Living and working in Luxembourg

18 October 2017

  •   Population: 0.6 million (2017)
  •   Real GDP growth: 3.1% (2016)
  •   Unemployment rate: 6.3% (2016)

Data source: Eurostat

Eurofound provides research, data and analysis on a wide range of social and work-related topics. This information is largely comparative, but also offers country-specific information for each of the 28 EU Member States. Most information is available in English but some has been translated to facilitate access at national level.

Eurofound strives to strengthen the ongoing link between its own work and national policy debates and priorities related to quality of life and work. Increasingly important in this context is the Europe 2020 growth and jobs strategy launched in 2010, which has five headline targets, covering employment through to social inclusion and poverty reduction. The strategy is implemented in the context of the European Semester process – the EU's annual cycle of economic policy guidance and surveillance – which ensures that Member States keep their budgetary and economic policies in line with their EU commitments through, in part, National Reform Programmes. These programmes form the basis for the European Commission's proposals for country-specific recommendations (CSRs) for each Member State.

European Commission: The European Semester
European Commission: The European Semester - EU country-specific recommendations
European Commission: European Semester documents for Luxembourg

2015 Eurofound EWCS survey results in Luxembourg: 97% of people consider themselves good at their work

Survey results

Ability to choose or change
methods of work

Data source: 2015 EWCS survey

Possibility to accumulate overtime
for days off

Data source: 2013 ECS survey

News and quarterly country updates

Latest news on Luxembourg working life

Quaterly overwievs

Eurofound contacts in Luxembourg

Correspondents in Luxembourg

Correspondents report on topics related to developments in the countries working life and inform Eurofound’s pan-European comparative analysis. Read more

Consortium IR Share / Luxembourg Institute of Socio-Economic Research (LISER)

Eurofound governing board members from Luxembourg

Eurofound's Governing Board represents the social partners and national governments of all Member States, as well as the European Commission. Read more

Nadine Welter Ministère du travail et de l'emploi

Patricia Hemmen Business Federation Luxembourg (FEDIL)

Vincent Jacquet Luxembourg Confederation of Christian Trade Unions (LCGB)

Related content

Other country-specific information may be available in certain areas on demand. Please feel free to contact your country contact at Eurofound for this or any other information at information@eurofound.europa.eu

Working life in Luxembourg

About

  • Author: Vassil Kirov, Adrien Thomas and Frédéric Turlan
  • Institution: IR Share / LISER

This profile describes the key characteristics of working life in Luxembourg.It aims to complement other EurWORK research by providing the relevant background information on the structures, institutions and relevant regulations regarding working life. This includes indicators, data and regulatory systems on the following aspects: actors and institutions, collective and individual employment relations, health and well-being, pay, working time, skills and training, and equality and non-discrimination at work. The profiles are updated annually.

Key figures

Key figures

Comparative figures on working life in Luxembourg

 

2011

2016

% (point) change
2011–2016

Luxembourg

EU28

Luxembourg

EU28

Luxembourg

EU28

GDP per capita

79300

25800

83700

26900

5.5%

4.3%

Unemployment rate – total

4.8

9.7

6.3

8.5

1.5

-1.2

Unemployment rate – women

6.0

9.8

6.6

8.7

1.5

-1.1

Unemployment rate – men

3.9

9.6

6.0

8.4

2.1

-1.2

Unemployment rate – youth

16.4

21.7

19.2

18.7

2.8

-3.0

Employment rate – total

67.9

71.1

70.0

73.0

2.1

1.9

Employment rate – women

60.7

64.8

64.7

67.4

4.0

2.6

Employment rate – men

75.0

77.5

75.1

78.6

0.1

1.1

Employment rate – youth

24.9

42.5

30.7

41.6

5.8

-0.9

Source: Eurostat - Real GDP per capita (chain linked volumes [2010], in EUR) and percentage change 2011-2016 (both based on tsdec100). Unemployment rate by sex and age - annual average, % [une_rt_a]; Employment rate by sex and age - annual average, % [lfsi_emp_a].

Background

Background

Economic and labour market context

Luxembourg’s economy remains one of most prosperous in the EU. Between 2011 and 2016, GDP growth was 5.5%, above the EU average for the same period (4.3%). Unemployment increased in all categories, the highest being for youth (2.8 percentage points). However, total unemployment rates remain below the EU average and stood at 6.3% in 2016, lower than the EU average (8.5%). Employment figures were slightly below the EU averages, but showed growth for youth (+5.8 percentage points) and women (4.0 percentage points) over the five-year period. 

More information on:

Legal context

The entire labour legislation regarding employers’ representation, trade union representation and collective bargaining is included in the Labour Code. There was a major change in the Labour Code in 2016 concerning working time regulation, where a temporary valid system of reference periods was replaced by definite ones and extended to up to four months under certain conditions and with certain constraints, or even up to 12 months by collective bargaining. Furthermore, the law reforming employee representation in company entered progressively into force in 2016 and a reform of parental leave came into force on 1 December 2016.

Industrial relations context

The concept of the ‘Luxembourg model’ is often referred to when social dialogue or labour relations within the Grand Duchy are discussed. The model is of a social dialogue organisation and culture capable of settling disagreements, and of bringing the main players from different backgrounds together in order to reach consensus on what measures will enhance the country’s economic and social well-being. This dimension continues to have great resonance among social dialogue players at every level. Another characteristic of Luxembourg’s social dialogue is its traditionally tripartite dimension, involving trade unions, employer organisations and the government. The state is regarded as a social partner in its own right. Most of the important agreements reached at national level – for example on inflation control, budget balance, corporate competitiveness and the labour market situation – are in fact negotiated by all three parties.

Up to 2010, the Luxembourg tripartite model was not questioned (Thill and Thomas, 2010). The first serious breach in tripartite dialogue happened in April 2010, when the Tripartite Coordination Committee announced the failure of discussions about the competitiveness of Luxembourg’s economy, employment policies and public finances. However, the government that has led the country since December 2013 has emphasised its commitment to social dialogue and aims to restore tripartite coordination. After signing a bilateral agreement with unions (in November 2014) and another with employer representatives (in January 2015), the government has been encouraging the social partners to return to the country’s former tradition of tripartite consultation (EurWork, ‘Luxembourg: Efforts to return to tripartism’, 13 May 2015). However, at national level, social dialogue was still slowing down in 2016 with no national tripartite bargaining on the agenda.

Actors and institutions

Actors and institutions

Trade unions, employers’ organisations and public institutions play a key role in the governance of the employment relationship, working conditions and industrial relations structures. They are interlocking parts in a multilevel system of governance that includes the European, national, sectoral, regional (provincial or local) and company levels. This section looks into the main actors and institutions and their role in Luxembourg.

Public authorities involved in regulating working life

The Ministry of Labour, Employment and the Social and Solidarity Economy has two areas of influence: policy covering employment, and labour law and industrial relations. The Ministry designs and directs policy, ensures its overall coordination and prepares legislation.

The Inspectorate of Labour and Mines (ITM) works under the authority of the Minister. Its role is to monitor working conditions and protect employees who have an employment contract, excluding administration officials.

The labour tribunal has a court magistrate who is the president of the court and two assessors where one is chosen from among the employers and the other from among the employees. The labour tribunal is competent in matters of employment contracts; apprenticeship contracts; supplementary pension schemes and insolvency insurance. The courts of appeal, which fall under the Supreme Court of Justice, are competent in matters of appeal against the rulings of the labour tribunal.

Health and Safety issues are mainly deal by the Department of Occupational Health (Division de la Santé au Travail) of the Ministry of Health. This department is responsible by law for the control and coordination of the functioning and organisation of occupational health services; it is also an appeal body for employers and employees in case of disputes about doctors’ opinions. It cooperates with the Inspectorate of Labour and Mines.

The Agency for the development of employment (Adem) is governed by the Minister of Labour (Labour Code, article L.621-1). Its competence extends throughout the territory of the Grand Duchy of Luxembourg. It has seven regional offices. A reform has been introduced in 2011 to help it to meet the challenges of the current economic and social context and be effective in helping jobseekers to find employment.

