Over 38% of Belgian employees will receive no salary increase beyond statutory indexation this year, HR services provider Randstad revealed last week in its Hudson Reward Survey.
The survey, which looked at over 375,000 salary packages across 400 different roles, also shows that after accounting for inflation, wage growth in Belgium is expected to be just 0.89% this year.
"Without indexation this year, the rise of fixed base pay is very low. It is the second lowest it has been in 10 years, which shows that the budget of companies for pay is quite under pressure," Paul-Etienne Siegrist, Senior Reward Manager at Randstad, told The Brussels Times.
"Companies don't have much room after indexation to allocate a pay rise for people who merit an increase beyond indexation," he said. Therefore, many are looking at ways to increase employee pay without baking in these costs in the future.
A complicated landscape for pay
Most Belgian workers are covered by a collective bargaining agreement, alongside other sector-specific agreements, which determine statutory salary increases each year to keep pay in line with inflation.
However, given recent rounds of successive inflation, driven in part by increases in energy prices, the current Federal Government introduced a cap on some automatic indexation through a new 'cent index'.
The cent index limits salary indexation increases to the first €4,000 of gross salary. Everything above that receives no indexed uplift to match inflation.
The cap sits alongside a Wage Norm Law, which limits how much wages in Belgium can increase compared with a number of nearby countries.
The aim behind the law is to ensure Belgian firms remain internationally competitive and don't lose out in the long term from customers choosing cheaper suppliers (due to lower wages) in nearby countries.
Employers and unions have been negotiating alternatives to the cent index, which neither likes.
They are also locked in discussions about rebalancing the Wage Norm Law, which some feel is too heavily weighted towards international competitiveness, rather than domestic purchasing power for workers.
Belgium's automatic indexation saw pay rise rapidly after the Covid-19 pandemic, before smoothing off while waiting for wages in nearby countries to catch up.
This smoothing has kept pay growth low in recent years, even while inflation has been shooting up. This is because the Wage Norm Law limit was lower than automatic indexation would have allowed.
Employers are turning to annual bonuses instead of fixed pay increases
The net effect of these changes, plus added concerns about the economy's direction, is that employers are turning to other ways to top up salaries, according to Randstad. These alternatives include bonuses, such as CCT 90 (collective bonus), and other extra-legal benefits like meal vouchers.
Some employers aim to use these non-wage options to boost take-home pay and stay competitive for talent, while keeping their future cost base low.
"What we see is that the companies are looking for alternatives," explained Siegrist. "In our survey, 42% of employees have received a collective bonus."
"The use of warrants has also increased. We used to see warrants just for senior managers, but now we see this going to employees and specialist experts in the company."
Warrants are short-term stock options that employers buy from a financial institution and hand to staff as a one-off bonus. These are exempt from social security contributions, and employees can quickly resell the warrant for cash rather than hold it as shares.
Siegrist noted that the use of warrants has increased, from being given to 6% of employees in 2025 to 11% this year, a proportion never seen before in their survey.
Many companies are looking to warrants or other kinds of bonuses like CCT 90 because they are more flexible and do not increase the business' fixed cost structure, as they are paid only for the year. This is linked to wider economic uncertainty, according to Siegrist.
"In the context of uncertainty, and what else is happening with other prices, employers don't have much room within their fixed cost structure for pay increases," he explained.
