Be Aware – January 2025

New information obligation when transferring an undertaking

In case of a transfer of undertaking, the Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the member states relating to the safeguarding of employees' rights in the event of transfers of undertakings, businesses or parts of undertakings or businesses. requires the staff representatives to be informed of:

• the date or proposed date of the transfer;
• the reasons for the transfer;
• the legal, economic and social implications of the transfer for the employees; and
• any measures envisaged in relation to the employees (eg redundancies, a relocation to the premises of the transferee).

If there are no staff representatives in the company involved, this information must be provided to the transferring workers themselves.

This Directive is implemented into Belgian law by means of the collective bargaining agreement n° 9 consolidating the national agreements and the collective bargaining agreements concerning the works councils and the collective bargaining agreement n° 32bis.

When it comes to the implications of the transfer, a practical problem can arise. The transferor should inform the staff representatives on this topic before the transfer, but those implications mainly depend on the intentions of the transferee concerning the period after the transfer. So there might be cases where the transferor doesn't have sufficient information on the plans of the transferee and wherend the transferor can only point out that the transferee will – immediately after the transfer – have to respect all obligations as they exist immediately before the transfer.

In a communication of 17 December 2019, the Belgian National Labour Council stated there should be some form of cooperation duty between the transferor and the transferee to ensure the quality of the information the transferor can share with its staff representatives.

On 17 December 2024, the National Labour Council signed a new collective bargaining agreement, completing the existing collective bargaining agreement n° 32bis on this topic.

A new article 15/2 added to this collective bargaining agreement n° 32bis stipulates that, at the request of the staff representatives of the workers to be transferred, the transferor should provide the transferee with the information the transferor shared with the staff representatives and the transferor should invite the transferee to present themself to these staff representatives.

The new collective bargaining agreement only very partially regulates this sharing of information.

In the first place it only states the staff representatives can require the transferor to invite the transferee for a presentation. It doesn't expressly state the transferee is obliged to accept this invitation.

If the transferee does, the collective bargaining agreement merely refers to the transferee giving a presentation. It's up to the transferee to decide on the content of the presentation, as the collective bargaining agreement doesn't include a list of points to be discussed in the presentation.

When it comes to the timing, the collective bargaining agreement states the information should be provided to the transferor "in a timely manner," but in any event before the transfer. If the transferee agrees to give a presentation, it's up to the staff representatives and the transferee to agree when this presentation will take place.

The amended collective bargaining agreement n° 32bis doesn't address the other point where a lack of the transferor and the transferee sharing information can be problematic. The transferee has to respect all rights and duties under the employment contract of the transferred workers as they exist at the moment of the transfer. But collective bargaining agreement n° 32bis doesn't stipulate a procedure whereby the transferor informs the transferee about what these rights and obligations are. The parties should preferably regulate this information sharing on a contractual basis.

In some joint committees – notably the joint committee for the cleaning sector – there's a collective bargaining agreement at the level of the joint committee stipulating an information sharing procedure so the transferee is informed about the existing rights and duties.

 

Implied employment contracts in illegal labour leasing

The Belgian Act of 24 July 1987 concerning temporary work, temp agency work and putting workers at the disposal of third parties prohibits labour leasing.

Labour leasing is when workers of company A (the "official" employer) work for company B (the user or "in practice" employer), and company B would even partially exercise the employer's authority on those workers. The Act does stipulate some exceptions where labour leasing is allowed.

If the prohibition on labour leasing is infringed, criminal sanctions can be imposed on both the employer, the user and the physical persons with the relevant decision-making power in both the employer and the user.

The Act of 24 July 1987 also stipulates civil sanctions for infringing the prohibition on labour leasing.

The Act stipulates the worker involved is deemed to have an employment contract of undefined duration with the user. A Supreme Court judgement of 23 December 2024 clarified the consequences this presumption can have.

A worker was recruited in 2007 to be "leased" to another company. This structure ended in 2016. The worker claimed the payment of an indemnity in lieu of notice and an indemnity for manifestly unreasonable dismissal from the user. In a judgement of 22 March 2021, the Employment Appeal Tribunal of Mons considered these claims unfounded. The argument was that an indemnity in lieu of notice can only be due if the employer terminated the employment contract. The user had in the case at hand always denied being the employer in the first place, so by definition never expressly dismissed the worker. It argued the contract with the "official" employer would be the only employment contract that exists.

The Supreme Court reversed this decision in its judgement of 23 December 2024. The Supreme Court considered that the Act of 24 July 1987 stipulates the worker is deemed to have an employment contract with the user in case of a violation of the prohibition on labour leasing. This is a separate employment contract, which – from a legal point of view – is completely independent from the employment contract with the "official" employer.

This independence of the two contractual relationships means – according to the Supreme Court – the worker can say the implied contract with the user was terminated by the user if the labour leasing ends and the user no longer provides work. The contractual violation of no longer providing work is considered sufficient to allow the worker to invoke implied dismissal. In this respect, it doesn't matter that the user never intended to have or end a contractual relationship with the worker involved. The Supreme Court considered the worker could claim the payment of an indemnity in lieu of notice from the user.

The independence of the two contractual relationships also means the fate of the employment contract with the "official" employer is irrelevant if there's a violation of the prohibition on labour leasing and the worker brings claims against the user. The worker can claim an indemnity in lieu of notice from the user, even when they would remain in service of the "official" employer.

Similarly, if the "official" employer terminates the employment contract by paying an indemnity in lieu of notice, the Employment Tribunal cannot "deduct" this indemnity in lieu of notice if the worker claims an indemnity in lieu of notice from the user.

We should add that this scenario of the worker bringing claims against the user assumes the worker can establish there was an infringement of the prohibition on labour leasing. As the plaintiff, the worker bears the burden of proof for establishing this infringement.