Until recently, there was some controversy in calculating the termination payment due by the employer when terminating the contract of an employee with reduced working hours based on the Belgian time credit system. The question was whether the termination payment must be calculated
- based on the employee’s (hypothetical) full-time remuneration, applicable before the reduction of his or her working hours, or
- on the basis of his or her part-time remuneration?
This controversy did not relate to the calculation of the notice period’s duration, since, in this case, the hypothetical full-time remuneration must be taken into account by law. With regard to the termination payment, however, in the absence of a clear regulation, case law generally rules that it must be calculated on the basis of the employee’s part-time remuneration.
A ruling by the European Court of Justice (22 October 2009) contributed to further uncertainty. In the case at hand, the ECJ ruled that the termination payment of an employee on part-time parental leave ought to be calculated on the basis of her hypothetical full-time remuneration and not on the basis of her part-time remuneration at the time of dismissal.
The question which remained after this ruling was whether this rule should also apply to employees with reduced working hours based on time credit to avoid discrimination.
Decision of the Constitutional Court
In two rulings of 10 November 2011, the Constitutional Court ruled that there is no unjustified discrimination. The Constitutional Court developed two main arguments:
- With respect to parental leave, the ECJ aims to promote equality between men and women and its ruling must be interpreted in a specific European context. The Belgian time credit system constitutes a purely national regulation that does not have this specific purpose. Therefore, the ruling by the European Court of Justice does not prevent the application of a different rule with regard to part-time time credit;
- The law already provides for sufficient measures to protect employees dismissed while in time credit. The law not only provides that the notice period should be calculated on a hypothetical full-time remuneration basis, but that the employee is also entitled to compensation (equivalent to a six months remuneration) in case he or she is dismissed because of time credit.
The Constitutional Court thus rejected the application of the ECJ’s ruling to other forms of part-time employment.
Conclusion
For dismissed employees with reduced working hours based on the time credit system, the notice period must be calculated on the basis of the hypothetical full-time remuneration, whereas termination payment must be calculated taking into account the part-time remuneration.
As for future developments, it can be expected that the Constitutional Court will be requested to rule on other cases where the calculation of the notice period and specific forms of part time work (other than time credit) are involved.
