I. Introduction
International groups use share-based incentive plans to reward key employees and retain them over the longer term. Under such plans, a foreign parent company may, for example, grant Restricted Stock Units (RSUs) to employees of its Belgian subsidiary. As the Belgian employer does not itself grant or finance the RSUs, it has sometimes been assumed in practice that no Belgian social security contributions are due on these benefits.
A judgment of the Belgian Court of Cassation of 29 June 2026 casts serious doubt on that reasoning. According to the Court, benefits granted to retain employees, to encourage their continued commitment, or to promote the conscientious performance of their duties, may constitute consideration for work. In that case, they qualify as remuneration under Belgian employment law, even where they are formally granted and financed by a foreign parent company.
The judgment is particularly relevant for multinational groups employing staff in Belgium. Existing RSU plans and other international incentive plans should be reassessed in light of their documentation, purpose and practical implementation.
II. What are RSUs?
An RSU generally represents a conditional right to receive shares, or sometimes their cash equivalent, at a later date. The right becomes definitive only when certain conditions are met, commonly referred to as vesting. These conditions may relate to the employee remaining within the group, the achievement of performance targets, or a combination of both.
RSUs must be distinguished from traditional stock options. A stock option gives the beneficiary the right to acquire shares at a predetermined price during a specified period. An RSU, by contrast, generally does not require the beneficiary to pay an exercise price.
This distinction is legally important. Stock options that comply with the Belgian Act of 26 March 1999 are subject to a specific tax and social security regime. The judgment of 29 June 2026 does not concern that specific regime. It concerns RSUs and the general question of whether the benefit granted constitutes “remuneration” for Belgian social security purposes.
The name given to an incentive plan is not decisive. The specific rights, conditions and objectives of the plan must always be examined separately.
III. Why is the concept of remuneration decisive?
Belgian social security contributions are, in principle, calculated on an employee’s remuneration. Article 14 of the Social Security Act of 27 June 1969 generally refers in this respect to the concept of remuneration contained in Article 2 of the Wage Protection Act of 12 April 1965.
That concept first includes the consideration for work performed under an employment agreement. In addition, a benefit measurable in money to which an employee is entitled as a result of their employment and which is borne directly or indirectly by the employer may also constitute remuneration.
This gave rise to a fundamental question in the context of international share plans. What if the foreign parent company establishes the plan, selects the beneficiaries, bears all the costs and contracts directly with the employees? Can the benefit nevertheless constitute remuneration attributable to the Belgian employer?
The answer does not depend exclusively on who bears the financial cost. If a benefit constitutes consideration for work, it may qualify as remuneration regardless of whether it is granted by the employer itself or by a third party. The reason why the benefit is granted then becomes crucial.
IV. Long-running proceedings concerning an international RSU plan
The case concerned RSUs granted by a foreign parent company to certain employees of two Belgian group companies. The stated purpose of the plan was to retain the beneficiaries over the longer term.
The parent company made the final decision on the grants. It also determined the conditions governing the grant, the vesting, and the forfeiture of the RSUs. The agreements were entered into directly between the parent company and the beneficiary employees. The Belgian companies were not parties to those agreements, did not bear the costs, and had not undertaken to grant the RSUs themselves.
The Belgian companies were not, however, entirely absent from the process. They could suggest the names of employees during the selection process and provide reasons supporting their recommendations. Following an inspection, the Belgian National Social Security Office (NSSO) claimed social security contributions on the benefits granted.
In 2022, the Court of Cassation overturned an initial judgment under which the RSUs had been subject to social security contributions. Following referral, the Antwerp Labour Court of Appeal ruled on 20 November 2023 that the RSUs did not constitute remuneration. The Labour Court of Appeal referred, among other things, to the parent company’s independent decision-making and financing and to the absence of any commitment on the part of the Belgian employers.
The NSSO brought a further appeal before the Court of Cassation. This resulted in the judgment of 29 June 2026.
V. What did the Court of Cassation decide?
The Court started from the established principle that remuneration under employment law constitutes consideration for work performed under an employment agreement.
It then formulated an important rule: benefits granted to retain employees within the undertaking, to encourage their continued commitment, or to promote the conscientious performance of their duties, are granted as consideration for work and therefore constitute remuneration under employment law.
This finding goes to the heart of many RSU and long-term incentive plans. Retention is often not merely an incidental effect of such plans, but one of their express objectives. Vesting also frequently depends on the continuation of the employment relationship and, in some cases, on individual or collective performance.
The Labour Court of Appeal had itself found that the plan was intended to retain the beneficiaries within the undertaking over the longer term and that the Belgian companies could recommend candidates and provide reasons for doing so. According to the Court of Cassation, those findings did not legally support the conclusion that the RSUs were not consideration for work and therefore did not constitute remuneration.
The Court consequently overturned the judgment of the Antwerp Labour Court of Appeal and referred the case to the Brussels Labour Court of Appeal.
