More and more retirees are reentering the workforce in Belgium

An increasing number of pensioners are reentering the workforce in Belgium. Employers say they seek them out for their expertise, flexibility and reliability.

A Brussels home delivery company told Le Soir that they used to have quality problems until bringing retirees on staff.

“We had parcels disappearing, complaints about rude drivers, delays,” said distribution manager Jonathan De Lange. 

“One day, we tested the pensioners and we immediately saw the difference. We've been working with them for three years now and we're delighted. They have a high sense of responsibility, they are reliable... There are only advantages.”

Less enthusiastic are trade unions, who say retirees are taking on jobs because their pension isn’t enough to cover living expenses. 

“We have more and more situations where pensioners have to continue working to get by,” said national secretary of the CSC union Anne Léonard. Selena Carbonero, federal secretary of the FGTB, said this trend is likely to grow. 

Both unions point to issues related to a pension’s real replacement rate (a percentage of the average income received during the worker's career) being too low, the negative impact of part-time work (a problem that affects women in particular) and the failure to take into account a series of salary benefits, among other things.

But working retirees that Le Soir spoke to cited happiness as their primary reason for remaining employed.

That was also the conclusion of a study by Federgon, the temporary work federation, carried out in November among 6,469 temporary workers. 

When asked what their motivation was for going into temporary work, the over-64s cited the happiness of working as their number one reason, followed by a desire for supplementary income, the desire to make a contribution to society and the need to feel valued.

Working pensioners remain a minority

According to figures from the FPS Finance, in 2020 (figured based on 2019 income reporting) there were 84,853 pensioners declaring professional income of more than €1,000, or 4.2% of all retirees. 

But this number has grown by 54.5% compared to 2011, while the number of pensioners has increased comparatively by just 18.8% in the same period. The overall employment rate of 65-69 year-olds rose from 4.7% in 2016 to 5.8% in 2020, according to a Labour Force Survey.

Part of the growth can be explained by deliberate policy choices intended to ‘activate’ retirees, like advantageous changes to the tax system and a flexi-job system for certain sectors like hotels and restaurants. 

In the last quarter of 2021, there were 13,940 pensioners with flexi-job status, making up 16% of all flexi-jobs. 

The figures for those engaged in temporary work also saw an increase: around 10,000 pensioners aged 65 and over worked as temps in 2021, according to the sectoral federation Federgon. The number was 3,000 in 2013. 

Belgian retirees can keep working under special circumstances 

In Belgium, a pensioner or the spouse of someone who receives a pension at the household rate may continue to work only under certain conditions. 

These conditions mainly relate to the person’s age and the length of their career, with the result that the income received is limited. However, that ceiling disappears from 1 January of the year in which the pensioner reaches the age of 65, or if he or she has worked for 45 years at the time of retirement, or if he or she receives a transitional allowance.

Conversely, a person receiving a survivor's pension due to the death of his or her spouse has his or her cumulative income limited according to his or her age and the possible presence of dependent children. 

These capped amounts, which can be found on the FPS Finance website, vary between almost €7,000 and a little over €30,000 per year, depending on the individual case.

Even when authorised, the extra income is taxed at a progressive rate per bracket and is aggregated with any professional income, according to Jérôme Noël, a tax lawyer at Tetra Law. 

“A pensioner who works will therefore move up the tax brackets and be taxed more. And as pension income is deducted in advance without taking into account any additional income, the deduction may prove insufficient and the pensioner will have to pay tax at the end of the year.”

There’s also a tax reduction that applies to pension income that should be considered. However, Noël said this “will be reduced if the pensioner receives other income, and the overall tax to be paid at the end of the year will be higher.”