Government restricts wage rises

Government restricts wage rises

27th February 2015, Comments 0 comments

The Belgian government has approved draft legislation to introduce wage restraint that will void the usual wage increase in line with inflation.

Under the new law Belgian wages and benefits that are linked to the retail price index will not be topped up by 2 percent as usually automatically happens when prices rise by 2 percent.

The wage restraint is being introduced because Belgian wages have risen more quickly than those of our main trading partners and, as a consequence, Belgian industry is at a disadvantage.

The measure should help to create new jobs.

But given the fact the Belgian economy is now facing deflation, it could take quite a long time before we will have to forgo the planned wage rise.

If it’s clear we are all not looking at a wage increase soon, great confusion surrounds what will happen to rents.

Are they too being blocked by the freeze or will landlords escape the government’s general austerity. In coming days legal experts will have to decide whether the federal or the devolved governments are responsible and can take a decision.

The government also set the scope for wage rises.

This year the wage bill isn’t being allowed to rise at all. Next year a 0.3 percent rise is allowed without employers being penalised.

If the wage restraint is intended to boost employment, Belgium’s unions remain vehemently opposed to the measure. Socialist trades union leader Rudy De Leeuw warned of social unrest, while Christian trades unionist Marc Leemans insists the measure is unbalanced: “The government has chosen to ask an effort from employees, civil servants, the retired and people on benefit. The self-employed and those living off dividends have not been asked to make any effort.”

 

Flandersnews.be / Expatica

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