Cafetaria plan

Cafeteria plan? What kind of beast is that? What are the rules and is it even for me?

Which joint committees are eligible to use the end-of-year premium as a budget in a cafeteria plan?

What are joint committees?

A joint committee (or PC) is an entity composed of an equal number of representatives from employer organizations (VBO, UNIZO, UCM, Boerenbond) and trade unions (ACV, ACLVB, ABVV). They were created in 1968 to group together companies with similar activities and to conclude agreements that are binding for the entire sector (e.g. minimum wages). As of January 1st of this year, there were 100 different joint committees and 64 joint sub-committees, each with their own sector-specific rules.

Joint committees, end-of-year premiums and cafeteria plans

In addition to determining minimum wages (or "salary scales"), the joint committee also holds the pen when it comes to end-of-year premiums (or "thirteenth month"). For example, the mandatory introduction of an end-of-year premium, the method of calculation, the timing and manner of allocation are determined by the joint committee.

And that's where the problem lies. Many sectoral agreements (or "collective labor agreements") traditionally stipulate that end-of-year premiums must be paid in "cash". A payment of an end-of-year premium in any other way is not possible according to the letter of the agreement. And since these sectoral agreements are higher in the "hierarchy of legal norms" than an individual employment contract or a practice within the company, a company cannot deviate from the cash payment of an end-of-year premium.

This means that in many traditional sectors, the (heavily taxed) end-of-year premium cannot serve as a budget in the cafeteria plan. This is unfortunate, given that the cafeteria plan has become a very popular tool for allowing employees to fill in a part of their salary package themselves without increasing the labor cost for the employer.

In sectors where the end-of-year premium must be paid in cash, we do see a trend emerging to award (limited) bonuses as a budget in the cafeteria plan. The same applies to sectors that do not have an end-of-year premium. This allows these employees (often workers) to still use a budget to choose vacation days, IT equipment or bike leasing in the cafeteria plan. If they ultimately do not choose any of the benefits in the cafeteria plan, the bonus will still be paid out in cash.

Does the future hold the answer?

An increasing number of sectors (such as PC 100, 200, 307, 316, 329, 336, 341, etc.) are becoming aware of the importance of a flexible salary package. A salary package that responds to the personal needs of an employee can be an important argument for choosing a certain employer (or remaining with them). Against the backdrop of the well-known war for talent that rages in almost every sector, an attractive salary package is therefore not a luxury.

This observation has recently led to some concrete proposals to give cafeteria plans a legal basis. There is currently no "cafeteria plan law". A law would nevertheless be a breakthrough for countless employers and employees, as a legal provision takes precedence over an agreement concluded within the joint committee.

Payflip is closely following the developments surrounding cafeteria plans and end-of-year premiums!

If you have any questions about how a cafeteria plan or end-of-year premium works within your joint committee, please feel free to contact a Payflip expert via maura@payflip.be.

Should an employer offer all benefits in a cafeteria plan?

No, the employer is completely free to offer a chosen amount of benefits in the cafeteria plan. Some companies have a very extensive package. Other companies have a cafeteria plan with 1 or 2 benefits. This is completely free to choose on the employer's side.

Payflip helps you make the right choices in your company.

How does a cafeteria plan compare to a mobility budget?

Both a cafetaria plan and a mobility budget are elements that employers can offer to employees to provide more flexibility in their compensation package.

A cafetaria plan offers employees the opportunity to use a portion of their salary to purchase benefits in order to enjoy a tax advantage. This budget can be used for various benefits, such as multimedia, hospitalization insurance for your partner, extra car contributions, etc.

A mobility budget is a legally regulated choice that an employer can offer to employees to finance a predetermined budget that employees can use for their commuting. This budget can be used for various means of transportation, such as a bicycle, public transportation, or a lease car. The mobility budget thus offers employees more freedom and flexibility in their transportation choices.

Compared to a cafetaria plan, a mobility budget offers more targeted support for employees who want to optimize their commuting. However, a cafetaria plan offers more flexibility in the choice of employment conditions and can also include other important employment conditions, such as a higher pension or extra vacation days.

What happens when an employee is fired or resigns?

