ICL - expat_ll.php

Labor Law

In Luxembourg, the provisions regarding the employer-employee relationship are contained in the Luxembourg Labour Code (see Code du Travail). Some collective bargaining agreements [i.e. Collective bargaining agreement for bank employees (www.abbl.lu), Collective bargaining agreement in the insurance sector] may provide for a larger range of benefits.

The Luxembourg Labour Code provides for a set of minimum rights. The employment contract may set out additional conditions that are more favourable to the employee, but it cannot establish exceptions to the minimum statutory requirements that are disadvantageous to the employee.

Sanction: Any clauses of an employment contract that restricts the rights or increases the obligations of the employee as set out in the Luxembourg Labour Code, are void.

Contents

Return to Expat GuidesImmigrationSocial Security

The employment contract

Top

The rule is the indefinite employment contract, the exception is the fixed-term employment contract.

Sanction: If the strict conditions for a fixed-term employment contract should not be met, the contract shall be deemed as an indefinite employment contract.

Indefinite employment contract

Form requirements

Top

The employment contract must be signed at the latest at the start of the employment

Sanction: any trial period is null and void

What to do: Where one of the parties refuses to sign the employment contract, the other party may - but not before the third day following the request for signature and within 30 days after the start of employment - withdraw from the employment contract without notice or damages.

Content

Top

Trial period

Top
Purpose

The trial period allows:

Form requirements

The employment contract containing the trial period must be signed at the latest at the start of the employment

Sanction: the trial period is null and void and the contract is deemed to be concluded for an indefinite time from the beginning

Duration of the trial period

Principle: ≥ 2 weeks to ≤ 6 months

The employer and the employee cannot agree to a longer trial period than the one authorised by the law.

Sanction: the trial period is reduced to the maximum period authorised.

Exceptions:

Automatic extension of the trial period

Neither party to the employment contract may extend or renew the trial period

Sanction: the trial period renewed or extended is null and void.

Particular cases
Termination of the contract during the trial period
Termination with notice Termination with immediate effect
Impossible during the first two weeks, unless by mutual consent Always possible in case of gross misconduct
No reason has to be given for the termination The reasons have to be explained with details in the termination letter

Notice period:

  • If the trial period is expressed in weeks, the notice to be given is one day per week of the agreed trial period (i.e. 2, 3 or 4 days notice period according to the nr of weeks agreed)

  • if the trial period is expressed in months, the notice to be given is 4 days per month, with a minimum of 15 days and a maximum of 1 month (i.e. 15, 16, 20, 24, 28 days, or 1 month according to the nr of months agreed).

The notice period has to expire before the end of the trial period.

No notice period
No preliminary meeting No preliminary meeting

Modification

Top

In the course of the employment relationship, the original agreement may be modified, according to the situation, under certain conditions.

Situation Rule Requirements
Modification by common consent Always possible Addendum in writing specifying the modifications and the date of entry into force - 2 copies
Unilateral modification by the employer favourable to the employee Always possible Addendum in writing specifying the modifications and the date of entry into force - 2 copies
Unilateral modification of a non-substantive clause by the employer Always possible Addendum in writing specifying the modifications and the date of entry into force - 2 copies
Unilateral modification of a substantive clause by the employer to the employee's disadvantage
Sanction: the modification is void
Only possible following a strict procedure In accordance with the same strict requirements for the form and the timing of dismissal with notice

Fixed-term employment contract

Top

Permanent positions, which are part of the everyday activities of the business, may not be occupied by employees holding fixed-term employment contracts.

Sanction: Failing this, the fixed-term employment contract is considered as an indefinite employment contract.

Object of a fixed-term employment contract

Top

A fixed-term employment contract can only be concluded to carry out a specific type of work over a defined period of time, specifically:

Form requirements

Top

The employment contract must be signed at the latest at the start of the employment

Sanction: the fixed-term employment contract is considered as an indefinite employment contract and the employer shall not be able to prove otherwise.

Content

Top

The fixed-term employment contract must contain specific reference to the temporary nature of the work.

Sanction: the fixed-term employment contract shall be deemed an indefinite employment contract and the employer shall not be able to prove otherwise.

Term of the fixed-term employment contract

Top

≤ 24 months, renewals included.