Representativeness

The Collective Employment Relationships Act of 30 June 2004 (Loi sur les relations collectives de travail) introduced and defined the criteria which determine the representativeness of a trade union (L. 161-3 and L. 161-4 LC). Thus, as soon as a trade union meets the legal criteria of representativeness, whether at national or sectoral level, it is entitled to conclude collective bargaining agreements. There are two ‘kinds’ of representativeness that can be at general national level (L. 161-4 and L. 161-5 LC), or at sectoral level in a sector that employs at least 10% of the private employees of the country (L. 161-6 and L. 161-7 LC). Unions are representative when they receive a minimum share of the votes within the Chamber of Employees (Chambre des salariés) at the latest social elections; 20% at national level or 50% within the sector. Article L-161-4 defines also the general national representativeness of a union in terms of its capacity to sustain a major labour dispute at national level.

There are no statutory regulations setting the criteria of representativeness for employer organisations. Their representativeness is based on mutual recognition.

More information on representativeness of the main social partner organisations can be found in Eurofound’s representativeness study of the cross-industry social partners or in Eurofound’s sectoral representativeness studies.

Trade unions

About trade union representation

Article 11 of the Luxembourg Constitution guarantees the freedom to join a trade union. The current legislation that applies to unions (based on the Law of 30 June 2004 that regulates labour relations) has been included in the Labour Code (article 161-3). Employees are organised on a voluntary basis into a number of trade unions whose principal aim is to negotiate collective bargaining agreements and to defend the interests of trades and professions. It is to be noted that unions are not implemented in companies or establishments, as the only existing employees’ representatives at this level are elected employees, although these representatives may be union members.

Trade union density in Luxembourg decreased from 42% in 2002 to 33% in 2012 (OECD). This net union density is above the EU average. Data provided by Statec are slightly higher (41% in 2010) as they cover only employees who are resident in Luxembourg, while OECDs data also cover cross-border employees whose union rate density is lower than for residents (Statec, 2011). The large number of services provided by unions can explain the relatively high level of union density, as unions provide help with matters such as legal assistance, coaching, and support for income tax declarations. The density is particularly high (over 60%) in public administration, education and transport sectors, but also in industry. It is quite low in sectors with a high rotation of employees such as the hotel-restaurant sector and in SMEs.

Luxembourg’s trade unions can claim a certain level of success in integrating the immigrant population. With the explosion in cross-border work in the 1980s and 1990s in particular, it was vital for the unions that they established themselves among employees who worked in Luxembourg but lived in neighbouring countries.

Trade union membership and trade union density

 

2010

2011

2012

2013

2014

2015

2016

Trade union density in terms of active employees

35%

34%

33%

n.a.

n.a.

n.a.

n.a.

Trade union membership in 1000

118.4

117.6

116.8

n.a.

n.a.

n.a.

n.a.

Source: OECD/Visser (2014), based on Administrative data on aggregate membership of main confederations organising blue and white collar employees, and independent unions of financial and managerial staff, clerical workers and white collar employees, private and public sector from trade union websites, EIRO and the European Trade Union Confederation. Active membership is estimated on the basis of Belgian data on membership among retired workers.

Main trade union confederations and federations

Luxembourg’s trade unionism is marked by structural pluralism. Two peak trade union confederations (LCGB, OGB-L) are recognised as nationally representative unions and are mainly active in the private sector. One other peak confederation is active in the public sector (CGFP). Important unions also exist at the sectoral level, such as Aleba for the bank and insurance sector which is recognised as representative at sectoral level.

Main trade union confederations and federations

Long name

Abbreviation

Members

Involved in collective bargaining

Trade Union Confederation of Luxembourg (Onofhängege Gewerkschaftsbond Lëtzebuerg)

OGB-L

72,000 (2016)

Yes

Confederation of Christian Unions in Luxembourg (Lëtzebuerger Chrëschtleche Gewerkschafts-Bond)

LCGB

41.000 (2016)

Yes

General Public Sector Confederation (Confédération Générale de la Fonction Publique)

CGFP

30,000 (2016)

No, but negotiate agreement with government that are assimilated to collective agreement.

Luxembourg Association of Bank and Insurance Employees (Association Luxembourgeoise des Employés de Banque et Assurance)

ALEBA

10,000

Yes

National Federation of Railroad Workers, Transport Workers, Civil Servants and Employees (Fédération nationale des cheminots, travailleurs du transport, fonctionnaires et employés, Luxembourg), commonly called the FNCTTFEL – Landesverband)

FNCTTFEL-Landesverband (cooperation agreement with OGB-L)

n.a

Yes

General Federation of the Municipal Administration (Fédération générale de la fonction communale)

FGFC

4,200

No

On 13 November 2013, 437,000 employees and retired workers were invited to vote to elect representatives at the Chamber of Employees and (active employees only) to elect staff delegations, which are similar to works councils, both held in Luxembourg every five years. Elections for staff delegations are organised in the companies while elections for the Chamber of Employees are organised on a national level on the basis of a vote by correspondence. The turnout was just 36% (approximately 158,000 people) for the Chamber of Employees’ election. For the workplace elections, just over 700 companies were involved. Compared with the previous election in 2008, votes for candidates not affiliated to a trade union increased by 3.37 percentage points and these candidates won 50.71% of the vote. Next was the OGB-L which won a slightly lower proportion of the vote (29.14%) compared to 2008 (30.66%). The LCGB came third with 14.11% of the vote (+1.33 percentage points in comparison to 2008). ALEBA received 4.73% of the vote. The next workplace election will be organised in 2019.

Employers’ organisations

About employers’ representation

Employers are organised on a voluntary basis into a number of professional federations, and in addition, there is a system of guild chambers. Affiliation to the Guild Chamber is mandatory for all private individuals or legal entities established in the Grand Duchy as a craftsperson. This is also the case for the Chamber of Commerce (Chambre de Commerce du Luxembourg, CDC), which is an institution of public law, encompassing all companies, except those in agriculture and the craft industry, which have their own guild chambers. At present, there are three chambers for employers: the Chamber of Commerce; Chamber of Trades (Chambre des Métiers); and the Chamber of Agriculture (Landwirtschaftskammer Luxemburg). Chambers have the statutory right to be consulted by the public authorities on all social and economic issues affecting their members’ interests. They also have the right to submit proposals for legislation. In certain policy areas, such as statistics and vocational training, they even function as public administrative bodies.

There have been no significant changes within employers' organisations in recent years. However, some important changes at the head of employers’ organisations occurred in 2014 (UEL, ABBL, Chambre de métiers) with a new generation of entrepreneurs. In 2013, about 61% of employees worked in a company in which there was at least one member of a professional organisation. 80% of employees work in company which is affiliated to an employer organisation.

Employers’ organisations - membership and density

 

2012

2013

2014

Source

Employers’ organisation density in terms of active employees

80%

80%

80%

Visser (2014)

Employers’ organisation density in private sector establishments*

n.a.

61%

n.a.

European company survey 2013

Percentage of employees working in an establishment which is member of any employer organisation that is involved in collective bargaining.

Main employers’ organisations

The peak employer confederation is the Union of Luxembourg Enterprises (Union des Entreprises Luxembourgeoises, UEL), representing private sector companies. UEL has eight members’ organisations (including the Chamber of Commerce and Chamber of Trades) covering about 28,000 employers and about 80% all employees. UEL was founded in 2000 as a result of formalising an existing liaison committee of sectoral business organisations. UEL signed the rare economy-wide agreements that mainly implement European framework agreements.

Within UEL, the main organisation is the Luxembourg Business Federation (Fédération des industriels luxembourgeois, FEDIL), which represents companies in construction, manufacturing and business services. FEDIL is affiliated to BusinessEurope and its members cover about 30% of national workforce.

There is no rivalry between the five main employers’ organisations as they operate in different sectors and cooperate closely since they are affiliated to UEL.

