The wage norm for 2025-2026 is again expected to be 0%. However, payroll costs will increase from 2025, given the indexation and additional payroll cost-increasing government measures.
Based on initial tentative conclusions, we can say that the wage norm for 2025-2026 will again be 0%. Nevertheless, as an employer, you still have to take into account automatic wage indexation and, in all likelihood, additional government wage cost-increasing measures.
On Feb. 21, 2024, the Central Business Council (CRB) published an interim technical report on expected wage cost trends for 2025-2026. This report analyzes the wage cost handicap through 2023 and provides an outlook for Belgium's expected wage cost handicap relative to our neighboring countries (the Netherlands, France and Germany) by the end of 2024.
Let's take a look at what this means for you as an employer and how you can prepare now for 2025.
A wage norm is set every two years, which determines the maximum allowable increase in labor costs compared to the previous period. The purpose of this is to maintain Belgium's competitive position vis-à-vis our neighboring countries and thus guarantee employment. The wage norm is a macroeconomic instrument that limits trade unions' room for negotiation. For individual employers, it is ultimately the impact of the wage norm on sectoral wage negotiations that matters.
Currently, the 2023-2024 wage standard applies. That wage standard is 0%. The next wage norm will be the 2025-2026 wage norm. Nothing set in stone, but we can already draw some initial, albeit tentative, conclusions based on current information.
The recent interim technical report indicates an expected wage cost handicap of 1.8% for Belgium at the end of 2024 compared to our neighboring countries. This indicates a deterioration in our competitive position. The projections suggest that in 2024 the wage cost in Belgium will increase less rapidly than in our neighboring countries, but the handicap will still increase.
What does this expected wage cost handicap mean? Well, concretely, there will be no available margin beyond the automatic wage indexation and baremic increases that are always guaranteed. In other words, the maximum available margin on wage cost development (the wage norm for short) will be 0% for the period 2025-2026, as it looks now.
With an expected wage norm of 0% for 2025-2026, social partners will have little room for negotiation. Employers should be aware of this situation and plan their budgets accordingly. It is important to consider not only automatic wage indexation, but also possible additional costs, such as purchasing power premiums.
Although the wage standard is set at 0%, wages and labor costs will still increase. For PC200, based on current projections, the automatic wage index equals 5.00% effective Jan. 1, 2025.
In addition to automatic wage indexation, employers must also take into account possible additional compensation. As has been shown in the past, in times when the wage standard is (virtually) 0, the government makes concessions to accommodate the violation of the fundamental right to freedom of collective bargaining that the law with respect to the wage standard commits to it (although they will never say so in so many words).
Consumption vouchers are the instrument of choice for providing that compensation. Also in the period 2023-2024, consumption vouchers were used to grant the purchasing power premium. It is reasonable to budget EUR 250 per employee per year for this additional compensation, to be increased by a 16.5% NSSO employer contribution.
Although the 2025-2026 wage standard is set at 0%, employers should prepare for rising wages and possible additional compensation. By planning ahead and being aware of expected trends, employers can adapt to changing economic conditions and maintain a competitive position.
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