Sanction: If the contract exceeds 24 months, it will be qualified as an indefinite employment contract

Renewal of the fixed-term employment contract

Top

A fixed-term employment contract may be renewed twice. The possibility of renewal and, where appropriate, the terms of renewal must be defined either in the original contract or in an addendum to that contract.

Sanction: If the aforementioned requirements are not met, the renewed fixed-term employment contract will be renewed and qualified as an indefinite contract and the employer will not be able to prove otherwise.

Sequence of fixed-term employment contracts

Top

Principle: A position cannot be filled by several successive fixed-term contracts.

A period of restraint must be observed between the conclusion of several fixed-term employment contracts relating to the same position in the company. This period of restraint must amount to the equivalent of one third of the period of employment during the previous employment contract (renewals included).

Sanction: the fixed-term employment contract shall be deemed an indefinite employment contract

Exception: in certain circumstances no period of restraint needs to be observed for:

Trial period

Top

Cf. trial period for indefinite employment contracts.

Ending a fixed-term employment contract

Top

The fixed-term employment contract ends automatically on the foreseen expiry date.

Sanction: Except in the case of gross misconduct, or in case of termination by mutual agreement, the termination of a fixed-term employment contract before the completion of its term entitles the other party to damages.

Cf. End of the contractual relationship

Specific aspects of employment relations


Working time

Top

Statutory public holidays

List of statutory public holidays in Luxembourg

Top

10 statutory public holidays:

Statutory public holidays have to be taken into account when calculating the weekly working hours.

If a statutory public holiday falls on a Sunday or on a rest day, the employee is entitled to a compensatory day off, which must be taken within a period of 3 months.

What to do: it is up to the employee to ask his/her employer to take the compensatory day off within the 3 months period.

Remuneration

Top

With respect to remuneration of statutory public holidays, employees are entitled to the salary corresponding to the number of hours they would normally have worked on that day.

Work on statutory public holidays

Top

Work on statutory public holidays is strictly regulated by law.

If the employee has to work on a statutory public holiday, his/her remuneration will be as follow:

Leave

Annual Leave

Top

Minimum: 25 working days/calendar year

Collective bargaining agreement may provide for more days

Extraordinary leave

Top

Maternity leave

Top
Pre-natal leave

A pregnant woman is not allowed to work during the 8 weeks preceding the expected date of birth. The expected date of birth is fixed by a medical certificate.

Post-natal leave

A woman is not allowed to work during the 8 weeks following childbirth. This period must be attested by a medical certificate indicating the date of birth.

In the event of a premature or multiple birth, and in the event of a mother breast-feeding her child, the duration of post-natal leave is extended to 12 weeks.

During maternity leave:

  • The employee is entitled to maternity payments equivalent to payments during sickness, provided that she has been affiliated to the social security system for at least six months during the year preceding the year in which the maternity leave takes place.
  • The employer is obliged to keep the woman's position, or if this is impossible, a similar position corresponding to her qualifications and with remuneration at a level at least equivalent to her former remuneration
  • The employer is not entitled to terminate the woman's employment contract
After maternity leave

The employee, in order to raise her child, is given the option of not resuming her position, and this without notice or penalty. In such a case, the employee, for a period of one year, retains the option to re-apply for a similar position, in the event of a suitable vacancy.

Parental leave

Top
Conditions

Both parents of a young child under 5 years of age are entitled individually to parental leave provided that they meet certain conditions:

Length

Full-time parental leave: 6 months

Part-time parental leave: 12 months (the parent's normal working hours must be reduced by at least half)

Practical points

What to do:

For the first parental leave: the parent must inform the employer by registered mail advising of his/her to take parental leave at least 2 months before the start of maternity leave.

If no parental leave is taken immediately after maternity leave, one of the parents loses his/her entitlement to parental leave

For the second parental leave: the parent must inform the employer by registered mail, advising of his/her intention to take parental leave at least 6 months before the start of parental leave

During the period of parental leave, the contract of employment is suspended and the employer is not allowed to give notice of termination of the contract. A dismissal during this protected period is null and void. This protection however is not applicable in the event of termination for a serious breach of contract

What to do in case of dismissal with notice: a request must be addressed by the employee to the president of the labour court within a period of 15 days.

During the period of parental leave, the employer is obliged to keep the employee's position open, or if this is not possible, a similar position corresponding to the employee's qualifications and with equivalent remuneration

Leave for family reason

Top
Purpose

Entitlement to this form of leave is only available in special circumstances (serious sickness, accident or serious health reasons) and provided that the child is under 15 years old.