Main employers’ organisations and confederations

Long name

Abbreviation

Members

Year

Involved in collective bargaining

Union des Entreprises Luxembourgeoises

UEL

8 members’ organisations representing 35,000 employers

2017

Yes (1)

Fédération des industriels luxembourgeois,

FEDIL

550 companies

2017

No (2)

Association des Banques et Banquiers Luxembourg,

ABBL

138 companies

2017

Yes

Association des Compagnies d’Assurance

ACA

83 companies

2017

Yes

Confédération Luxembourgeoise du Commerce

CLC

58 members’ organisations

2017

No (2)

Fédération des Artisans

FDA

53 members’ organisations

2017

No (2)

Fédération Nationale des Hôteliers, Restaurateurs et Cafetiers

HORESCA

n.a.

2017

No

Centrale paysane luxembourgeoise

CPL

2,500 employers

2017

No

(1) Only collective bargaining to implement some EU directives.
(2) No, only a few sectoral federations affiliated to the employer’s organisation but not the organisation as a whole.

Tripartite and bipartite bodies and concertation

The ‘Luxembourg social model’ is characterised by tripartite consultation, which brings together the government, representatives of employers and of workers.

It was introduced in the 1970s, at a time when it was necessary to reorganise the iron and steel industry and deal with social problems. This tripartite model kept thousands of steel workers from becoming redundant, made the steel industry fit for the global economy and introduced social policy measures aimed at keeping the unemployment rate very low. Since 1977, the ‘Tripartite Coordination Committee’ (Comité de coordination tripartite) has been used several times by the government to get consensus on crucial reforms (for example, the first National Action Plan on Employment in the framework of the European Employment Strategy in 1998, and the introduction of the unique working status in 2006).

The economic and financial crisis of 2008 altered the tripartite model fundamentally, because the deterioration of public finances implied that employers and employees had to take more of the burden. Moreover, trade unions and employer organisations disagreed on the causes of the crisis and wanted different solutions. Employers wanted to reinforce competitiveness by reducing costs, whereas trade unions wanted to strengthen economic demand. The economic crisis led to the failure of tripartite dialogue in 2010. In 2015, after signing a bilateral agreement with employer representatives, and another with unions, the Luxembourg government has been encouraging the social partners to return to the country’s former tradition of tripartite consultation.

The Economic and Social Council (Conseil économique et social) plays a role of cooperation and consultation along with the Conjuncture Committee. The government consults the committee on projects aimed at changing legislation or regulations that affect different sectors or the whole national economy. The government may also consult the committee on specific issues to obtain its advice. The committee also coordinates the involvement of social partners within the EU Semester consultation process. Other tripartite bodies are: the Permanent Committee of Labour and Employment (Comité permanent du travail et de l’emploi), the Women’s Labour Committee (Comité du travail féminin) and the Observatory of Industrial relations and Employment (Observatoire des relations professionelles et de l’emploi, ORPE) under the umbrella of the Ministry of Labour.

Main tripartite and bipartite bodies

Name

Type

Level

Issues covered

Tripartite Co-ordination Committee (Comité de coordination tripartite)

Tripartite

National

Search for consensus on economic and social issues

Permanent committee for labour and employment (Comité Permanent du Travail et de l’Emploi - CPTE)

Tripartite

National

Employment, working condition, health and safety

Economic and Social Council (Conseil Economique et Social - CES)

Tripartite

National

Consulted and provides advice on any legislative or regulatory action relating to professional sectors and the entire national economy.

Economic Committee (Comité de conjoncture)

Tripartite

National

The situation of companies forced to resort to short-time working arrangements and to propose, if needed, compensatory payments to companies resorting to short-time work.

Workplace-level employee representation

The main channel for employee representation at workplace level is the Staff Delegation (délégations du personnel/Personal-ausschuss), which is directly elected by all employees in companies with more than 15 employees (Labour Code, article 414-4). In companies employing more than 150, employees are also represented by joint works councils (JWC – Betriebsrot) or joint committees (‘Comités mixte’). In establishments that are part of the same enterprise, a central delegation is established.

The law of 23 July 2015 to reform social dialogue within companies, which was adopted in July 2015, has changed this regulation. From the next round of workplace election, in 2019, the staff delegation becomes the single body representing the interests of the employees and is granted the powers of the joint committee, particularly with regard to codetermination, once the threshold of 150 employees is exceeded. The employees’ representatives are elected for five years. The number of employees’ representatives depends on the number of employees in the company (Labour Code, article 412-1).

Staff delegation

The staff delegation is there to ‘safeguard and defend the interests’ of employees. It makes every effort to prevent and mitigate any individual and collective conflict(s) that could emerge between the employer and the workforce. The staff delegation can, in the absence of any conflict resolution, refer to the Labour and Mines Inspectorate any complaint or observation relating to the application of the legal, regulatory, administrative or contractual provisions (such as those laid down in a collective agreement) that affect the working conditions and protection of employees at their workplace. Article L. 414-4 (Labour Code) enumerates the mandatory topics which have to be submitted to the Staff delegations for information and/or consultation and provides for some formal requirements.

According to the Labour Code, the management is obliged to inform the staff delegation (and the equality delegate) about the structure and the situation of the undertaking (or establishment) as well as the probable evolution of its activities. This information should be provided during meetings with the management of the establishment (see Labour Code article L. 414-4).

The employees’ representatives are elected every five years (through elections called ‘élections sociales’) by all employees at the workplace. They can be nominated by the unions or by at least 5% of the total number of employees. The last elections were held in November 2013.

The legislation envisages a minimal number of meetings for the staff delegation (three a year).

The new law makes the delegation the only body that will represent employee interests, fulfilling functions such as presenting complaints or suggestions to companies on issues such as working safety, part-time work, harassment and training. The size of the delegation depends on the number of employees at the company, ranging from one member for a company that has 15–25 employees, to 25 members for companies with between 5,101 and 5,500 employees.

Staff delegates will benefit from increased paid leave and more time for training to fulfil their duties. In companies with at least 250 employees, some delegates (délégués libérés) will be exempted entirely from work to fulfil their staff representation duties. The employer will provide the delegation with information about the company, including developments of its activities, its financial outlook, and foreseen changes in its employment situation. In companies with at least 150 employees, this will either happen once a month, or at the request of the delegation; in smaller companies, at least annually. Staff delegations will have co-decision rights of the past joint company committee (see below) and additionally, on vocational training issues (Labour Code, article L. 414-2). The staff delegation in companies with fewer than 150 employees have no co-decision rights on these topics, but they are informed and consulted, and they do not have to agree with the employer.

Furthermore, in companies with at least 51 employees (instead of 150 employees before the reform), staff delegates will have increased opportunities to seek the advice of external counsellors or have experts to assist them on technical matters. The employer will pay the experts’ fees. Another innovation is the right to use mediation in the event of disputes about the application of the Labour Code in relation to staff delegations.

Joint company committee

The joint committee, that will be abolished and replaced progressively by the reform of 2015 (see above), has an equal number of employee representatives (appointed by secret ballot) and employer representatives (appointed by the head of the company), according to the size of the workforce employed. The role of the joint company committee is to provide a forum in which employer and employees can work together to improve industrial relations in the workplace. Among other topics, the joint company committee has to be informed and consulted on changes affecting the workplace (such as construction, extension, new production processes) (Labour Code article L. 423-1). There are some issues on which the joint company committee itself decides. These are:

  • the introduction of equipment intended to monitor the behaviour or the performance of employees (such as closed circuit cameras);
  • measures linked to workplace health and safety;
  • general criteria for recruitment, promotion or redundancy; criteria for employee appraisal;
  • workplace regulations;
  • pay-outs from workplace suggestion schemes.   
 

Regulation

Composition

Competences of the body

Involved in company level collective bargaining?

Thresholds/rules when they need to be/can be set up

Délégation
du personnel / Personal-ausschuss
(Staff delegation)

By law

Employees’ representatives elected every five years

Yes

Need to be set in companies with more than 15 employees.

Joint Works Council/ Betriebsrot

 

By law

Employees’ representatives elected every five years and employers’ representatives.

Yes

Need to be set in companies employing more than 150 employees.

