belgium (FEB), recommendation N.28, together with the legal framework (mainly the Law on provisions in favour of employment of 1998, the so-called “Loi Renault”), provide a good structure for effective dialogue prior to a collective dismissal procedure. In the Guide “Company restructuring, with or without dismissals” FEB put together some guidance and practical advice on the action plan to be implemented in case of restructuring. According to the Guide “company restructuring is not necessarily implying a personnel reduction but also derive in a company transformation to help the company thrive in the future. It could also entail a reorganisation of work, or other changes”.

In addition, the social partners agreed also to review the joint recommendations in October 2023 and within the CNT.

Thus, the government proposal is overriding the social partners views and agreement on this topic.

In February 2021 Jean-Charles Parizel, Adviser at FEB, commented the government’s initiative as follows “as stressed during parliamentary debates, the top priority is maintaining employment (in general) and reviving economic activity. These objectives require effective forward-looking dialogue which focuses on the employability of workers and their future prospects in the labour market. To impose on companies, whatever their size, the financing of a social plan does not meet this objective of maintaining employment, stimulating economic activity and professional reintegration. It is only a one-off payment of a sum of money which does not guarantee a never-ending employment. Worse, the compulsory nature of such a plan could accelerate the closure of companies unable to simultaneously finance a social plan and a project of economic recovery, for instance SMEs”.