In Belgium, like many other countries, the tax burden on salaries is significantly high. Bonuses and paid leave are taxed at rates exceeding 50%, resulting in employee frustration and a sense of unfairness. This heavy taxation diminishes the net income employees take home, leading to decreased job satisfaction and motivation. Companies face the challenge of retaining talent and maintaining high levels of employee satisfaction amidst these financial pressures.

The Innovative Solution: Cafeteria Plan

EFMP Belgium partner, Impact Sales & Marketing addresses this issue with the Cafeteria Plan, offering a flexible and advantageous system to manage compensation.

What is a Cafeteria Plan?

The Cafeteria Plan allows employees to choose from a variety of benefits that best meet their personal needs. This flexibility helps optimise compensation, increases employee satisfaction, and strengthens their long-term commitment to the company.

To sum up, this plan transforms variable elements of the salary package, such as bonuses and paid leave, into a flexible budget that employees can use according to their preferences.

Available options include:

-Cash

-Warrants

-Pension savings

-Bicycle leasing

-Tablets / Smartphones

Each option has different tax implications and net values, allowing employees to maximise their net income.

The Main Objectives of the Plan

Comprehensive Compensation Management: Optimising compensation according to personal needs and the company's social responsibility.

Tax Benefits: Offering tax advantages for employees and employers.

Unique Digital Platform: Implementing a digital platform for the company, fostering a sense of ownership and shared success.

International Applicability: Ensuring that the plan is adaptable to different countries.

Strategic Partnership

After a thorough analysis of HR, financial, and legal issues, and potential partnerships, we decided that Ernst & Young (EY) will collaborate with Impact Sales & Marketing to implement this project. 

Digital Support Tool

To support the Cafeteria Plan, we are developing a digital tool with EY that will offer:

-Single sign-on access

-Multilingual support

-Web and mobile compatibility

-Integration with external benefits providers for an all-in-one experience

-Tax and reward information for each product

-Intelligent filtering of the benefits catalog based on eligibility profiles

Project Timeline

This project started in Belgium in April 2024, with an analysis of potential partners and legal aspects. Implementation for the 200 employees is scheduled for September 2024. The design-to-deployment process takes between three and nine months. Key phases include plan design, tool setup, HR policy preparation and contract analysis, as well as post-launch training and support.

Benefits for Employers and Employees

For Employees

The plan offers significant tax savings and an increase in net income, thus increasing job satisfaction.

For Employers

Employers benefit from tax advantages and can offer more personalised and attractive compensation packages, leading to greater satisfaction and retention of employees. That’s why this plan also increases the employer's attractiveness.

Impact Sales & Marketing’s Cafeteria Plan addresses Belgium's high employee tax burden by allowing customised benefits and optimised compensation. This plan improves employee satisfaction and loyalty, giving employers a competitive edge in talent retention. It effectively addresses modern employer-employee challenges with tailored solutions that benefit all stakeholders.

Aligned with the company's IT strategy, this digital solution is accessible via tablets and mobiles, ensuring convenience. It also includes eco-friendly and CSR options. The Cafeteria Plan enhances benefits management, provides financial advantages, and strengthens employee-company relationships, supporting Impact Sales & Marketing’s sustainable growth.