Employee representation at establishment level

In the figure, we see a comparison between Luxembourg and European Union for the people with 'Establishment size : All' when asked 'Official structure of employee representation present at establishment'. For the 'Yes' answer, Luxembourg's score is higher than the European Union score. For the 'No' answer, Luxembourg's score is lower than the European Union score. The National comparisons visualisation presents a comparative overview for the values of all answers between two selected countries.

Source: ECS 2013. Private sector establishments with more than 10 employees. Eurofound data visualisation.

Collective bargaining

Collective bargaining

Bargaining system

The collective agreement enables the regulations of the labour laws to be adapted to the needs and specific requirements of a company or a sector. Any collective agreement must be negotiated between social partners according to certain formalities and filed with the Inspectorate of Labour and Mines (Inspection du Travail et des Mines - ITM) for approval by the Minister of Labour and Employment. There are two types of collective agreements:

  • standard collective agreements negotiated between an employer or a group of businesses (or their representatives) and a trade union. They are legally binding between signatories.
  • collective agreements extended by a grand-ducal regulation and which are applicable to all employers and employees of the profession concerned.

The most important levels for negotiations are at sectoral and company level. The relative importance of the two levels of agreement varies from sector to sector. Sectoral agreements exist, for example, in sectors such as banking, insurance, private security, the construction sector and all the related crafts as well as in the hospital and social sector. Their single-industry agreement covers 100% of the workforce (see representativeness studies for banking, insurance and private security) as are extended by the Ministry of Labour. However, many sectors have no industry-level agreements. In 2010, 59% of all employees had their terms and conditions of employment regulated by collective bargaining (Ries, 2013), which is quite high despite the high level of decentralisation of collective bargaining and the weakness of collective bargaining in some sectors. Unless stipulated otherwise in the collective agreement, senior management is not concerned by the working and salary conditions established in the collective agreement which applies to the staff. The following are considered to be senior management:

  • employees whose salary is significantly higher than the salaries paid to the staff covered by the collective agreement;
  • where the salary forms the counterpart in exchange for a true and effective power of management;
  • employees who benefit from independence in the organisation of their work and a large flexibility in their working hours.

Wage bargaining coverage

There is no national collective bargaining on wages. Luxembourg is characterised by the prevalence of company-level collective agreements over sectoral-level agreements. However, there is a mechanism of wage indexation. Salaries and wages (including the minimum wage) are adjusted in line with the cost of living. When the consumer price index increases or decreases by 2.5% during the previous quarter, salaries are normally adjusted by the same proportion. The consumer price index and its impact on the sliding wage scale are published monthly by the national statistics body (Statec). The employer must increase all wages by 2.5%. Sectoral collective agreements may include salary rates linked to grade and coefficient. At company level, collective agreements on wages are often concluded for 12 to 24 months.

Collective wage bargaining coverage of employees at different levels

Level

 

Source

All levels

73%

2013 – ECS

All, excluding national level

66%

2013 – ECS

All levels

63%

2010 – SES

All levels

59%

2010 – Statec

Sources: Eurofound, European Company Survey 2013 (ECS), private sector companies with establishments >10 employees (NACE B-S) – multiple answers possible; Eurostat, Structure of Earnings survey, companies >10 employees (NACE B-S), single answer: more than 50% of employees covered by such an agreement.

The latest national data about collective bargaining coverage were published in 2013 and refer to 2010. The collective bargaining coverage was estimated at 59% of the workforce, with a large difference between the public sector (100%), education (87%) and social and care activities (87%), and some activities in the private sector such as hotel and restaurant (12%) or technical and scientific activities (13%). The coverage rate differs with the size of the companies, from 30% (10 to 49 employees) to 79% (over 1,000 employees). The global rate includes the public sector and is based on the EU Structure of earnings survey (SES), in contrast to the data provided by the European Company Survey (see table), which focus on companies of the private sector with more than 10 employees.

Collective bargaining coverage – national data

 

2010

2013

2014

2015

2016

Source

All levels

59%

n.a.

n.a.

n.a.

n.a.

Statec (2013), Regards ‘sur la couverture des conventions collectives de travail’ [on the coverage of collective labour agreements], Regards, No. 06/2013, Statec, Luxembourg

Bargaining levels

Intersectoral agreements are rare and never cover issues such as wages or working time. They mainly implement EU-wide agreements concluded by social partners, such as telework or harassment at the workplace. The most important levels for negotiations are at the sectoral and company level. Sectoral-level agreements initially apply only to those companies that belong to the employers’ associations which have signed the agreement, but are often extended by the government to the entire sector – 27 are currently extended in this way, according the labour inspectorate (ITM, ‘Conventions collectives de travail déclarées d'obligation générale’).

There are many more company-level agreements dealing with wages than sectoral-level agreements. In 2015, the Labour inspectorate registered 114 company agreements (including 55 only in the industry) compared with 8 sectoral-level agreements (ITM, Annual report, 2015).

The relative importance of the two levels of agreement varies from sector to sector. Sectoral agreements exist, for example, in sectors such as banking, insurance and private security. Their single-industry agreement covers close to 100% of the workforce (see representativeness studies for banking, insurance and private security). However, many sectors have no industry-level agreements.

Levels of collective bargaining 2016

 

National level (Intersectoral)

Sectoral level

Company level

 

Wages

Working time

Wages

Working time

Wages

Working time

Principal or dominant level

           

Important but not dominant level

   

x

x

x

x

Existing level

           

Articulation

The question of articulation is quite theoretical in Luxembourg as where a sectoral collective agreement exists, then it is extremely rare to find a company with its own company-level collective agreement. Therefore, collective agreement of both levels have rarely to be articulated. However, if the two levels of collective agreement exist, then the principle of favourability towards higher level agreements applies. Company-level agreements may not provide lower employment and wage conditions than sectoral-level agreements. If collective agreement provisions are worse than the legal minimum required or limit rights provided by a sectoral-level agreement, they are declared null and void and have no effect.

Timing of the bargaining rounds

There are no major bargaining rounds at national level. Collective bargaining on wages exists in some sectors and at company level with various periods. In the banking sector and insurance sector, social partners generally conclude collective agreements for a period of three years. At company level, wage collective agreements are often concluded for shorter periods.

Coordination

The most important form of wage coordination is the wage indexation mechanism. In April 2006, social partners and the government decided in the Tripartite coordination committee to ‘modulate’ the application of the wage indexation mechanism for the period 2006–2009. The modulation postponed the periodic adjustment of wage levels in line with inflation by up to seven months. This was justified by concerns over economic competitiveness following the rapid increase in oil prices. During this period, wages increased by less than general prices. Other than that, there is no coordination of wage bargaining, neither vertically nor horizontally.

Extension mechanisms

Sectoral collective agreements initially cover only those companies that belong to the employers’ associations which have signed the agreement. However, social partners nearly always ask the government to extend them to the entire sector. In May 2017, there were 27 sectoral collective agreements that were likely to be extended in this way (ITM, ‘Conventions collectives de travail déclarées d'obligation générale’). There are no other voluntary mechanisms of extension or application of the terms of collective agreements.

Derogation mechanisms

There is no possibility to derogate from collective agreements in order to pay wages below the collectively agreed level. Derogation is possible only above the collectively agreed level.

Expiry of collective agreements

In order to denounce a collective agreement (always concluded for a fixed term), in part or in its integrity, the social partners must request its termination by respecting the notice period established in the collective agreement (a maximum three-month notice period). Then parties must open new negotiations, which must in any case begin at the latest six weeks before the agreement or the provisions to be renegotiated come to term. The terminated collective agreement stops being valid as soon as a new agreement enters into force or, at the latest, on the first day of the twelfth month following the termination request, but social partners may agree on new deadlines. If there has been no request for termination of the collective agreement (or some of its dispositions) before its end date, it will be extended for an undetermined period of time. It may be subsequently terminated while respecting the notice period set out in the agreement.

Other aspects of working life addressed in collective agreements

On the national level, a limited number of intersectoral agreements have been signed on issues such as telework or harassment at the workplace. The national level is, moreover, very important for the coordination of wage-setting mechanisms (through the minimum wage and the wage indexation mechanism).

