Employing foreign workers on the Belgian territory: watch out as from 31 March!

On 1 June 2011, the federal government signed a cooperation agreement with the regions and communities on coordination of the controls on illegal employment and social security fraud. The Act of 1 March 2013 implementing this agreement will now come into force on 31 March 2013.

The aim of the Act is better, more efficient coordination between the different inspectorates (regional and federal) with the aim of cracking down on the illegal employment of foreign workers and social security fraud. Only recently, the government have further tightened up enforcement of the law on joint liability for wages, social security and income tax for employment of foreign nationals in Belgium (see Stefan Nerinckx, Employment of illegal aliens tightened up and secondment to Belgium: joint and several liability for wages, Expat News n°6, June 2012), loans of staff (e.g. new obligations for international secondments (HR Legal Focus of 10 January 2013), anti-abuse in respect of international social security (HR legal Focus of 29 January 2013), and so on.

To achieve more efficient coordination of inspections, the agreement includes active exchanges of information stored on various databases (work permits are issued regionally, residence permits at federal level, etc.), organisation of joint training, multi-skill audits/inspections, etc.

Permanent cooperation and the organisation and coordination of controls is organised under the leadership of the public (labour) prosecutor.

Employing foreign workers without legal residence

In the same context, the Act of 11 February 2013 setting down the sanctions and measures for employers of illegally resident third-country nationals came into force on 4 March 2013 (Belgian Official Gazette of 22 February 2013). The act is a partial transposition of Directive 2009/52/EC of the European Parliament and the Council, which forms part of the general campaign to combat illegal migration in the EU and encourage legal migration.

Below, we summarise the main points to watch out for from the act.

1. Obligations on employers

In general, the employer must examine up front whether an employee (a third-country national) is in possession of a valid residence permit the employer has to keep a copy of the residence permit available for inspection during the period of employment the employer must file a declaration/notification for commencement and termination of the third-country national worker's employment. This can be done via DIMONA/LIMOSA (we will be coming back in a following newsletter on the amended LIMOSA regulations stipulated in the RD of 19 March 2013, applicable as from 1 July 2013)

In addition, if the employer (Belgian-established or foreign) breaches the Foreign Workers Employment Act of 30 April 1999 by having work done or procuring work by a foreign national who is not permitted or authorised to stay for more than three months or to settle in Belgium, he is liable to pay:

  • salary equal to the salary he would have to pay a legally employed worker; this payment obligation extends to social security and taxes
  • the costs of repatriation
  • a lump sum for accommodation
  • residence and health care for the foreign worker and his family
  • penalties for late payment and administrative fines

Finally, an employee with no legal residence who is employed on the basis of an employment contract is deemed to have worked for at least three months unless there is evidence to the contrary. This means, in principle, that the wages for three months and any termination payment will be calculated on the basis of three months' employment.

2. Joint liability for outstanding wages

A contractor (outside or in the framework of a chain of subcontractor's liability) and subcontractor are jointly and severally liable for the wage that has not yet been paid to an employee with no legal residence. The same goes for taxes and social security.

The (sub-)contractor is not jointly and severally liable if he has a written statement from his direct subcontractor confirming that he does not employ any third-country nationals who have no legal residence. The (sub-)contractor will, however, be jointly and severally liable again once he is aware that his direct subcontractor is employing one or more third-country nationals without legal residence.

A principal who knows that his (sub)contractor employs workers without any legal residence permit is jointly and severally liable for the wage that has not yet been paid to an employee with no legal residence.

3. Criminal liability

On conviction, employing staff without being in possession of a work authorisation/permit carries a criminal fine of between 600 and 6,000 euros, or an administrative fine ranging between 300 and 3,000 euros multiplied by the number of illegally employed workers.

Employers can also incur criminal penalties inter alia for not first investigating the employee's residence permit (and keeping a copy of it available for the authorities) and for non-payment of wages for which they are jointly and severally liable. Employing staff without checking they are in possession of a residence card or - as an employer - not holding a copy carries a penalty against the employer of imprisonment of between 6 months and three years and a criminal fine of between 3,600 and 36,000 euros or an administrative fine ranging between 1,800 and 18,000 euros. The same goes for the mandatory, principal, main contractor or intermediate contractor where their subcontractor does not comply with the obligations to check and keep a copy of the employee's residence permit. The fines are multiplied by the number of employees concerned. In addition, the court can order a trading prohibition, block individuals from carrying on a certain occupation or order closure of a business.

Finally: the illegally staying employee can raise proceedings; other organisations can also take on the defence of illegally staying employees in court proceedings. These include employee and employer organisations, trade unions and the Equal Opportunities and Race Equality Centre.

So watch out as employer as not only the sanctions in employing illegally third country nationals are tightened but the control mechanisms become also much more efficient.