Length

Principle: 2 days per child per year.

Exception:

Special leave for family reasons does not have to be taken all at once but can be taken piecemeal.

The period of leave for family reasons is considered equivalent to a period of incapacity for work or for accident. During this period, the legal provisions regarding social security and protection in the workplace continue to be applicable to the beneficiaries. The informed employer is not authorised to notify to the employee the termination of the employment contract or an invitation letter to a preliminary dismissal meeting.

Leave for end-of-life care

Top

Every employee has the right to ask for leave for end-of-life care in the case a parent (1st degree in direct line of ascent/descent or 2nd degree in collateral line), spouse or partner is suffering from a serious illness in a terminal stage.

The length of the leave for end-of-life care cannot exceed 5 days, divisible, for each case and per year.

What to do:

The procedure for informing the employer of the absence is identical to the information procedure in the event of sick leave. On the first day of absence, the employee or a person acting on behalf of the employee, must inform, either orally or in writing, the employer or its representative.

Upon request by the employer or the health insurance, the employee has to prove that the different conditions for the granting of the leave for end-of-life care were satisfied.

The period of leave for end-of-life care is assimilated to a period of incapacity for work for reasons of sickness or accident. During that period, the provisions in relation to social security and protection at work remain applicable to the beneficiaries.

Moral harassment and violence in the workplace

Definition

Top

On 25 June 2009, the trade unions OGB-L and LCGB, on the one hand, and the Union of Luxembourg Companies (Union des Entreprises Luxembourgeoises, UEL) on the other, signed an agreement on moral harassment and violence in the workplace.

Under the agreement, moral harassment is deemed to occur when a person employed by a business undertaking repeatedly and deliberately commits a wrongful act against another employee (including managers) that affects intentionally or not the latter's rights or dignity, worsens his/her working conditions, impairs his/her future career, or undermines his/her physical or mental health by creating an intimidating, hostile, degrading, humiliating or offensive workplace environment.

Work-related violence occurs when an employee feels assaulted by one or several deliberate acts intended to affect the employee's physical or moral integrity. It may emanate from persons belonging to the undertaking or from external persons, and be an isolated act of a certain severity or several acts, each of the same or a different nature.

Beneficiaries of the protection against moral harassment/violence

Top

The measures of protection against moral harassment/violence apply to the following persons:

Obligations of the employer regarding moral harassment/violence

Top

Even if the employer is not the perpetrator of the act of harassment or violence at work, it could be held liable for such act as it is responsible for preventing and penalising such behaviour. Indeed, it must stop any acts of harassment.

Through various internal channels of communication, the employer must raise employees' awareness in relation to definition of harassment and violence at work, how to tackle incidents and the available sanctions against the perpetrators of such acts.

Rights of a victim of moral harassment/violence

Top

Measures that are aimed at stopping the moral harassment or violence can never be applied against the victim of the harassment.

Protection against sexual harassment

Definition

Top

Sexual harassment in the workplace is any behaviour with a sexual connotation or any other behaviour based on sex for which the person committing it knows or should know that it affects the dignity of a person at work, if one of the following conditions are met:

The behaviour can be physical, verbal or non-verbal.

Intention is assumed in such behaviour.

Beneficiaries of the protection against sexual harassment

Top

The measures of protection against sexual harassment apply to the following persons:

Obligations of the employer regarding sexual harassment

Top

The employer is obliged to take all necessary preventive measures to ensure the protection of the dignity of every person in the workplace. These measures must also include measures of information.

The employer must not only refrain from any act of sexual harassment in the workplace, but he/she also must prevent and stop any acts of harassment caused by:

Rights of a victim of sexual harassment

Top

Measures that are aimed at stopping the sexual harassment can never be applied against the victim of the harassment.

Any provision or act taken against the victim of the harassment, and especially any termination of his/her employment contract, is null and void.

In the event of the termination of the employment contract, the employee can, within 15 days after the notification of the termination, make a simple request to the president of the labour court, who sits in summary proceedings, for the termination of the employment contract to be declared void and the continuation or the reintegration of the employee to be ordered.

Resignation of the victim of sexual harassment

Top

The employee who has been subjected to an act of sexual harassment can refuse to continue his/her employment contract and terminate it without notice, for serious reasons and seek damages to be paid by the employer whose misconduct caused the termination with immediate effect.

