“Centimes index”: what does this mean in practice?
In our newsletter of 19 January 2026, we already informed you about the planned “centimes index.” The measure has since been approved by Parliament and has been in force since 1 June 2026.
Below you will find an overview of how this new measure will be applied in practice.
What is the centimes index?
The centimes index consists of two main components:
- As of 1 June 2026, the government limits automatic salary indexation twice for higher salaries.
- A new special employer contribution aimed at wage moderation is introduced, whereby employers must transfer half of the savings resulting from this limitation of indexation to the government.
Limitation of salary indexation: how does it work?
In Belgium, salary indexation in the private sector is regulated at sector level. Each sector determines how indexation is calculated and when it is applied.
The centimes index has a direct impact on these sectoral indexation mechanisms, as indexation is partially limited for employees with a reference salary above 4,000 EUR:
- For salaries up to and including 4,000 EUR gross, nothing changes and full indexation will continue to apply.
- For higher salaries, indexation is capped: all indexations only take effect up to 2% of the reference salary, capped at 4,000 EUR. Once a total wage moderation of 2% has been reached, the normal sectoral indexation mechanism without limitation will apply again.
Since there is no uniform indexation mechanism, the practical application of this limitation varies from sector to sector.
- If indexation equals 2%, the reference salary up to 4,000 EUR gross will be indexed at 2%. The portion above 4,000 EUR will not be indexed.
- If indexation is higher than 2%, the reference salary above 4,000 EUR will only be increased by the percentage exceeding 2%.
Example: An employee has a reference salary of 5,000 EUR gross. The applicable index rate is 2.5%.- Under normal indexation, this would be calculated as follows:
5,000 EUR × 2.5% = 125 EUR - However, under the centimes index, it will be calculated as follows:
(4,000 EUR × 2%) + (5.000 EUR × 0.5%) = 105 EUR
- Under normal indexation, this would be calculated as follows:
- If the indexation is lower than 2%, the centimes index may require multiple indexations before a total wage moderation of 2% is reached.
The limitation is applied twice: a first time from June 2026 (“the first wage moderation period”) and again from January 2028 (“the second wage moderation period”).
For employers in sectors where wages are indexed this year still, the limitation of indexation must already be applied this year. In sectors that only index in January, such as Joint Committee 200, the limitation will only be applied for the first time in January 2027.
From 1 January 2028, the limitation will be applied a second time. The threshold amount of 4,000 EUR gross, increased in line with the pivot index for civil servant wages, will again be used as the reference.
This indexation limitation will be automatically processed in payroll calculations.
What is meant by the reference salary?
The reference salary is the gross fixed full-time base salary. Variable remuneration or bonuses, overtime pay, meal vouchers and eco vouchers, year-end bonuses, etc., are therefore not considered.
For part-time employees, the full-time equivalent must be calculated. Daily or hourly wages must also first be converted into a monthly salary to determine the reference salary.
The measure also applies to minimum wages, sectoral salary scales and pay grades, both at sector and company level, once this salary exceeds 4,000 EUR gross.
What is the employer “wage moderation contribution”?
In addition to the limitation of indexation, an employer wage moderation contribution is also introduced. Employers in the private sector will have to pay an additional contribution corresponding to half of the difference between normal indexation and the reduced indexation.
This contribution is introduced in several phases:
- During the first and second wage moderation periods, employers pay a special employer wage moderation contribution as soon as the indexation limitation is applied.
- Once the targeted wage moderation of 2% is reached in the first wage moderation period, this employer contribution is converted into a provisional consolidated wage moderation contribution.
- Once a 2% moderation has again been achieved in the second wage moderation period, the provisional consolidated wage moderation contribution is replaced by the final consolidated wage moderation contribution.
The calculation method for the (provisional and final) consolidated wage moderation contribution still needs to be determined by Royal Decree.
The various contributions will be calculated automatically in payroll.
Is the employer obliged to apply the centimes index?
If an employer decides to fully index reference salaries above 4,000 EUR anyway, they would be acting in violation of the law. However, the law itself does not provide for a specific sanction for this infringement.
That said, failing to apply the centimes index may have the following consequences:
- Possible breach of the wage norm: for 2025–2026, the wage norm is set at 0%. Fully indexing salaries above 4,000 EUR may result in additional labour costs on top of the statutory indexation. These additional costs count towards the wage norm and may therefore constitute a breach of it.
- Mandatory payment of wage moderation contributions: even if the employer does not apply the indexation limitation, they remain obliged to pay both the special and, subsequently, the consolidated wage moderation contribution.
Please do not hesitate to contact us for more information at legal@pro-pay.be.
