With the introduction of the centimes index, a new mechanism has been added to the already complex system of wage indexation. The measure, approved by the Belgian Parliament and effective since 1 June 2026, aims to moderate wage growth for higher salaries while introducing an additional employer contribution linked to this moderation. Although the principle sounds straightforward, its practical impact is far-reaching for employers, payroll teams, and sectoral bodies.
What Is this Centimes Index?
The centimes index is built around two core components. First, the government limits automatic salary indexation twice for employees earning above a certain threshold. Second, employers must pay a new wage moderation contribution, representing half of the savings generated by this limitation. Together, these elements form a system designed to temper wage increases at the higher end of the salary spectrum.
How Does the Limitation of Indexation Work?
Belgium does not apply a uniform indexation mechanism. Each sector defines its own rules for calculating and applying indexation. The centimes index overlays these sectoral systems by introducing a cap for employees whose reference salary exceeds 4,000 EUR gross.The rules can be summarised as follows:
- Salaries up to 4,000 EUR gross continue to receive full indexation, exactly as determined by the sector.
- Salaries above 4,000 EUR gross are subject to a cap: only the first 4,000 EUR can be indexed at the full rate, up to a maximum of 2%. Once a total wage moderation of 2% has been achieved, the sector’s normal indexation rules resume without limitation.
Because sectors apply indexation differently — some annually, others multiple times per year — the practical implementation varies. In sectors with indexation still scheduled for 2026, the limitation applies immediately. In sectors that only index in January, such as Joint Committee 200, the first limitation will only take effect in January 2027.
Example Calculation
Consider an employee with a reference salary of 5,000 EUR gross and an index rate of 2.5%.
- Normal indexation: 5,000 × 2.5% = 125 EUR
- Centimes index calculation: (4,000 × 2%) + (5,000 × 0.5%) = 105 EUR
The difference — 20 EUR — represents the wage moderation.
If the index rate is below 2%, the limitation may need to be applied multiple times until the cumulative moderation reaches 2%. The mechanism is applied twice: once starting June 2026, and again from January 2028. For the second period, the 4,000 EUR threshold will be adjusted in line with the pivot index for civil servant wages.
Understanding the Reference Salary
The reference salary is the gross fixed full‑time base salary. It excludes variable pay such as bonuses, overtime, meal vouchers, eco vouchers, and year‑end premiums. For part‑time employees, the full‑time equivalent must be calculated. Hourly or daily wages must be converted into a monthly amount.
The measure also applies to minimum wages, sectoral salary scales, and company pay grades once they exceed the 4,000 EUR threshold.
Alongside the indexation cap, employers must pay a new contribution linked to wage moderation. This contribution equals half of the difference between normal indexation and the reduced indexation under the centimes index.
The contribution is introduced in phases:
- During each wage moderation period, employers pay a special contribution as soon as the limitation applies.
- Once the 2% moderation target is reached in the first period, the special contribution becomes a provisional consolidated contribution.
- After the second moderation period reaches its 2% target, the provisional contribution becomes the final consolidated contribution.
The exact calculation method for the consolidated contributions will be defined by Royal Decree. Payroll systems will automatically process the various contributions once the rules are finalised.
Is Applying the Centimes Index Mandatory?
Employers must apply the centimes index. Choosing to fully index salaries above 4,000 EUR would violate the law, even though the legislation does not specify a direct sanction. However, failing to apply the limitation can still lead to significant consequences:
- Risk of breaching the wage norm: For 2025–2026, the wage norm is set at 0%. Fully indexing higher salaries could generate additional labour costs beyond statutory indexation. These extra costs count toward the wage norm and may result in a violation.
- Mandatory payment of contributions: Even if an employer decides not to limit indexation, they are still legally required to pay both the special and consolidated wage moderation contributions. In other words, opting out of the limitation does not exempt the employer from the financial impact.
Practical Impact for Employers and Payroll Teams
The centimes index introduces yet another layer of complexity into Belgian payroll. Employers will need to:
- Review salary structures and identify employees above the threshold.
- Understand how their sector applies indexation and when the limitation must be implemented.
- Prepare for automatic payroll adjustments and new employer contributions.
- Communicate clearly with employees, especially those affected by capped indexation.
Payroll providers and HR teams will play a crucial role in translating this legislative measure into accurate calculations and compliant payslips.
