Wage guarantee in case of employer insolvency

L'indemnisation des travailleurs licenciés en cas de fermeture d'entreprises/Vergoeding van de in geval van Sluiting van Ondernemingen ontslagen werknemers

Country	Belgium , applies nationwide
Time period	Open ended, started on 01 January 2011
Context	Restructuring Support Instruments
Type	Legislations or other statutory regulations
Category	Employment protection and retention – Income support for people in employment (e.g., short-time work)
Author	Dries Van Herreweghe (Katholieke Universiteit Leuven) and Eurofound
Measure added	23 June 2022 (updated 23 October 2024)

Background information

The guarantee was implemented in the event of employer insolvency. Via the measure, the employee benefits from a guarantee through the Closure Fund ("Fund to compensate employees made redundant in the event of enterprise closure"). The Fund can then recover the amounts paid out from the guarantee from the employer.

Content of measure

In the case of collective layoffs as a result of bankruptcy or insolvency of a company, workers receive a closing-down indemnity paid by a closing fund managed by the public employment services.

The employment contract must be terminated 12 months before to 13 months after the closing in order to receive guarantees in case of employer’s insolvency.

The measure applies in case of collective dismissals (at least 10 in companies with 20–99 employees, 10% in companies with 100–299 employees, at least 30 in companies with 300 or more employees) caused by bankruptcy or insolvency of the employer.

There are no exclusions of part-time or fixed-term workers.

The fund will intervene in the payment of wages due and indemnities and benefits that are due.

For companies closing after 1 May 2024, the redundancy amounts to €198.95 for each year of seniority in the company. In order to take into account the personal situation of the employees, an additional premium is available for employees over 45 years old. For each year above the age of 45 that they were active in the current company, they will receive an additional €198.95.

The fund is financed through social security contributions by the employer levied on the gross salary of employees.

Payment will be realised also if the employer does not contribute.

Funding is provided by the national government.

Use of measure

2011 25,477 employees received a closing-down indemnity 2012 27,529 employees received a closing-down indemnity 2013 30,073 employees received a closing-down indemnity 2014 28,534 employees received a closing-down indemnity 2015 25,340 employees received a closing-down indemnity 2016 22,704 employees received a closing-down indemnity 2017 21,772 employees received a closing-down indemnity

Target groups

Workers	Businesses	Citizens
Unemployed	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Public employment service	Companies National funds

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Unknown	Unknown
Form	Not applicable	Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

Unknown
Main level of involvement: Unknown

Involvement

Unknown

Views and reactions