At sectoral level and company level, the main issues discussed relate to wages and working conditions. More original and innovative issues do not seem to be broadly discussed or lead to meaningful results. However there have been some ‘innovative’ sectoral-level agreements; an agreement on harassment in the banking sector (2014), one on improvement of employability in the health sector (2012), and another on parental leave and education leave in the health-care and social assistance sector (2013).

However, in the absence of longitudinal and in-depth studies on the content and dynamics of collective bargaining, it is difficult to make a precise assessment. The existing reports do all cover narrow domains of collective bargaining (working time, female-male equality, training) and do not offer a broad, in-depth assessment. This is also related to the fact that company level agreements are generally not publicly accessible.

Industrial action and disputes

Industrial action and disputes

Legal aspects

In Luxembourg, the right to strike is based on a judicial interpretation (Supreme Court ruling of 1952) of the concept of freedom of collective industrial organisation as enshrined in Article 11(4) of the Constitution. The right to commence strike action is subject to the observance of preliminary conciliation procedures. Every industrial dispute arising in one enterprise must be referred - before any stoppage or cessation of work - to the National Conciliation Office. When all possibilities of conciliation have been exhausted, the joint conciliation committee formed within the service draws up a memorandum stating the points still in dispute. Over the next two weeks, one of the parties may refer the dispute to an arbitration by a chairperson nominated by the Government. The decision must be accepted and this is then equivalent to the conclusion of a collective agreement. Otherwise, if attempts at conciliation and arbitration have proved unsuccessful, strike action may be initiated quite lawfully, and an employee's participation in such a strike does not constitute grounds for dismissal. Furthermore, the right to strike is forbidden during the validity of a collective agreement. Apart from strikes, which are extremely rare in Luxembourg, other industrial disputes consist mainly of demonstrations.

Incidence of different forms of industrial action 2010–2013

Work-to-rule or refusal to do overtime

2%

Work stoppage or strike for less than a day

2%

Strike of a day or more

0%

Blockade or occupation

0%

Percentage of private sector establishments reporting any form of Industrial action during the indicated period.

Source: European company survey

Dispute resolution mechanisms

Collective dispute resolution mechanisms

The industrial relations culture is based on trust and discussion between social partners. A report by CEPS-INSTEAD (Rey, 2010) stresses the low level of industrial dispute in Luxembourg. All the four studies quoted by CEPS-INSTEAD show an absence of collective action and strikes. The study explains that this ‘social peace’ is the result of various means of dispute resolution, such as conciliation under the umbrella of the National Conciliation Office (Office National de Conciliation, ONC) (see above). Outside the procedure to be observed for strike, two other conciliation processes exist, one for disputes related to the application of the collective agreement, the second in the case of disputes about working conditions. During the process, the party must avoid any action such as lock-outs or strikes that could endanger the conciliation process. At the end, the committee can propose a decision that is equivalent to the conclusion of a collective agreement if it is accepted, or a conciliation proposal. If the conciliation fails, the committee will observe the non-conciliation.

Since 2009, between six and a dozen disputes in the context of collective bargaining were brought each year before the ONC.

Individual dispute resolution mechanisms

The employer and an employee may ask the Labour inspectorate to resolve an individual industrial dispute. If the parties agree to accept the recommendation resulting from conciliation, than the dispute is considered resolved (L.652-1 LC). However such initiatives are rare and no data are available.

Individual employment relations

Individual employment relations

Individual employment relations are the relationship between the individual worker and their employer. This relationship is shaped by legal regulation and by the outcomes of social partner negotiations over the terms and conditions governing the employment relationship. This section looks into the start and termination of the employment relationship and entitlements and obligations in Luxembourg.

Start and termination of the employment relationship

Requirements regarding an employment contract

According to the Labour code (article L. 121-4), it is compulsory to conclude a contract in writing, detailing the nature and conditions of the work relationship either before or on the first day of employment. The minimum working age is 16 years old. There are restrictions on the employment of young workers under 18 years old.

An employer recruiting a new employee in response to a lasting need for personnel as part of the normal and permanent activity of the business generally must conclude a permanent employment contract (contrat à durée indéterminée - CDI) with the employee. The employer can only use fixed-term contracts (contrat à durée determine - CDD) in exceptional cases in response to isolated needs of the business, according the Labour Code (L. 122-1 LC).

Dismissal and termination procedures

The provisions regarding the termination of employment contracts and protection against dismissal are contained in the Labour Code. However, some collective agreements may provide greater protection against dismissal than that provided by law.

There are four different types of termination of a permanent employment contract: dismissal with notice, dismissal without notice for gross misconduct, resignation and termination by mutual consent

Any employer employing at least 15 people must notify the Comité de Conjuncture of any termination/redundancy taking place for reasons not linked to the employee’s aptitude or attitude. Such notification must be given at the latest when the employee is notified of the termination.

Any employer with 150 employees or more who contemplates dismissing any employee must, before reaching any decision, interview the employee concerned.

All categories of workers are protected against dismissal, in the sense that their employment relationships may only be terminated in accordance with the specific provisions of employment legislation. If the employer wants to dismiss an employee, a letter of notice of dismissal must be sent by registered mail.

Certain employees or categories of employees benefit from specific additional legal protection as employees’ representatives.

See also further information on unemployment benefit provisions in Luxembourg.

Entitlements and obligations

Parental, maternity and paternity leave

Parental leave reform was enacted in 2015 and comes into force in 2016. The law of 3 November 2016 reforming the system of parental leave (in French) entered into force on 1 December 2016. Its aim is to improve work–life balance and to encourage parents in general and fathers in particular to make greater use of parental leave. Both parents will be able to take parental leave until the child is 6 years old (instead of 5 years old under the previous system).

Statutory leave arrangements

Maternity leave

Maximum duration

Eight weeks of pre-natal leave + eight weeks of postnatal leave (extended to 12 weeks if the employee is breastfeeding, or in the case of premature or multiple births).

Reimbursement

For a salaried worker: the highest salary received during the three months prior to maternity leave, and, where applicable, the average of complementary and other benefits received during the 12 months preceding the month prior to the start of maternity leave. Financial maternity benefits cannot be lower than the social minimum wage, i.e. gross amount of €1,998.59 a month as of 1 January 2017; or higher than 5 times the social minimum wage, i.e. gross amount of €9,992.95 a month as of 1 January 2017.

Who pays?

National Heath Fund (Caisse Nationale de Santé – CNS)

Legal basis

- Labour Code, Art. L. 332-1. Art. L. 332-2.

- Social Security Code; L.25

Parental leave

Maximum duration

Those entitled to parental leave can now choose from several options, depending on the number of hours’ work provided for in their contract of employment. For a person employed full time (40 hours per week), there are four possible options: 1) Full-time leave for 4 or 6 months. 2)Part-time leave for 8 or 12 months. 3) Fragmented leave: 4 months taken over a maximum period of 20 months. 4) Fragmented leave: a 20% reduction in the weekly hours worked (for example, 1 day per week) for a maximum of 20 months.

Reimbursement

Under the new system, the parental leave allowance, previously paid at a fixed rate of €1,778 per month, becomes a replacement income that is paid pro rata to the income earned by the parent taking parental leave. The allowance cannot be less than the minimum wage (social minimum wage), which on 1 January 2017 was €1,998.59 for a full-time (40 hours) employment contract, and its upper limit will be €3,330.98 (5/3 of the minimum wage).

Who pays?

Caisse pour l’avenir des enfants (Zukunftskees)

Legal basis

Loi du 3 novembre 2016 portant réforme du congé parental (Law of 3 November 2016 on the parental leave’s reform).

Labour Code, article L. 234-43 to L. 234-56

Paternity leave

Maximum duration

Two days (Four for public servants)

Reimbursement

100% of employee’s salary.

Who pays?

Employer

Legal basis

Labour Code, article L. 233-16

Special leave for family reasons

Maximum duration

May not usually exceed two days a year for each child under 15 years

Reimbursement

100% of employee’s salary

Who pays?

Employer

Legal basis

Labour Code, article L. 234-50

Sick leave

The Labour Law defines the obligations of the sick employee as well as his or her rights (LC, article L 121-6). Social security legislation (Book I of the Social Security Code) regulates the sickness and maternity insurance scheme.

