In a case of 5 September 2022, the Cour de Cassation (Supreme Court) had to rule on the qualification as remuneration under Belgian social security law, concerning restricted stock units (RSU’s) awarded to the employees of Belgian companies by the American mother company of the employers. The Belgian National Social Security Office and the lower Courts were of the opinion that these RSU’s constituted wage, but the Supreme Court disagreed.
Article 2 of the Act on the protection of wages defines a wage as the benefits which can be valued in money, and to which the employee is entitled pursuant to his employment at the expense of the employer. The RSU plan of the American mother company included a very broad definition of employee, meaning all the employees of the American company, but also all the employees of its subsidiary companies. The lower courts used this equation to state that the American mother company should be considered as the employer who is granting the shares to the Belgian employees. The Supreme Court disagrees and states that this internal equation in the RSU plan does not turn the American mother company into the employer of the Belgian employee. Therefore, the American mother company remains a third party. According to the previous case law of the Supreme Court, benefits awarded by a third party can only be considered remuneration if the benefits form a compensation in return for the actual performance of labour by the employee in execution of the employment contract.
This new case and the previous case law of the Supreme Court lead to the conclusion that in order to escape the qualification of remuneration (for social security contributions), the following 3 conditions should be fulfilled (together):