VI. No automatic social security liability for every share plan
The judgment must be read carefully. The Court of Cassation did not rule that every share-based benefit, every RSU, or every plan operated by a foreign parent company, is automatically subject to Belgian social security contributions without any further analysis.
The Court of Cassation merely reviews the legality of the contested judgment and does not conduct a complete reassessment of the facts. Following the referral, the Brussels Labour Court of Appeal must assess the case within the legal framework clarified by the Court of Cassation.
Nevertheless, the direction is clear. Where a plan is intended to retain employees, to encourage their continued commitment, or to promote the conscientious performance of their duties, it becomes particularly difficult to argue that the benefit is entirely unrelated to the employment relationship.
The absence of a cost recharge to the Belgian employer, a contractual commitment by the Belgian employer or formal decision-making powers at the local level, is not sufficient to exclude the benefit from the concept of remuneration.
Conversely, the specific circumstances must still be examined. This includes assessing the rights actually granted to the employee, the legal and economic basis for the grant, the applicable vesting conditions, the beneficiary selection process and the role played in practice by the Belgian employer.
VII. What is the potential financial impact?
If RSUs are classified as remuneration, ordinary social security contributions may become due on the value of the benefit. In the private sector, the employee social security contribution is, in principle, 13.07%, and the standard basic employer contribution is, in principle, 25%.
A simplified example illustrates the potential exposure. If an RSU benefit has a contribution basis of EUR 100,000, this could, in principle, result in employee contributions of EUR 13,070 and basic employer contributions of EUR 25,000. If the employer compensates the employee for the employee contribution, an additional gross-up effect arises. Based on highly simplified assumptions, the total employer cost could consequently increase by more than 40%. The precise calculation must be made on a case-by-case basis.
The risk is not necessarily limited to future grants. As the judgment interprets existing statutory concepts, earlier grants or vesting events within the applicable limitation periods may also be reviewed. If no personal security contributions were withheld, the employer will have to support these without the possibility to reclaim these from the employee.
As a general rule, NSSO claims are subject to a limitation period of three years from the date on which the claim becomes due. A longer period may apply in cases involving fraudulent conduct, or false or deliberately incomplete declarations. Late regularisations may also give rise to contribution surcharges and interest.
Classification as remuneration may also have other employment law consequences, for example for the calculation of certain termination indemnities or holiday pay. These consequences were not decided by the judgment of 29 June 2026 and should not automatically be inferred from it. They require a separate analysis based on the concept of remuneration and the rules applicable to the relevant payment.
VIII. What should international groups do now?
Companies with employees in Belgium should systematically identify and review their existing share-based and other incentive plans. It is not sufficient to examine only the formal plan rules or the accounting allocation of the costs.
A comprehensive assessment should cover at least the following elements:
- the nature of the instrument, such as RSUs, shares, stock options, warrants, phantom shares or cash-settled awards;
- the express and actual objectives of the plan, including retention, motivation and performance-based remuneration;
- the grant and vesting criteria;
- the consequences of dismissal, resignation, retirement, incapacity for work or a transfer to another group company;
- the role of the Belgian employer in the selection, recommendation, communication and administration process;
- the contractual documents between the parent company, the Belgian employer and the employee;
- any recharge or cost-sharing arrangements within the group;
- the Belgian payroll, tax and social security treatment;
- the valuation and the time at which the benefit must be reported; and
- the treatment of previous grants within the relevant limitation periods.
The internal flow of information also requires careful attention. The Belgian employer can only comply with its reporting obligations if it receives timely information about grants, vesting events, share values, leavers and any cash settlements. A plan that is administered entirely from abroad without structural reporting to the Belgian payroll therefore creates a significant compliance risk.
Finally, the communication and documentation surrounding the plan should be consistent with the intended legal treatment. Where presentations, award letters or internal communications expressly describe the plan as a reward for performance or as a means of retaining and motivating employees, those elements are relevant to the assessment of whether the benefit constitutes remuneration. The practical implementation of the plan is at least as important as its formal structure.
IX. Conclusion
The judgment of 29 June 2026 represents an important development for international share-based incentive plans. A foreign parent company may grant and fully finance RSUs independently, but this does not exclude Belgian social security contributions where the benefit is, in reality, intended to retain or motivate employees or encourage their continued commitment.
This does not mean that every RSU plan is automatically subject to Belgian social security contributions. It does, however, make clear that an analysis based exclusively on the identity of the formal grantor or the absence of a recharge is no longer sufficient. The purpose of the plan, the vesting conditions, local involvement and practical implementation are central to the assessment.
International groups employing staff in Belgium should therefore reassess their existing and future incentive plans. An integrated employment law, social security and tax analysis can help prevent unexpected contributions, regularisations and disputes with the NSSO.
Questions about the Belgian treatment of RSUs, stock options or international incentive plans? Please feel free to contact the authors, Alexis Ceuterick or Rik Strauven.
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This newsletter does not constitute legal advice or a legal opinion. Please consult with a legal counsel of your choice before taking any action based on the information provided.