  • An employer must continue to pay his employee in case of sick leave due to illness or an occupational accident and must do so until the end of the month during which the 77th day of sick leave occurs, during a reference period of 12 successive months – the principle of ‘continuation of pay’ (Lohnfortzahlung, LFZ).
  • As from the month following the 77th day of sick leave, the National Health Fund (Caisse Nationale de Santé - CNS) takes over from the employer and pays sickness benefits to the employee on sick leave. From this point on, the employer no longer has to pay a salary to the employee while benefits from the CNS are being paid.

Retirement age

Since reforms introduced in 1996 and 1998 (Création de l’assurance pension au Luxembourg, Ministry of social security, 2013), the pension public system covers all individuals economically active in the public and private sector. The pension scheme comprises invalidity, retirement and survivor pensions. In the framework of the reform of the single statute in 2008 (Loi du 13 mai 2008 portant introduction d'un statut unique) aiming to merge the statute of ‘worker’ with the statute of ‘employee’, a single pension scheme was created for the whole private sector, the National Fund of Pension Insurance (Caisse nationale d’assurance pension - CNAP).

The retirement benefit is based on two components: a flat-rate amount contingent on years of coverage and an earnings-related amount. The pension system is financed through contributions shared equally between the employer, employee and the state. The rate, half of which is payable by the employer and half by the employee, amounts to 16% of assessable income. The State also makes a contribution, amounting to a further 8% of total assessable income (Pension schemes and projection models in EU-25 member states, EC November 2007). The statutory retirement age is 65. An early retirement scheme also exists after 40 years of contributions that allows an individual to claim pension from age 57. However the law of 21 December 2012 (in French) on pension reform entered into force on 1 January 2013. It introduced changes to ensure the sustainability of the public pension system, reducing the attractiveness of early retirement and changing the calculation of the pension.

Occupational system

Companies may offer their employees a pension, choosing between three types of plans: pension funds, group insurance, or book reserve schemes. As reported by the OECD, ‘pension funds may be established as Sociétés d’épargne-pension à capital variable (SEPCAVs), Associations d’épargne-pension (ASSEPs) or other types of pension funds. The SEPCAV is similar to an investment trust, while the ASSEP is a new type of company inspired by mutual insurance associations and organised like a partnership’ (OECD Private pensions outlook 2008).

Voluntary occupational pension plans can be defined benefit or defined contribution in nature, or a hybrid of the two. According to the OECD, in 2006, ‘approximately half of all privately managed pension funds financed defined benefit plans and the other half defined contribution schemes. However, defined benefit plans, which are typically linked to final salary earnings, covered approximately 87% of pension plan members’.

Pay

Pay

Pay: For workers, the reward for work and main source of income; for employers, a cost of production and focus of bargaining and legislation. This section looks into minimum wage setting in Luxembourg and guides the reader to further material on collective wage bargaining.

Minimum wages

In Luxembourg, the mechanism of wage indexation means that salaries and wages are adjusted in line with the cost of living. When the consumer price index increases by 2.5% during the previous quarter, salaries are normally adjusted by the same proportion. The consumer price index and its impact on the sliding wage scale are published monthly by Statec. The employer must increase all wages by 2.5%. However, in response to and during the economic crisis, the adjustment has been made only once a year (on 1 October) in 2012, 2013 and 2014.

On 1 January 2017, the statutory minimum monthly wage reached €1998.59 (€11.55 an hour) for employees over 17 years old. Qualified employees over 18 years old receive 120% of the national minimum wage (€2,398.30).

The full minimum wage is paid from the age of 18 years. Employees aged between 17 and 18 years receive 80% of the full rate (€1,598.87 since 1 January 2017). Employees aged between 15 and 17 years receive 75% of the full rate (€1,498.94 since 1 January 2017).

For more information regarding the level and development of minimum wages, please see Eurofound’s topical update on statutory minimum wage in the EU 2017 or visit Eurostat.

Collectively agreed pay outcomes

For more detailed information on the most recent outcomes in terms of collectively agreed pay, please consult Eurofound’s collectively wage bargaining portal.

Working time

Working time

Working time: ‘Any period during which the worker is working, at the employer’s disposal and carrying out his activities or duties, in accordance with national laws and/or practice’ (Directive 2003/88/EC). This section briefly summarises regulation and issues regarding working time, overtime, part-time work as well as working time flexibility in Luxembourg.

Working time regulation

According to the Labour Code, standard work time for employees is eight hours a day and 40 hours a week. Collective agreements can only stipulate more favourable provisions.

By law, the employer may determine a reference period (usually one month) during which working time may be subject to flexibility. To do this, the employer must set up either a working hours plan (plan d'organisation du travail - POT) or flexible working hours (flexitime).

Before implementing the working hours plan, the employer must consult with the staff delegation or, if there is no delegation, with all the staff concerned. If the employer's proposal is refused twice in a row, the employer may refer the case to the Inspectorate of Labour and Mines (ITM) to reach an agreement.

Maximum working hours cannot exceed 10 hours a day or 48 hours a week. The employer must also grant minimum rest periods to his employees of 11 consecutive hours within each 24-hour period, and at least one rest period of 44 consecutive hours within each 7 day period. Where the daily work time exceeds six hours, each salaried worker is entitled to at least one rest period, whether paid or not.

The Law of 23 December 2016 on the organisation of working time that entered into force on 1 January 2017 has increased working time flexibility (see below).

For more detailed information on working time (including annual leave, statutory and collectively agreed working time), please consult Eurofound’s report on Working time developments in the 21st century: Work duration and its regulation.

Overtime regulation

If overtime is worked, the maximum working time cannot exceed 10 hours a day or 48 hours a week. Any working time exceeding the normal working time (40 hours a week or 40 hours a week on average within the reference period) is considered as overtime.

In order to benefit from an increase in normal working time, the employer must notify any overtime being worked to the Inspectorate of Labour and Mines (Inspection du Travail et des Mines – ITM).

The employer must also send a statement of hours worked to the ITM at the end of each authorised period.

Before any overtime is worked the employer must:

  • consult the staff delegation or, failing this, the employees involved in working overtime;
  • send an overtime notification to the ITM.

In principle, the employer must compensate any employees who work overtime by granting them 1.5 hours off for every hour of overtime worked. This time off in lieu may be, at the employer's discretion, either taken as compensatory time off or put into a time savings account. The employer is free to choose between these two types of compensation. Exceptionally, payment may be made to the employee for overtime worked at a rate of 1.4.

Part-time work

Part-time work is regulated by law. Labour Code (article L. 123-1) considers part-time work as less than 40 hours a week or less than the weekly working time set out in collective agreements.

Even if part-time employees have a work schedule inferior to the standard work schedule, they can nevertheless work more than the daily and weekly hours stipulated in the contract, provided that:

  • the weekly work schedule calculated over a 4-week reference period does not exceed the duration of weekly working hours stated in the contract, and;
  • the actual daily and weekly working time does not exceed the standard daily and weekly working time stated in the contract by more than 20%.

Any employer wishing to recruit an employee on a part-time basis must conclude an employment contract either before or on the first day of work. The contract must respect certain obligations regarding form and content. Such a contract can either be a permanent contract or a fixed-term contract. In addition, it is subject to specific legal provisions. Part-time employees must have the same rights granted to full-time employees under the applicable law or collective agreement.

About 18.9% of the workforce was employed part time in 2016 in Luxemburg, the same share as in the EU average figures. Part-time employees are mainly female, but since 2011 the rate of female employed part time in Luxembourg as a percentage of total employment decreased from 35.7% to 34.6%, still over the EU average of 31.4 in 2016, but in the same period the rate of men employed part time increased from 4.1% to 5.9 – below the EU average of 8.2 in 2016.

