A recent judgment of the Court of Cassation of 22 June 2026 confirms that a company can be made to pay its director's unpaid self-employed social security contributions for periods coinciding with their mandate, even where those debts stem from an activity that has nothing to do with the company.
What the Court decided
The case concerned an individual who held an unremunerated directorship in a Belgian company. Fully separately, that same person carried on a self-employed activity as an IT consultant and business coach. When the individual’s self-employed social security contributions went unpaid, their social insurance fund turned to the company to recover the arrears.
The ensuing dispute ended before court, with the Brussels Labour Court finding that the company was jointly and severally liable for the whole of the contributions owed by the individual for the period during which they were director, including contributions relating to their separate independent activity.
Following the Labour Court’s reasoning, the Court of Cassation equally rejected the company’s appeal in cassation. After examining article 15 of Royal Decree no. 38 – which states that legal entities are jointly and severally liable for the self-employed social security contributions owed by their shareholders and mandataries – it found that the provision doesn’t otherwise limit the effects of the joint liability it creates. As such, a company is jointly liable for all social security contributions its director owes during their mandate, even if they relate to a separate independent activity without any link to the company.
Building on settled case law
The ruling extends a line of authority that was already well established, although the earlier decisions concerned directorships held across several different companies rather than a wholly separate self-employed activity. As long ago as 1988, the Court of Cassation held that, where a person is a director in several different companies, each of those companies is liable for that director's full outstanding social security debt instead of them being divided proportionally. In 2014, the Constitutional Court confirmed that this principle does not breach the constitutional guarantees of equality and non-discrimination and that the measure is proportionate because it applies only for the actual duration of the mandate.
A capped but genuine exposure
A company’s financial exposure because of this joint liability isn’t unlimited, seeing as social security contributions for self-employed individuals are capped at roughly €20,000/year with a five-year prescription period. Even so, the joint liability can result in a sizable bill for the company and can therefore have a very real impact, certainly on smaller and medium-sized companies and on associations. Crucially, the exposure can arise even where the directorship is unremunerated, as it was in this case.
Key takeaways for organisations
The practical lesson is that a company's liability can be triggered by activities it may know nothing about, so awareness is the first line of defence. As a matter of good practice, organisations should make sure they know whether their directors and other mandate holders carry on any self-employed activity of their own, for example by writing an information obligation into the terms and conditions. Educating your directors on their social security obligations can be the second line and it could also be sensible to ask directors to hand over, on a periodic basis, a certificate from their social security fund confirming that they have no outstanding social security debts.
A further protection is to include a liability guarantee in the director’s terms and conditions, requiring them to warrant that their social security contributions are paid and to reimburse the company for any amounts paid under the joint liability.
Together, these measures give organisations early sight of a risk that would otherwise remain hidden until a demand for payment arrives and a contractual route to recover the amounts paid.
If you’d welcome a closer look at how this ruling affects you or would like assistance in drafting suitable protections into your directors' terms and conditions, don’t hesitate to reach out to PwC Legal; PwC Legal would love to hear from you.
Authors:
- Pascale Moreau, Lawyer - Partner at PwC Legal
