Remuneration ceilings: what are they and what
purpose do they serve?

March 2022 – The application of certain labour law provisions depends on the remuneration of the employees concerned and on certain remuneration ceilings. These salary ceilings are adjusted annually. The amounts referred to in this article are the amounts for 2022.

In which situations are earnings ceilings applied?

Remuneration ceilings are important for the application of the following clauses:

the non-competition clause: an employer can impose a non-competition clause on his employee in case he leaves the company. This clause is only valid if the employee's gross annual pay exceeds a certain minimum amount. Gross remuneration means the gross monthly remuneration multiplied by twelve, the double holiday allowance, the year-end bonus and all benefits;

the arbitration clause: the employer and the employee can agree that any disputes between them will not be settled before a judge, but by arbitration. Such an arbitration clause is only valid if the remuneration of the employee concerned exceeds a certain amount and if the employee is responsible for the day-to-day management of the company or if he/she is responsible for the management of a business unit which can be considered as an independent entity;

the schooling clause: this is a clause under which the employer can literally punish the employee if he or she leaves the company shortly after completing training at the employer's expense. A training clause does not apply to trades in short supply. Moreover, a training clause is only valid if the employee's pay exceeds a certain amount.

How high are the salary ceilings?

From 1 January 2022, a non-competition clause is only valid if the employee's gross annual pay exceeds 36 785 euros. If the gross annual remuneration is between 36 785 euros and 73 571 euros, the non-competition clause is only valid for the functions determined by a CLA. Above 73 571 euros, the opposite is true: the non-competition clause is valid, except for functions excluded by a CLA.

The above distinction does not apply in the case of a non-competition clause for a sales representative which is valid as soon as the gross annual remuneration exceeds 36 785 euros.

An arbitration clause is only valid if the employee's gross annual remuneration exceeds 73 571 euros.

Finally, a schooling clause is only valid if the employee's gross annual pay exceeds 36 785 euros.

Notice periods

The salary caps also played a role in the calculation of notice periods for employees. The calculation of notice periods has meanwhile become more complex since the single status came into force on 1 January 2014. For employees who were already employed by their current employer before 1 January 2014, the maximum pay limits applicable on 31 December 2013 are taken into account for the calculation of seniority up to 31 December 2013. These were 32 254 euros and 64 508 euros respectively.

Since 1 January 2014, the notice periods are therefore calculated on the basis of two elements:

where applicable, the first part is calculated on the basis of the seniority acquired until 31 December 2013 ;

the second part is based on the seniority acquired from 1 January 2014 until the date of notification of the notice period.

In the case of a notice period notified by the employer, the period is calculated as follows

for seniority up to and including 31 December 2013 :

• if the annual remuneration on 31 December 2013 was higher than 32 254 euros, the notice period is equal to one month per year of seniority started;

• otherwise, the notice period is equal to three months per five years of seniority;

for seniority as from 31 December 2013, the notice period is determined according to the table below. Therefore, no ceiling on remuneration is taken into account in the calculation of the notice period after 31 December 2013!

Length of service and notice period (in weeks):
0 to less than 3 months: 1
From 3 months to less than 4 months: 3
From 4 months to less than 5 months: 4
5 months to less than 6 months: 5
From 6 months to less than 9 months: 6
9 months to 24 months: + 1 week per 3 months
From 2 years to less than 3 years: 12
3 years to under 4 years: 13
4 years to under 19 years: + 3 weeks per year
From 19 years to under 20 years: 60
20 to under 21: 62; and
from 21 to under 22: 1 week per year.

In case of notice given by the worker, the following rules apply:

for seniority up to and including 31 December 2013 :

• if the annual remuneration on 31 December 2013 was more than 32 254 euros, the notice period is equal to one and a half months for every five years of seniority, with a maximum of four and a half months. This period is increased to six months if the gross annual remuneration exceeded 64,508 euros on 31 December 2013;

• otherwise, the notice period is equal to one and a half months per five years of seniority, with a maximum of three months;

for seniority after 31 December 2013:

• the notice period is determined according to the table below. The notice period is a maximum of thirteen weeks. If, based on the seniority as of 31 December 2013, the calculated notice period already exceeds thirteen weeks, no further action is required.

Any pay cap is no longer taken into account when calculating the notice period after 31 December 2013.

Length of service and notice given by the employee (in weeks):

0 to less than 3 months: 1
From 3 months to less than 6 months: 2
From 6 months to less than 12 months: 3
From 12 months to less than 18 months: 4
18 months to less than 24 months: 5
From 2 years to less than 4 years: 6
4 years to under 5 years: 7
5 years to under 6 years: 9
6 years to under 7 years: 10
From 7 to under 8: 12; and
From 8 years old: 13.

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