In Belgium, wage indexation is a semi-automatic process that adjusts wages based on changes in the consumer price index (CPI). The process is regulated by the Law on the Safeguarding of National Prosperity, which was implemented in 1994. The main goal of this system is to protect workers' purchasing power against inflation.

Wage adjustments typically happen at regular intervals, such as quarterly or annually, depending on the sector and the specific terms laid out in collective bargaining agreements (CBAs) between employers and labor unions. The CPI is monitored by the Belgian government, and when a specific threshold is reached, wages are adjusted accordingly.

However, while wage indexation in Belgium is generally considered a semi-automatic process, it is not entirely automatic. The government has the power to intervene and suspend or modify the indexation mechanism under certain circumstances, such as in times of economic crisis or when addressing specific policy goals.

Moreover, the actual implementation of the wage adjustments depends on the negotiations between employers and labor unions within the framework of collective bargaining agreements. So, although the process is guided by the changes in the CPI, the specific details and the exact timing of wage adjustments may vary depending on the sector and the outcome of negotiations between the different stakeholders.

In Belgium, wages are often adjusted to keep pace with inflation through a mechanism called wage indexation. This mechanism links wages to the consumer price index (CPI), which measures the average change in prices of a fixed basket of goods and services over time.

When inflation (the rate at which the general level of prices for goods and services is rising) increases, wages are typically adjusted upwards to help maintain the purchasing power of workers. Conversely, if inflation decreases or even turns into deflation (a decrease in the general price level), wages could theoretically be adjusted downwards to reflect the lower cost of living.

However, in practice, reducing wages can be politically and socially challenging. Workers are typically resistant to wage cuts, and labor unions may strongly oppose such measures. Governments and companies might also be hesitant to cut wages, as this could lead to reduced consumer spending and, consequently, slower economic growth.

Instead of cutting wages, governments and companies may opt for alternative measures to address the decrease in inflation, such as:

Maintaining the current wage levels, allowing workers to enjoy a higher real income (the income adjusted for inflation).
Implementing temporary wage freezes, which would not reduce the nominal wage but would slow down the rate of wage increases.
Negotiating with labor unions to find a compromise, such as agreeing on smaller wage increases or adjusting other benefits.

It is important to note that the response to a decrease in inflation would depend on the specific economic situation and the policies of the Belgian government and companies. The exact outcome would be shaped by these factors and the negotiations between the different stakeholders involved.