Legal clarity for Employer of Record (EoR) services in Belgium

What is an Employer of Record?

An Employer of Record is a company that formally employs workers on behalf of a foreign business. The EoR assumes responsibility for all legal obligations, such as payroll administration, compliance with labor regulations, insurance, and potentially the management of company vehicles. The foreign company remains in charge of recruitment, selection, and day-to-day supervision of the employee.

This model is particularly appealing to international companies and scale-ups that wish to operate in Belgium without establishing a legal entity. It also provides a flexible solution for IT professionals and digital nomads who want to work in Belgium under a local employment contract.

From legal uncertainty to a clear legal framework

While EoR services were already explicitly regulated in the Netherlands under temporary employment law, Belgium long lacked a clear legal framework. The triangular relationship between employee, foreign company, and EoR was often viewed as a form of unauthorized labor leasing.

Following the COVID-19 pandemic, demand for this type of international employment increased significantly. Many EoR providers claimed their services did not fall under temporary agency work and therefore did not require a license.

After thorough investigations by labor inspection authorities and discussions with social partners, Belgium has now clarified its position: EoR services are allowed, but only within the scope of temporary employment legislation.

Key conditions for EoR services in Belgium

An EoR arrangement is only permitted in Belgium if:

• The provider holds a temporary employment agency license, and

• The employment relationship between the EoR and the worker is temporary in nature.

  However, the previous six-month limit on such contracts has been lifted.

It is also worth mentioning that many EoR contracts are signed for an indefinite duration, which is atypical for temporary agency work. However, in line with the federal government agreement, indefinite-term temporary work is now being made possible.

International EoR providers are not required to have a physical office in Belgium but must appoint a local point of contact, such as a law firm or a permanent representative. This ensures effective communication with labor inspection services and allows required documents to be presented when needed.

Outlook for the EoR Market in Belgium

The combination of globalization and the growing demand for flexible labor models is expected to drive further growth in the EoR sector. International labor mobility has become a structural component of the modern economy. While the market is developing rapidly, competition remains high and profit margins relatively limited.

Due to the structural delegation of employer authority, EoR services in Belgium officially fall under the rules for temporary agency work. The model shows strong similarities with payrolling, a service that Belgian temporary employment agencies have offered for decades. It is suitable for both high-skilled and low-skilled workers.

The new regulations lower the threshold for foreign companies to hire workers in Belgium without requiring in-depth knowledge of the country’s complex labor laws. At the same time, workers' social protection remains safeguarded through the temporary employment system, and the EoR provider assumes the risk in case of the client company's insolvency.