Flemish inspection services to get new tools in the fight against chain constructions and illegal employment

Social dumping

Due to labour force and skills shortages, companies are forced to hire specialised contractors who themselves often employ foreign workers or subcontractors

(Sub)Contractors who deploy (foreign) personnel in Belgium must enforce Belgian mandatory salary and working conditions (such as (minimum) wages, salary protection and maximum amount of working hours), if these are more advantageous compared to those of the country of origin.

In addition, for a.o. construction works, (sub)contractors must also comply with various registration and reporting obligations, such as the LIMOSA declaration and Checkinatwork (the online service for presence registration).

To avoid social dumping, the Salary Protection Act of 12 April 1965, amended by the Programme Act of 29 March 2012, foresees three regimes of joint liability under which a principal and/or contractor can be held liable for salary debts owned by a direct or indirect (sub)contractor towards their personnel.

The current provisions, however, still allow avoiding immediate liability, provided that certain contractual provisions are included in the services agreement, such as a reference to a website mentioning the applicable minimum wages, commitment to pay the minimum wages and/or not to employ personnel staying in Belgium illegally.

Recent inspections have made it clear that, notwithstanding the regime of joint liability foreseen in the Wage Protection Act, social dumping risks still remain.

The Flemish Government believes that this is due to the possibility to make use of the above-mentioned contractual provisions.

The new draft Flemish Decree to strengthen chain liability

To counter this, the Flemish Government considers amending the Act of 30 April 1999 on the employment of foreign workers via a Flemish Decree. The Draft Flemish Decree of 9 December 2022 imposes an obligation on contractors (not on the principal) to conduct due diligence checks on their direct subcontractors by requesting specific information needed to assess compliance with the legal provisions regarding the employment of foreign workers.

The Flemish Government will draw up a checklist to this end. If the required information is not available, the (sub)contractor must inform his direct (sub)contractor and request that this information is provided. If the latter does not comply with this request, the former must notify the Flemish social inspection, which can then take appropriate action.

To exclude liability, it will no longer be sufficient to include a contractual clause or obtain a declaration from the direct subcontractor confirming that they do not hire illegal employees. This would tackle constructions meant to evade responsibility in case of illegal employment of foreign workers.

The extent and type of information included in this due diligence obligation is now being determined in consultation with the various sectors. It is expected that the new regulation will enter into force by the summer of 2023.