A Ray of Hope During the COVID-19 Pandemic: COVID-19 Bonus Available Starting August 1

Numerous companies and their employees have made tremendous efforts over the past year and a half. As a result, despite the COVID-19 crisis, they were not only able to stay afloat but also achieve strong results. It should come as no surprise, then, that these companies also want to reward their employees. But what is the best way to do that? In early May 2021, the government had already announced that it would include a “COVID-19 bonus” in the 2021–2022 wage agreement. Starting August 1, 2021, employers can actually award this bonus. Companies that still managed to achieve good results during the COVID-19 crisis can give their employees a one-time extra bonus of up to 500 euros net. This may exceed the 0.4% wage cap. Please note that the COVID-19 bonus is not a cash bonus. The bonus is granted in the form of consumer vouchers. These consumer vouchers will be issued by the traditional providers of meal and eco-vouchers: Edenred, Sodexo, and Monizze. They charge a small fee for this service. Employers can already order the COVID-19 bonus—that is, the meal vouchers—and grant them from August 1, 2021, through December 31, 2021. Employees have until December 31, 2022, to use the vouchers. Unlike the consumption vouchers that some employees received in 2020, there will now be a wider range of spending options. The intention is that the vouchers can be spent not only in the hospitality, cultural, and sports sectors, but also in all retail stores and department stores. The COVID-19 bonus is very attractive from both a social security and a tax perspective. Each employee can receive up to 500 euros net in consumption vouchers. That amount is exempt from the normal social security and tax deductions on wages. The employer pays only a special employer contribution of 16.5%. In practical terms: a net 500 euros in COVID-19 bonus represents a total payroll cost of 582.5 euros for the employer. The bonus is fully deductible as a business expense.

• The COVID-19 bonus is reserved for companies that achieved “good results.” The definition of “good results” can be determined by the joint committees or at the company level. Unless the sector makes the bonus mandatory—which has not happened in any sector so far—the final decision therefore rests with the employer. This allows a company to determine for itself whether it has the financial resources to do so.
• The COVID-19 bonus is a collective benefit. It will be granted through a collective bargaining agreement or an individual written agreement, but must in any case be provided to all employees, or at least to all employees belonging to a specific group.

Now that a national wage agreement has been reached between the social partners on July 15, most sectors are expected to begin negotiating an agreement after the summer break. Although it is unlikely that the COVID-19 bonus will become mandatory within some joint committees this year, it is not impossible. In any case, employers who wish to do so may grant the additional compensation starting in August. Crauwels Advocaten is closely monitoring developments and would be happy to assist you in developing an appropriate and motivating wage policy for your employees.