Persons employed part-time in Luxembourg and EU28 (% of total employment)

 

2011

2012

2013

2014

2015

2016

Total - EU28

18.2

18.6

19.0

19.0

19.0

18.9

Total – LU

17.9

18.3

18.4

18.2

17.8

18.9

Women - EU28

31.0

31.4

31.8

31.7

31.5

31.4

Women – LU

35.7

35.7

35.7

35.2

33.2

34.6

Men - EU28

7.4

7.7

8.1

8.2

8.2

8.2

Men - LU

4.1

4.3

4.7

4.3

5.1

5.9

Source: Eurostat Labour Force Survey [lfsi_pt_a] – Persons employed part-time (20 to 64 years of age) – total and by sex.

Night work

According to the Labour code (article L. 211-14), night work (between 22.00 and 6.00) is not prohibited, nor subject to authorisation. However, the employer must ensure that the normal working time for night workers does not exceed 8 hours on average per 24-hour period calculated over a 7-day period. The employer only has to make additional payments for night work: 15% minimum for all sectors if a collective agreement is applicable (the exact rate of the increase is thereby set by this agreement); or 25 % from 01.00 in the morning in the hotel and catering sector.

Shift work

There is no legal definition of shift work but the European Working Time Directive stipulates that shift work designates ‘any method of organising work in shifts whereby workers succeed each other at the same work stations according to a certain pattern, including a rotating pattern, and which may be continuous or discontinuous, entailing the need for workers to work at different times over a given period of days or week’.

Weekend work

In principle, Sunday work (from midnight to midnight) is prohibited for all employees and apprentices. But it is authorised for certain categories of employees, in certain sectors of activity and for certain specific tasks which cannot be carried out during the week.

The employer has to send a notification to the Labour inspectorate. Each time an employee works on a Sunday, the employer must grant him either his standard hourly pay and a 70% premium for each hour worked, or compensatory rest and the 70% premium for each hour worked.

Rest and breaks

Where the daily work time exceeds 6 hours, each salaried worker is entitled to one or more rest periods, whether paid or not. However, the law doe not stipulate the length of the rest period. The daily rest period is 11 uninterrupted hours. Each employee is entitled to a weekly rest period of 44 uninterrupted hours that should include the Sunday.

Working time flexibility

As mentioned, standard work time for salaried workers is eight hours a day and 40 hours a week. The employer may, after having consulted the staff delegation, determine a reference period during which work time may be subject to flexibility. In this case, the employer must set up either a working hours plan (plan d'organisation du travail - POT) or flexible working hours (flexitime). In both cases, it is necessary to determine a reference period before setting up a working hours plan (POT) or flexitime.

The Law of 23 December 2016 on the organisation of working time entered into force on 1 January 2017. Its key measure is to enable employers to extend the reference period used to calculate the duration of work from one to four months, in exchange for supplementary leave for employees. An employer can thus decide to extend the reference period without having to negotiate an agreement with the trade unions. The maximum length of weekly working time reach, depending the duration of the reference period, 44 or 45 hours for employees working 40 hours per week. But the law provides some compensation: employers must allocate additional leave days to employees based on the duration of the reference period: from 1.5 days for a reference period of between one and two months, up to 3.5 days for a reference period of between three and four months. Furthermore, an employee must be informed three days before any change of its working time schedule. However, as before, the social partners may negotiate a collective agreement to extend the reference period up to 12 months, and negotiate compensation that is appropriate to the needs of the business and the employees.

Flexitime (horaire mobile): Flexible working hours allow salaried workers to organise their daily working hours and time on an individual basis in accordance with their personal needs as long as they respect operational needs, co-workers’ reasonable needs, and the maximum working time allowed (10 hours a day and 48 hours a week).

According to the law of 23 December 2016, the decision to establish flexitime, as well as its periodicity, content and modalities, including amendments, shall be taken in the framework of a collective agreement or by mutual agreement between the employer and the staff delegation or, failing that, the employees concerned (Labour code, art. L. 211-8).

The possibility for employees to adapt the start and end of their working day according to their personal needs is quite limited in small companies (41%) but exceeds the half of the workforce in companies with over 250 employees (54%).

Do you have fixed start and finishing time in your work?

In the figure, we see a comparison between Luxembourg and European Union for the workers with 'Age : All' when asked 'Do you have fixed starting and finishing times in your work?'. For the 'No' answer, Luxembourg's score is lower than the European Union score. For the 'Yes' answer, Luxembourg's score is higher than the European Union score. Data is based on question 39d from the sixth European Working Conditions Survey (2015). The National comparisons visualisation presents a comparative overview for the values of all answers between two selected countries.

Source: Eurofound’s European Working Conditions Survey 2015.

More detailed figures are available from Eurofound’s European Working conditions survey.

Health and well-being

Health and well-being

Maintaining health and well-being should be a high priority for workers and employers alike. Health is an asset closely associated with a person’s quality of life and longevity, as well as their ability to work. A healthy economy depends on a healthy workforce: organisations can experience loss of productivity through the ill-health of their workers. This section looks into psychosocial risks and health and safety in Luxembourg.

Health and safety at work

The number of accidents at work has been quite stable since 2010 with 6,154 accidents registered in 2014 (+0.6% in comparison to 2013). A drop was observed in 2009, which might be partly due to the crisis: its impact was strongest in industries where accidents are more common. The ratio of accidents per 1,000 employees is decreasing since 2011, from 30.8‰ to 27.5‰ in 20014.

Accidents at work, with four days’ absence or more – working days lost

 

2008

2009

2010

2011

2012

2013

2014

All accidents

7,056

5,895

6,133

6,320

6,299

6,117

6,154

Percentage change on previous year

-

-16.5

4.0

3.0

-0.3

-2.9

0.6

Per 1,000 employees

37.3

29.7

30.3

30.8

29.4

28.2

27.5

Source: Eurostat, [hsw_mi01] and [lfsa_eegaed]

According to national statistics provided by the Occupational Accident Fund (Association d’assurance accident – AAA), the frequency rate of occupational accidents causing absence from work of at least one day has decreased steadily: it was 11.08% in 2000; 7.75% in 2005; 6.28% in 2010; and 5.37% in 2014 (AAA, statistiques 2015).

Psychosocial risks

According the Labour inspectorate, there is currently no specific regulation addressing psychosocial risks at work, nor are there statistics available. However, employers are legally obliged (Labour Code, article L. 312-1) to evaluate psychosocial risks and to take the necessary measures to ensure the protection and security of employees’ mental and physical health.

Work intensity: Do you have enough time to get the job done?

In the figure, we see a comparison between Luxembourg and European Union for the workers with 'Age : All' when asked 'Do you have enough time to get the job done?'. For the 'Always or most of the time' answer, Luxembourg's score is higher than the European Union score. For the 'Rarely or never' answer, Luxembourg's score is higher than the European Union score. For the 'Sometimes' answer, Luxembourg's score is lower than the European Union score. Data is based on question 61g from the sixth European Working Conditions Survey (2015).The National comparisons visualisation presents a comparative overview for the values of all answers between two selected countries.

Source: Eurofound’s European Working Conditions Survey 2015

More detailed figures are available from Eurofound’s European Working conditions survey.

Skills, learning and employability

Skills, learning and employability

Skills are the passport to employment; the better skilled an individual, the more employable they are. Good skills also tend to secure better-quality jobs and better earnings. This section briefly summarises the Luxembourg system for ensuring skills and employability and looks into the extent of training.

National system for ensuring skills and employability

The State plays a very active role in continuing training provision as a whole. It acts in particular to enhance legislation in this area for collective access and individual access, to co-fund company investment and to facilitate the governance of the system.

The employers' professional chambers and the employees' professional chambers are also involved in shaping educational and vocational training policy through the recommendations they make. Professional chambers are strongly involved in upskilling.

The national institute for the development of continuing vocational training (Institut national pour le développement de la formation professionnelle continue, INFPC) is a public institution under the supervision of the Ministry of Education, Children and Youth (Ministère de l’Education nationale, de l'Enfance et de la Jeunesse). Its tasks are to promote lifelong learning within an economic network, and to unite all of the social and economic stakeholders around the common purpose of developing continuing training.

There are currently several sector-specific bodies that are involved in delivering continuing vocational training.

