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Minimum wage country profile for Luxembourg
Country profile
Last updated: 30 June 2026

Minimum wage in Luxembourg

Kristell Leduc

Information for this page was compiled during December 2025 and early 2026. Most Member States had already transposed the EU minimum wage directive at this point. Those that had not yet fully completed transposition or where the information was not yet publicly available include Bulgaria, Cyprus, Luxemburg, Poland and Portugal. These profiles will be updated consecutively as the information becomes available. Users are invited to contact our experts on minimum wage if they are aware of changes.

These profiles describe how minimum wages are regulated and set. They are available for all EU countries and Norway.

This profile describes how minimum wages are regulated and set in Luxembourg. It can be read as background information for Eurofound’s annual review of minimum wage setting series. Luxembourg has a statutory minimum wage, referred to as the ‘minimum social wage’ (Salaire Social Minimum, SSM). In addition, a higher rate is also set for qualified employees.

The Act of 31 July 2006 introduced a Labour Code, which included a reform of the SSM regulation. In the consolidated version of the Labour Code valid in 2024, the SSM is regulated by arts. L. 222-1 and following.

Currently, the SSM undergoes two types of revaluation (1. regular adjustments carried out every two years; and 2. adjustments based on an indexation mechanism), explained in more detail in the section ