Legal Framework Employer of Record (EOR) in Belgium (2025)

While the Employer of Record (EOR) model operates smoothly in many countries, Belgium presents a more complex legal landscape due to its strict Temporary Employment Act. This law prohibits the transfer of employer authority to third parties unless the EOR is officially recognized as a temporary employment agency. Without such recognition, EOR arrangements may violate Belgian legal framework and expose foreign companies to legal risks.

Many international Employer of Record providers overlook this nuance, which can result in unlawful employment practices. Speed and convenience may be appealing, but in Belgium, legal compliance is non-negotiable. The legal framework must be followed.

Recently, the Flemish region clarified the legal conditions for EOR operations, and it is expected that Wallonia, Brussels, and the German-speaking Community will follow suit.

What Is an Employer of Record (EOR)?

An Employer of Record is a third-party organization that acts as the legal employer of a worker on behalf of a foreign company without a local entity in Belgium. The EOR handles all legal and administrative obligations, including:

• Payroll processing and salary payments
• Social security contributions and tax filings
• Insurance and optional company car management
• Compliance with Belgian labor law and sector-specific wage standards

Meanwhile, the foreign company retains responsibility for recruitment, selection, and daily supervision. The employee works operationally for the foreign company (the “economic employer”) but is legally employed by the Employer of Record.

Who Benefits from EOR Services?

• International companies and scale-ups seeking fast market entry in Belgium without setting up a local entity
• IT professionals and digital nomads looking to work legally under a Belgian employment contract and workers regulations

Legal Challenges of EOR in Belgium

Despite its global popularity, the EOR model faces significant legal restrictions in Belgium due to the Temporary Employment Act, which tightly regulates the lending of employees to third parties.

Prohibited Employee Lending

• The traditional triangle between employee, foreign client, and Employer of Record has long been viewed as illegal employee lending.
• Many foreign EOR providers mistakenly assumed their services fell outside temporary employment regulations and did not require formal recognition.

Legal Framework Since 2025

• As of 2025, there is no room for interpretation: EOR services are only permitted under temporary employment law, and only if the EOR is a recognized agency.
• Operating without recognition is a direct violation of Belgian law.

Restrictions on Employer Authority

• The foreign client may not exercise employer authority over the EOR-hired employee.
• Tasks such as approving leave, managing absences, imposing disciplinary actions, or deciding on salary increases are strictly prohibited.
• This makes operational management challenging without breaching legal boundaries.

Duration and Flexibility

• A positive development: the previous six-month limit on temporary employment has been relaxed.
• Indefinite contracts are now allowed under the recognition framework, enabling long-term international employment.

Legal Alternatives for EOR Activities in Belgium

Although EOR services are permitted under strict conditions, there are three legal models for offering EOR-like solutions in Belgium:

EOR as a Recognized Temporary Employment Agency

This is the standard legal model:

• The EOR must obtain a license through regional procedures (Flanders, Wallonia, Brussels, German-speaking Community).
• Employment must be temporary, though since 2025, indefinite contracts are also allowed.
• The EOR may legally lend employees to clients, who may then exercise employer authority.
• No physical presence in Belgium is required, but a local contact point (e.g., law firm or representative) is mandatory.
• This model demands full compliance, financial guarantees, and transparency—but offers legal certainty.

EOR as a Service Provider (Without Recognition)

An alternative model that does not require a temporary employment license:

• A written service agreement must be signed between the EOR and the client.
• The client may only give functional and operational instructions (e.g., work content, safety), but not exercise employer authority.
• The EOR retains full legal responsibility as the employer.
• No legal time limit applies, though contracts are often limited in practice to avoid legal risks.
• This model is simpler but requires strict adherence to authority boundaries.

Foreign Employer Without Establishment in Belgium

A fully legal and cost-effective alternative is to become non-residential employer in Belgium:

• Legal compliance: Avoids the risks associated with EOR models
• Fast setup: With the right partner, registration takes just 2–3 weeks
• Full access to Belgian employment infrastructure:
  • Enterprise number via the Crossroads Bank for Enterprises
  • Registration with Belgian social security (NOSS)
  • Insurance, tax registration, external safety services, meal vouchers, etc.

Financial Advantages

Belgium offers generous social security reductions for employers hiring their first employees—even without a local entity.

To avoind misunderstandings: Yes, these benefits apply to non-residential employers. They are making labor costs highly competitive.

Future Outlook for EOR Services in Belgium

The future of EOR in Belgium looks promising, but only for providers who prioritize legal compliance and strategic positioning.

Growth Driven by Globalization and Flexibility

• Rising international mobility and demand for flexible work models fuel EOR market growth.
• EOR is suitable for both skilled and unskilled workers and aligns with Belgian payroll models.

Legal Maturity and Quality Assurance

• Belgium has formally integrated EOR into temporary employment law, removing legal ambiguity.
• Strict rules are now seen as a quality benchmark: recognized providers gain trust and credibility.
• Licensed Belgian agencies are well-positioned to expand into Employer of Record services using their infrastructure and compliance expertise.

Limitations and Tax Disadvantages

• Operating as a non-residential employer is more cost-effective than using an Employer of Record company.
• Foreign employers using EOR miss out on:
  • Social security exemptions for first hires
  • Payroll tax exemptions for R&D activities
• Risk of triggering a permanent establishment remains, depending on the nature of work and cost structure.