If the employee completes their service, unfortunately they can no longer use the cafeteria plan 🥲

The following puzzle is put together:

  1. Benefits
    1. Cancellation: We will see which benefits can still be cancelled, for example unused vacation days.
    2. Termination: The benefit of family hospitalization insurance and outpatient insurance will be terminated.
    3. Ordered: The benefits of multimedia and bicycles cannot be cancelled, as they have already been ordered and delivered.

End-of-year bonus budget Payflip works with the principle of pre-financing the end-of-year bonus throughout the year. Therefore, the employee can spend their future end-of-year bonus (which is normally paid out in December) throughout the year in the cafeteria plan.

When the employee leaves, we will determine whether or not they are entitled to an end-of-year bonus. Each sector has established different rules for this.

As a white-collar worker in PC200, the employee receives a pro rata end-of-year bonus and consequently a budget when they have more than 5 years of seniority with their employer upon leaving.

If the employee has less than 5 years of seniority with their employer, they are not entitled to an end-of-year bonus and therefore no budget.

Bonus Budget When the employee leaves, they are still entitled to their bonus.


For a positive result, the employee has enjoyed fewer benefits than their budget allowed. This remaining balance will be paid out upon their departure.

For a negative result, the employee has enjoyed more benefits than their budget allowed. This balance will be deducted from their net departure vacation pay.

Which legal documents need to be drawn up to start a cafeteria plan?

To start a cafeteria plan, the following legal documents need to be drawn up:

  1. Cafeteria plan regulations: This document contains the rules of the cafeteria plan, such as who can use it, which employment conditions can be traded, and which rules apply to the implementation of the plan.
  2. Attachment to the employment contract: If the cafeteria plan is introduced after the start of the employment contract, an attachment to the employment contract must be drawn up and individually signed, which includes the cafeteria plan.
  3. Compensation policy: The cafeteria plan may have consequences for the company's compensation policy. Therefore, the compensation policy must be adjusted.
  4. Policies: Depending on the benefits included in the cafeteria plan, policies must be created for the benefits.

It is important to draw up these documents before implementing the cafeteria plan to provide clarity to employees and prevent future conflicts.

Payflip provides these documents as part of the start-up phase of the cafeteria plan.

What are the disadvantages of a cafeteria plan?

A cafeteria plan can have some disadvantages for both employers and employees.

One of the main disadvantages is that it can be administratively complex to implement and maintain a cafeteria plan. Employers must understand the rules and regulations of the plan well and ensure that they are applied consistently. It is therefore important to work with a partner who provides sufficient guidance and support.

In addition, it can be confusing for employees to decide which options best suit their desires and needs. They also need to be well informed about the pros and cons of each option in order to make informed decisions.

Another disadvantage of a cafeteria plan is that it can lead to inequality among employees. For example, employees with higher wages may benefit more from the tax advantages of the plan than employees with lower wages.

Finally, a cafeteria plan can also create additional administrative costs for employers. Setting up and maintaining the plan, as well as providing information and training to employees, can incur additional costs.

Although a cafeteria plan can have some disadvantages, it can still be an attractive option for some employers and employees due to the flexibility it offers. It is important to carefully weigh the pros and cons of the plan before making a decision. If you work with the right partner in the cafeteria plan, most of the disadvantages can be mitigated.

What are the benefits of a cafeteria plan?

A cafeteria plan is a flexible reward system in which employees can choose from various tax-efficient benefits. Below are some advantages of a cafeteria plan:

  • Flexibility: Employees have the freedom to tailor their own compensation package based on their individual needs and priorities. This results in happier employees!
  • Retention: Due to the increased attractiveness of the compensation package and a package that better meets the individual needs of employees, a cafeteria plan has a significant impact on employee retention within a company. This saves valuable time and money that would normally be spent on recruitment and training!
  • Tax benefits: A cafeteria plan can offer tax benefits for both employers and employees. For example, employees can exchange their gross salary for certain benefits, reducing their tax burden and leaving them with more value in their paycheck at the end of the day.
  • Employer attractiveness: A cafeteria plan can make an employer more attractive to potential employees. By providing a higher net salary to employees, it can be a good way for a company to differentiate itself from competitors and attract and retain talent.

Payflip's cafeteria plan offers all of these benefits and more. We believe that a cafeteria plan can be advantageous for both employers and employees. Contact us to discover how our cafeteria plan can help your business.