In principle, the employee who resigns from his/her work is not entitled to unemployment benefit. However, if the resignation results from an act of sexual harassment in which the employee was a victim, the president of the labour court can authorise the latter to receive temporary unemployment benefits.

Before asking for temporary unemployment benefits, the victim must have introduced another claim before the labour court, in order to have the notice, based on harassment, declared justified because of the employer's misconduct, which did not include appropriate measures to stop the sexual harassment.

Remuneration

Top

Salary consists of the total remuneration of the employee.

Total remuneration includes:

As a matter of principle, remuneration is freely determined by the employer and its employee.

The employer, however, has to respect the rate of the statutory social minimum wage (1921,03 EUR on 1.10.2013) and possibly also adhere to the scales of remuneration provided for by certain collective bargaining agreements.

The salary stipulated in figures is paid each month and at the very latest on the last day of the month concerned.

Additions to the salary stipulated in the contract, such as directors' fees, discounts, bonuses, premiums and other payments of such nature, are paid at the very latest during the two months following either the year of service, or the closure of the commercial year, or the drawing up of the results for that commercial year.

Indemnity payments in the event of sickness

Top

The Labour Code provides for continued salary payments and other gratifications resulting from the employment contract. An employee is entitled to a payment until the end of the calendar month of the occurrence of the 77th day of incapacity, during a reference period of 12 successive calendar months. A new right to continued salary payments only arises at the beginning of the month following the month ending before this limit.

There is a minimum duration of 77 days. In fact, when the employer has reached the 77th day of continued salary payment, he/she is obliged to pay the salary until the end of the ongoing month. Afterwards, an indemnity for work incapacity is paid by the National Health Insurance.

Tax card

Top

The resident taxpayer under first time employment in the Grand Duchy of Luxembourg has to request a tax card in person at the population office of their local municipality.

He must hand over the tax card to the employer, who will require it for the purposes of tax on salaries, social security contributions and other tax-related formalities.

Labour unions

Top

Employees have the right to be member of a labour union.

   CGFP
   28, Dernier Sol
   L-2543 Luxembourg
   Tel.: (+352) 26 48 27 27
   Fax: (+352) 26 48 29 29
   cgfp@cgfp.lu
   www.cgfp.lu

   FNCTTFEL - Landesverband
   63, rue de Bonnevoie
   L-1260 Luxembourg
   Tel.: (+352) 48 70 44 1
   Fax: (+352) 48 85 25
   info@landesverband.lu
   www.landesverband.lu

   LCGB
   11, rue du Commerce
   L-1351 Luxembourg
   Tel.: (+352) 49 94 24 1
   Fax: (+352) 49 94 24 49
   info@lcgb.lu
   www.lcgb.lu

   OGB-L
   60, bd J.-F. Kennedy
   B.P. 149
   L-4002 Esch-sur-Alzette
   Tel.: (+352) 54 05 45 1
   Fax: (+352) 54 16 20
   ogbl@ogbl.lu
   www.ogb-l.lu

   FGFC
   66, rue Baudouin
   L-1218 Luxembourg
   Tel.: (+352) 40 77 20 1
   Fax: (+352) 40 77 20 40
   fgfc@fgfc.lu
   www.fgfc.lu

   ALEBA
   29, avenue Monterey
   L-2163 Luxembourg
   Tel.: (+352) 22 32 281
   Fax: (+352) 22 32 03
   info@aleba.lu
   www.aleba.lu

   CGT-L
   60, bd J-F Kennedy
   L-4170 Esch-sur-Alzette
   Tel.: (+352) 54 05 45 242
   Fax: (+352) 54 16 20

End of the contractual relationship


Termination by mutual consent

Top

An employment relationship may be ended if the employer and the employee mutually agree. The contract ends at the mutually agreed moment.

No unemployment benefits are paid to an employee after a termination by mutual consent.

Form requirements

Top

Unilateral termination with notice period

Termination by the employer - Dismissal with notice

Top
Prerequisite

The dismissal must be based on real and serious reasons, i.e. which are either personal - absenteeism, poor performance - or economic.

Form requirements
Notice period

The notice period varies according to seniority:

Length of service Notice required
< 5 years 2 months
≥ 5 years 4 months
≥ 10 years 6 months

What to do: Within the first month of receiving notice of termination of employment, the employee has the right to ask the employer to provide in writing, and sent by registered mail, the reasons for the termination of his/her employment.