Private sector companies legally based in Luxembourg and that carry out their activities mainly there, can obtain training support worth 20% of the sum invested annually. The State's financial contribution increases to 35% for participants' salary expenses if certain criteria are met on the date on which the training plan starts; the employee must have either no recognised diploma and less than 10 years' seniority, or a recognised diploma plus either more than 10 years' seniority or aged over 45.

Training

The responsibilities of training regulation and development are shared between the Ministry of Labour and the Ministry of Education. The first supervises the Employment public service – the Agency for the Development of Employment (Agence pour le développement de l’emplo i – ADEM). The second supervises the Department of Adult Education (Service de la formation des adultes - SFA) and the Vocational Training Service (Service de la formation professionnelle - SFP). The National Centre for Continuing Vocational Training (Centre national de formation professionnelle continueCNFPC) also plays a role in providing professional training.

Training: Have you had any on the job training in the past years?

In the figure, we see a comparison between Luxembourg and European Union for the workers with 'Age : All' when asked 'Have you had on-the-job training in the last 12 months?'. For the 'No' answer, Luxembourg's score is lower than the European Union score. For the 'Yes' answer, Luxembourg's score is higher than the European Union score. Data is based on question 65c from the sixth European Working Conditions Survey (2015).The National comparisons visualisation presents a comparative overview for the values of all answers between two selected countries.

Source: Eurofound’s European Working Conditions Survey 2015

More detailed figures are available from Eurofound’s European Working conditions survey.

Work organisation

Work organisation

Work organisation underpins economic and business development and has important consequences for productivity, innovation and working conditions. Eurofound research finds that some types of work organisation are associated with a better quality of work and employment. Therefore, developing or introducing different forms of work organisation are of particular interest because of the expected effects on productivity, efficiency and competitiveness of companies, as well as on workers’ working conditions. Ongoing research by Eurofound, based on EurWORK, the European Working Conditions Survey and the European Company Survey, monitors developments in work organisation.

For Luxembourg, the European Company Survey 2013 shows that between 2010 and 2013 38.6% of establishments with 10 or more employees reported changes in the use of technology, 36.2% introduced changes in ways to coordinate and allocate the work to workers and 20.2% saw changes in their working time arrangements.

Work organisation: Are you able to choose or change your methods of work?

In the figure, we see a comparison between Luxembourg and European Union for the workers with 'Age : All' when asked 'Are you able to choose or change your methods of work?'. For the 'No' answer, Luxembourg's score is lower than the European Union score. For the 'Yes' answer, Luxembourg's score is higher than the European Union score. Data is based on question 54b from the sixth European Working Conditions Survey (2015). The National comparisons visualisation presents a comparative overview for the values of all answers between two selected countries.

Source: Eurofound’s European Working Conditions Survey 2015

More detailed figures are available from Eurofound’s European Working Conditions Survey.

Equality and non-discrimination at work

Equality and non-discrimination at work

According to the Labour Code (articles L. 253-1 to L. 253-4), any direct or indirect discrimination on the grounds of religion or belief, disability, age or sexual orientation, real or supposed racial or ethnic origin is prohibited. A law of June 2016 adds discrimination related to gender reassignment to discrimination on the ground of gender. This applies to conditions of access to employment, self-employment or to occupation, including selection criteria and recruitment conditions, whatever the branch of work and including all levels of the professional hierarchy and promotions. It covers:

  • access to all types and all levels of vocational guidance, vocational training, advanced vocational training and retraining, including practical work experience;
  • employment and working conditions, including dismissals and pay;
  • membership of, and involvement in, an organisation of workers or employers, or any organisation whose members carry out a particular profession, including the benefits provided by such organisations.

According the Penal Code (articles 454 to 457), the sanctions for breaches of discrimination are imprisonment for between eight days and a maximum of two years, and/or a fine of between €251 and €25,000.

The public body which is entrusted with ensuring equality at work is the Centre for Equal Treatment (Centre pour l’égalité de traitement), set up by the laws of 28 and 29 November 2006. It started work in 2008. The centre carries out its missions independently, and its purpose is to promote, analyse and monitor equal treatment between all persons without discrimination on the basis of race, ethnic origin, sex, sexual orientation, religion or beliefs, handicap or age.

Equal pay and gender pay gap

The main provisions ensuring equal pay for equal work figure in the Labour Code (articles L. 241.1 to L. 241.11). The principle of equal opportunities between men and women also applies to the following.

  • Conditions of access to employment, including selection criteria and recruitment conditions, whatever the sector of work and including all levels of the professional hierarchy and promotions.
  • Access to all types and all levels of vocational guidance, vocational training, advanced vocational training and retraining, including practical work experience.
  • Employment and working conditions, including dismissals and pay.
  • Membership or involvement in an organisation of workers or employers, or any organisation whose members carry out a particular profession, including the benefits provided by such organisations.

For access to employment and training leading to employment, a difference of treatment based on sex shall not constitute discrimination where, by reason of the nature of the particular occupational activities concerned or the context in which they are carried out, this constitutes a genuine and determining occupational requirement, provided that the objective is legitimate and the requirement is proportionate.

The legal provisions prohibit any direct or indirect references to the sex of the employee in employment offers or notices and in criteria for professional aptitude tests.

Any legal or contractual provision violating the principles of equal treatment is deemed to be null and void. All employers must ensure equal remuneration for men and women who do similar work or work of equal value.

Over the past decade, the unadjusted gender pay gap has decreased from 10.7% in 2006 to 8.6% in 2012. According the last results of the Structure of Earnings Survey 2010 (J. Ries, L. Mapengo, ‘Salaires, emploi et conditions de travail – Premiers résultats de l'enquête sur la structure des salaires de 2010, Bulletin du Statec n° 2/12, Statec 2013), the pay gap between all men and women workers was 20%. However, when limited to full-time workers, the pay gap was 9%. The latest results show an improvement: in 2014, the pay gap between all men and women workers was 17%. Limited to full-time workers, the pay gap was 6% (‘Salaires, emploi et conditions de travail – Premiers résultats de l'enquête sur la structure des salaires de 2014, Bulletin du Statec n° 1/17, Statec 2017).

To reduce gender inequality, the government launched in March 2016 a ‘Plan for equality between women and men 2015–2018’. In this framework, the Government Council passed amendments to the Labour Code on 23 September 2016 (see press release). The main change is the introduction of the men–women equal pay principle within the Labour Code that currently only takes place in a Grand Ducal regulation. The bill also amends the Labour Code on two points: 1) It simplifies the procedure for receiving financial help in the case of hiring a worker of the under-represented gender; 2) It specifies the conditions for receiving financial assistance under the ‘positive actions’ programme.

Quota regulations

There is currently no obligation for specific quotas to promote the membership of women on supervisory boards. However, to reach the goal of having 40% of economic decision-making posts occupied by women by 2019, in 2009 the Equal Opportunities Ministry, in partnership with the Economy Ministry, launched a new scheme and is appealing to the private sector to do more.

Bibliography

Bibliography

All Eurofound publications are available at www.eurofound.europa.eu.

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Bonn Steichen and Partners (2013), Luxembourg: Employment Law (3.87 MB PDF), Bonn Steichen and Partners, Luxembourg.

Clément, F. (2008), Les relations professionnelles au Luxembourg [Industrial relations in Luxembourg], Eures, Luxembourg.

Clément, F. (2011), Les relations professionnelles tripartites: Le cas du Grand-Duché de Luxembourg [Tripartite industrial relations: the case of the Grand Duchy of Luxembourg], PhD thesis, Conservatoire national des arts et métiers, Paris.

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Maas, R., Blond-Hanten, C., Etienne-Robert, F. (2012), Le temps de travail, l’emploi, la formation et l’égalité des genres dans les conventions collectives de travail en 2005 et 2006 [Working time, employment, training and gender equality in collective labor agreements in 2005 and 2006], CEPS-INSTEAD, Esch-sur-Alzette.

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Thill, P. and Thomas, A. (2011), ‘The end of consensus? The effects of the economic crisis on industrial relations in Luxembourg’, in Baglioni, M. and Brandl, B. (eds.), Changing labour relations between path dependency and global trends, Peter Lang, Frankfurt.

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