How does Belgium classify Freelancers and identify false self-employment?

Belgian law assesses the existence or absence of a relationship of authority through four general criteria.

The intention of the parties

The first criterion concerns the legal relationship chosen by the parties and expressed in their agreement.

The parties may state that they intend to establish an independent service relationship. This intention is respected only if it corresponds with the way the relationship is actually performed.

The chosen classification cannot be maintained where the practical working arrangements contain facts incompatible with independent status.

Freedom to organise working time

A genuine Freelancer ordinarily has meaningful freedom to decide when the services will be performed, subject to agreed deadlines and legitimate operational requirements.

Factors that may indicate employment include:

• compulsory working hours;

• a schedule determined by the Client;

• an obligation to work a minimum number of hours;

• approval requirements for holidays or absences;

• an obligation to explain or justify absences;

• attendance or time-recording requirements; and

• consequences for not being available at specified times.

Restrictions on working time do not automatically establish employment. They may result from commercial requirements, agreed deadlines, safety obligations or coordination with other parties. Their purpose and practical effect must therefore be examined.

Freedom to organise the work

A genuine Freelancer ordinarily decides how the agreed service or result will be produced.

Factors that may indicate employment include:

• detailed instructions concerning how tasks must be performed;

• continuous assignment of tasks by the Client;

• compulsory internal procedures unrelated to the required result;

• close operational supervision;

• approval requirements during ordinary performance;

• restrictions on using personnel or substitutes; and

• the absence of meaningful discretion over the method of performance.

A Client may still define the expected result, quality requirements, deadlines and applicable legal or security standards without automatically creating employment.

Possibility of hierarchical control

The final criterion concerns whether the Client can exercise hierarchical authority over the Freelancer.

Hierarchical control may include the ability to:

• direct the individual’s work;

• monitor how the work is performed;

• evaluate personal performance;

• require compliance with internal instructions;

• correct the manner of performance; and

• impose consequences or sanctions.

The Client does not need to exercise this power continuously. The practical possibility of exercising authority can be sufficient.

The classification depends on the convergence of facts found throughout the relationship.

Factors that may support employee status include:

• continuing personal performance of work;

• fixed or compulsory working hours;

• an obligation to remain available;

• wage-like periodic remuneration;

• detailed instructions concerning performance;

• reporting to an internal manager;

• approval requirements for leave or absences;

• performance monitoring;

• an inability to use personnel or substitutes;

• inclusion in employee meetings or organisational structures;

• use of an internal job title;

• application of employee disciplinary procedures;

• restrictions on working for other Clients; and

• limited commercial or financial risk.

Factors that may support genuine independent status include:

• freedom to accept or reject Assignments;

• meaningful control over working time and place;

• responsibility for deciding how the services are performed;

• the ability to use personnel, subcontractors or substitutes;

• responsibility for expenses;

• investment in equipment or business infrastructure;

• payment for results, projects or deliverables;

• the ability to negotiate fees;

• responsibility for correcting defective work;

• the ability to serve several Clients;

• operation under an independent commercial identity; and

• participation in commercial profits and losses.

No factor should automatically determine the result. For example, working for one Client does not by itself create employment. It may nevertheless contribute to a finding of dependence when combined with control, fixed remuneration and organisational integration.

Similarly, freedom to reject an Assignment does not automatically prove independence. The Client’s authority must also be examined during the performance of work that the Freelancer has accepted.

Article 333 of the Programme Law identifies factors that, by themselves, have no influence on the classification of the relationship.

The neutral factors are:

• the title of the agreement;

• registration with a social-security institution;

• registration in the Crossroads Bank for Enterprises;

• VAT registration; and

• the way income is declared to the tax authorities.

Therefore, the following do not prove independent status:

• calling the document a freelance, consultancy or independent-contractor agreement;

• requiring the Freelancer to issue invoices;

• using a business number;

• registering the individual as self-employed;

• charging VAT; or

• declaring the remuneration as independent professional income.

These formalities may be required when operating a genuine independent business. However, they do not demonstrate whether the Client exercises hierarchical authority.

The same principle applies in the opposite direction: the existence of a particular administrative registration does not prevent evidence showing that the relationship is genuinely independent.

Where the practical relationship contains sufficient elements incompatible with the chosen classification, the relationship may be reclassified.

An independent service relationship may be reclassified as employment where the facts demonstrate employer authority. Conversely, an employment relationship may be reclassified as independent activity where the practical arrangements are incompatible with employee status.

Reclassification may result from:

• a decision of a Labour Tribunal or Labour Court of Appeal;

• a social-security investigation;

• a labour inspection;

• proceedings initiated by the National Social Security Office;

• a dispute brought by the worker; or

• a ruling by the Administrative Commission for the Regulation of the Employment Relationship.

Where a Freelancer is reclassified as an employee, the consequences may include:

• registration under the employee social-security system;

• employer and employee social-security contributions;

• interest, contribution increases or penalties;

• payroll and employment-record corrections;

• minimum remuneration under applicable legislation or collective agreements;

• holiday pay;

• working-time and overtime entitlements;

• end-of-year or sectoral payments where applicable;

• protection concerning illness, maternity and workplace safety;

• termination and notice rights; and

• application of relevant sectoral collective bargaining agreements.

The exact consequences depend on the claim, the relevant sector, the applicable limitation periods and the facts established in the proceedings.

The parties cannot prevent reclassification through a contractual clause stating that the Freelancer waives employment rights or accepts exclusive responsibility for classification.