Social security status of daily managers of non-profit organizations: no more hiding behind the corporate veil?

In a landmark decision of 19 May 2025, the Belgian Court of Cassation provided critical reflections on the social security status of individuals performing daily management tasks for non-profit organizations through a management company on a self-employed basis. 

Subject to certain conditions, individuals entrusted with daily management in non-profit organizations are irrefutably presumed to be employees according to Belgian social security legislation.

The Court of Cassation has indicated that the application of the social security regime for employees does not require a direct contractual relationship between the individual and the non-profit organization. Hence, also daily managers of non-profit organizations operating through a management company could become subject to the social security regime for employees, making the payment of both employer and employee social security contributions mandatory.

1. LEGAL FRAMEWORK

In Belgium, employees and self-employed professionals are subject to distinct social security regimes. Generally, employees benefit from a broader social security safety net compared to self-employed professionals. Consequently, the remuneration paid to employees is subject to significant (employer’s and employee’s) social security contributions.

The nature of the contractual relationship (employment agreement versus service agreement) determines the applicable social security regime. 

However, for daily managers in non-profit organizations, the situation is slightly different. According to the Royal Decree of 28 November 1969, the social security regime for employees is extended to individuals who cumulatively meet the following conditions:

• must devote their main activity to the daily management or administration of the non-profit organization;
• must be entitled to remuneration that exceeds mere reimbursement of costs related to housing and/or accommodation; and
• must operate within associations that do not pursue industrial or commercial activities and do not seek to provide a material benefit to its members.

In other words, to remain subject to the social security regime for self-employed professionals, an individual must primarily engage in other operational tasks within the non-profit organization and limit daily management tasks for which he/she can only receive a reimbursement of professional costs. 

2. CASE BACKGROUND AND CONTEXT

The case involved a non-profit organization that entered into a management agreement with a daily manager operating through a management company. No direct contractual relationship existed between the non-profit organization and the individual providing services through the management company.  

The National Social Security Office (RSZ – ONSS) argued that the individual providing services through the management company should be considered as an employee for social security purposes, despite the lack of a direct contractual relationship with the non-profit organization.

Lower Labour Courts rejected this position of the National Social Security Office, emphasizing the legitimacy of the management company structure. According to these courts, to hold the individual behind the management company accountable, the National Social Security Office needed to prove the intention to circumvent the law, which it failed to do.

In its landmark decision of 19 May 2025, the Court of Cassation set aside these previous decisions. 

3. REASONING AND DECISION OF THE COURT OF CASSATION

The Court of Cassation clarified that a daily manager acting through a management company may fall under the social security regime for employees, without requiring the National Social Security Office to prove any intent to circumvent the law. 

The Court of Cassation specified that applying the social security regime for employees to daily managers of non-profit organizations does not require a direct contractual relationship between the individual entrusted with daily management tasks and the non-profit association itself.

According to the Court of Cassation, it is sufficient that – within the framework of a contractual relation – an individual primarily devotes their professional activity to the daily management of a non-profit organization in exchange for remuneration (excluding reimbursements for housing and accommodation costs).

Although the validity of a self-employed collaboration through a management company is recognized by the Court of Cassation, this set-up does not preclude the individual behind the management company from being considered the actual representative of the non-profit association and thus falling under the social security regime for employees. 

Consequently, non-profit organizations may face social security contribution liabilities even when working with formally self-employed professionals.

Following the Court of Cassation’s decision, it is now up to the Labour Court of Antwerp to determine whether the daily management of the non-profit organization was carried out by the management company itself or by the individual behind it. If the Labour Court of Antwerp concludes that the individual personally exercised the daily management personally, that person will be considered an employee of the non-profit organization for social security purposes. Consequently, the non-profit organization will be liable for both employer and employee social security contributions.

4. WHAT DOES THIS MEAN FOR NON-PROFIT ORGANIZATIONS 

According to the Court of Cassation, the existence of a management company does not prevent the application of the social security regime for employees to formally self-employed daily managers of non-profit organizations.  

Non-profit organizations engaging management companies should carefully assess how daily management tasks are executed and ensure their contractual arrangements reflect the operational reality (e.g., it must be clear that it is indeed the management company, rather than the individual behind it, that carries out the daily management of the non-profit organization, as indicated by e-mail signatures, documents signatures, etc.). 

Otherwise, non-profit organizations may face social security contribution liabilities when working with formally self-employed professionals, including the obligation to pay both employer’s and employee’s social security contributions on top of the remuneration paid out to the self-employed daily manager and, potentially, other salary arrears).

As an alternative approach to avoid triggering the application of the Royal Decree, daily management tasks may be performed by a self-employed professional — whether through a management company or not — provided that the following conditions are met:

• daily management tasks do not constitute the individual’s main activity. The individual must also perform other operational tasks beyond daily management tasks;
• no remuneration is granted for the daily management tasks; only a reimbursement of professional costs can be provided. Compensation should be reserved for the other operational tasks carried out by the self-employed professional.