Immigration
Beware or be chained – new Flemish chain liability legislation comes into force in January 2025
Summary
In December last year, the Flemish Council of Ministers approved a preliminary draft decree proposing an increased duty of care when working with (sub)contractors. As a result, it will no longer be possible to easily contractually exclude liability for illegal employment by the direct (sub)contractors. Up to now, it was still unclear when this legislation would enter into force as this was made dependent on a ministerial decision foreseeing the practical implementation. Just before the elections of last weekend, the ministerial decision was published in the Belgian gazette. As of 2025, contractors (not the ultimate clients) could be obliged to carry out specific checks when working with subcontractors. Beware of be chained!
The detail
Slipping through the meshes of the net
The law of 30 April 1999 on the employment of foreign workers and the decree of 30 April 2004 lays down some very specific obligations for companies working with subcontractors. For example, a contractor can be fined between EUR 600 and EUR 6000 and imprisoned for up to six months if he works with a subcontractor who has not checked beforehand whether a foreign employee has a valid residence permit or who has not kept a copy of this permit or authorisation for the duration of the employment in Belgium. This liability is deviant from the liability for ‘ultimate clients’, who only can be sanctioned if they are aware of the illegal employment by their subcontractor.
However, currently, there is still an important exception. If the contractor (not the ultimate client) is in possession of a written declaration from the subcontractor confirming that the subcontractor will not employ employees (third-country nationals) who do not have a valid residence permit, the contractor will not be sanctioned. This exemption does not apply if it can be proved that the contractor had knowledge of the infringement. Consequently, the chain liability can easily be shortened at present by providing for such a declaration.
Curtailing the meshes of the net
By introducing the decree amending the law of 30 April 1999 on the employment of foreign workers, the decree on social supervision of 30 April 2004 and the decree of 22 December 2017 containing a premium to encourage the transition of job seekers to entrepreneurship, the Flemish Parliament wanted to straighten out the chain liability and thus ‘curtailing the meshes of the net’ by making it more difficult for contractors to escape their liability.
The new decree foresees an increase in the duty of care of contractors (not ultimate clients). When awarding contracts, the exemption will only apply if (i) the contractor is in possession of a written declaration from the direct subcontractor stating that the latter has not employed illegally staying third- country nationals and (ii) the contractor has acted with the necessary diligence to prevent the direct subcontractor from employing illegally staying third-country nationals. Such due diligence means that the contractor must ask for (and receive) specific information on the identification of the subcontractor and its employees (e.g. their personal data and information on their residence status and residence permit).
The entrance into force of the articles related to chain liability in the Flemish decree, was made dependent on the draft of a ministerial decision. This ministerial decision was published in the Belgian Gazette on 4 June 2024 and foresees an entry into force of the Flemish Decree as of 1 January 2025.
Ambitious initial checklist chained by GDPR
Now the ministerial decision has been published, a final list of documents that should be kept available by the contractor with regard to the (employees of) the subcontractor has been published. Important in this respect is that – although the initial ideas were very ambitious, the ultimate checklist seems to be rather limited. For example, in preparation of the ministerial decision, judicial advice had been sought with regard to the inclusion of employment contracts to this list. The obligation to keep a copy of the employment contract available has not made the list, as it would not be considered as ‘proportional’ in the context of GDPR legislation.
According to the ministerial decision, a distinction should be made between employees (and self- employed) for whom the ‘Van der Elst’ exemption is applied and all other non-EEA nationals.
The Van der Elst exemption is a temporary exemption to the obligation to have a Belgian work permit, for employees (and self-employed) temporarily seconded to Belgium and legally residing for more than three months in another country of the EEA and Switzerland.
For employees (and self-employed) for whom a Van der Elst exemption is applied, the contractor should ask for a copy of the passport, a copy of the residence permit, a copy of the Limosa and a copy of the A1 document. It concerns the documents necessary to prove the fulfillment of the conditions to apply a Van der Elst exemption according to the case law of the European Court of Justice. If no A1 document has been provided yet, it is sufficient to have a proof of application.
For all other employed (and self-employed) nationals of non-EEA countries or Switzerland, the contractor should ask for a copy of the passport, a copy of the residence permit, a copy of the work permit and (if applicable) a copy of the DIMONA declaration.
If a contractor does not receive the necessary information, he must explicitly ask the subcontractor for it again. If he still does not receive it, he will be obliged to inform the social inspectorate. A contractor who does not perform the necessary checks by taking into account the necessary duty of care (and thus by not contacting the social inspectorate in case of non-compliance), might face the sanctions as described above.
How can we help you to unleash the chain?
Although employing non-EEA nationals in Belgium might already be complex, working with non-EEA national contractors (or non-EEA national employees of contractors) might be extremely complex. Vialto Partners can assist you in ensuring compliance with Belgian legislation, by reviewing your internal processes, drafting contracts and providing all kind of guidance for compliance teams. If you want to ensure that you unleash your chain (liability), feel free to reach out to us!
Contact us
For a deeper discussion on the above, please reach out to your Vialto Partners point of contact, or alternatively:
Bart Elias
Partner
Martijn De Meulemeester
Director
Marij Notelteirs
Senior Associate
Further information on Vialto Partners can be found here: www.vialtopartners.com
Vialto Partners (“Vialto”) refers to wholly owned subsidiaries of CD&R Galaxy UK OpCo Limited as well as the other members of the Vialto Partners global network. The information contained in this document is for general guidance on matters of interest only. Vialto is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will Vialto, its related entities, or the agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this document or for any consequential, special or similar damages, even if advised of the possibility of such damages.
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Further information on Vialto Partners can be found here: www.vialtopartners.com
Vialto Partners (“Vialto”) refers to wholly owned subsidiaries of CD&R Galaxy UK OpCo Limited as well as the other members of the Vialto Partners global network. The information contained in this document is for general guidance on matters of interest only. Vialto is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will Vialto, its related entities, or the agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this document or for any consequential, special or similar damages, even if advised of the possibility of such damages.
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