Changes to the rules on determining notice periods as of 28 October 2023
09 Nov 2023
Effective 28 October 2023, several modifications and clarifications of the rules on determining the notice period applicable in case of the termination of employment agreements that started before 1 January 2014 entered into force. It”s important to stress that these changes indeed only relate to employment agreements that started before 1 January 2014 and are terminated – by either the employer or the employee – as of 28 October 2023.
Background – transitional measures included in the unified status act
The act on the introduction of the unified status between blue-collar and white-collar workers (‘the Unified Status Act’) introduced standardised notice periods as of 1 January 2014. Transitional arrangements were also introduced for employees who were already employed by their employer before 1 January 2014. For them, a two-step calculation of the notice period applies: the notice period consists of the sum of the notice period calculated on the basis of their seniority until 31 December 2013 on the one hand and the new notice periods as from 1 January 2014 on the other hand. However, in practice, the application of these transitional measures in a number of specific situations gave rise to discussion.
Notice period in case of resignation: always capped at 13 weeks
We already reported on this change, which was included in an act of 20 March 2023 and entered into force on 28 October 2023, in a previous newsletter. In essence, this act abolished the above-mentioned two-step notice period calculation method in case of termination by the employee. As of 28 October 2023, only the notice periods included in article 37/2 §2 of the Employment Agreements Act apply in case of resignation by the employee, irrespective of their status as blue-collar worker or (higher-earning or not) white-collar worker, including when the employment agreement entered into force before 1 January 2014. This article contains notice periods that are proportionate to the employee’s seniority, maxing out at 13 weeks of notice as from 8 years of seniority.
This modification makes sure that, if an employee whose employment agreement started before 1 January 2014 resigns, the notice period they’ll have to serve is capped at 13 weeks. This was always the intention of the legislator (and was as such included in the Unified Status Act), but there was some debate on whether a higher notice period might be applicable to blue-collar workers in this situation, by using the above-mentioned two-step calculation method. This debate has now been settled. In addition, this modification addresses the criticism of the Constitutional Court, which repeatedly ruled that the Unified Status Act’s transitional measures that provided for higher notice periods in case of resignation by higher-earning white collar workers (4,5 months and 6 months respectively, depending on the yearly salary on 31 December 2013) violated the principle of equality.
Termination by the employer – a mistake is rectified
However, in trying to meet the criticism of the Constitutional Court by abolishing the transitional measures in case of resignation by higher-earning white-collar workers, the act of 20 March 2023 inadvertently also abolished the Unified Status Act’s transitional measures for these employees in case of termination by the employer. This would have deleted the Act’s specific formula for the first part of the two-step calculation method for these employees – one month per started year of seniority, with a minimum of 3 months – as of 28 October 2023. This would in turn have meant that, from then on, the legal, statutory and conventional rules applicable on 31 December 2013 would have to be applied for this first step, which in practise would mean a revival of the Claeys-formula.
This was of course not the intention of the legislator, who remedied this mistake with a recently approved act. This act states that the specific calculation formula for step one of the two-step calculation of the notice period for higher-earning white-collar workers remains in effect after 28 October 2023. However, the act also states that, if there was a valid termination clause on 31 December 2013, this will take precedence over the formula. This latest addition brings the provision in line with case law of the Constitutional Court on this matter.
Entry into force
The above-mentioned changes entered into force on 28 October 2023 and only will not affect any notice given before this date.
Conclusion
The changes to the regulations on determining the notice period for employees whose employment agreement started before 1 January 2014 bring clarity and legal certainty on a number of topics. Employers will have to take these changes into account as from 28 October 2023.
If you have any questions on how these changes will affect your company, don’t hesitate to reach out: we’d love to hear from you.