If requested by the employee to do so, the employer shall be obliged to provide the employee with a detailed explanation of the reasons for the termination based either on the capacity or the behaviour of the employee or based on the needs of the undertaking or entity or department's functioning. These reasons must be real and serious. This information shall be in writing and sent by registered mail no later than 1 month after receipt of the employee's letter requesting the reasons. However, the reasons for the termination must also be explained in such a way as to enable the employee to determine whether to bring a claim for unfair dismissal and to enable a judge (when asked during a court trial) to assess the legal validity of the termination.

The employer may not state additional reasons at a later stage. The reasons given in the letter to the employee will be the only grounds taken into consideration in the event of litigation.

Indeed, according to case law the imprecision of the reasons for termination is considered to be an insufficient reason for termination.

Termination by the employee - Resignation with notice

Top
Form requirements
Notice period

The notice period varies according to seniority:

Length of service Notice required
< 5 years 1 month
≥ 5 years 2 months
≥ 10 years 3 months

Unilateral termination with immediate effect

Termination by the employer

Top
Prerequisite
Form requirements

Termination by the employee

Top
Prerequisite

Serious fault on the employer's side, i.e. harassment, failure to pay the salary, lateness in paying the salary, etc.

Form requirements

Termination with immediate effect must be served within one month of the date on which the employee becomes aware of the circumstances which warrants termination of employment.

Compensation payments for dismissal

Statutory severance indemnity

Top
Seniority Severance indemnity
< 5 years N/A
≥ 5 years 1 month's gross salary
≥ 10 years 2 months' gross salary
≥ 15 years 3 months' gross salary
≥ 20 years 6 months' gross salary
≥ 25 years 9 months' gross salary
≥ 30 years 12 months' gross salary

No entitlement to statutory severance indemnity:

  • If dismissal caused by serious fault of the employee
  • In case of resignation by the employee
  • If the employee is entitled to a retirement pension
  • In case of termination by mutual consent

Court procedure

Top

The dismissed employee can initiate legal proceedings to challenge the fairness of the dismissal and ask for material and moral damages.

If the dismissal is declared unfair, the employee may be awarded damages:

Burden of proof for these damages lies with the employee

Settlement agreement

Top

To avoid long lasting and costly court proceedings, the employer and the employee may sign a settlement agreement.

Mutual concessions depend on various factors (especially precision of the grounds). The employer and the employee must clearly express their unequivocal acceptance to conclude a settlement in order to terminate their litigation. The mutual concessions should be documented in detail.

Collective dismissals/Social plan

Top

If an employer projects at least 7 dismissals for economic reasons within 30 days or 15 dismissals for economic reasons over 90 days, a collective dismissal procedure is compulsory = negotiation of a social plan

Negotiations are about social (employment safeguard) measures and measures of financial compensation

Termination for other reasons

Termination of business

Top

Death of the employee

Top

Retirement

Top

Employee's work incapacity

Top

Automatic lapse of the employment contract:

Obligations in connection with the termination of employment

Final breakdown of a salary

Top

Work certificate

Top

The contents of the work certificate is strictly limited by law and may only contain the following information: dates of employment, capacity, sequences of positions held by the employee.

General discharge certificate

Top

Non-competition clause

Top

Hiring priority

Top

Special protection against dismissal

Top

In these cases, the employees cannot be dismissed nor invited to a preliminary dismissal meeting

Sickness

Top

Protection lapses after 26 weeks of uninterrupted sickness

Pregnancy

Top

What to do:

If the employee has been dismissed notwithstanding the pregnancy, she may request, within 15 days, the president of the labour court to declare the dismissal void and obtain her reinstatement.

Parental leave

Top

What to do:

If the employee has been dismissed notwithstanding the protection of parental leave, he/she may request, within 15 days, the president of the labour court to declare the dismissal null and void.

Staff representation

Top

What to do:

If the employee has been dismissed notwithstanding this protection, he/she may request, within 15 days, the president of the labour court to declare the dismissal void and obtain his/her reinstatement.

Fight against corruption and protection of the employees

Top

What to do:

If the employee has been dismissed as act of retaliation motivated by the above mentioned reasons, he/she may request, within 15 days, the president of the labour court to declare the dismissal void and obtain his/her reinstatement.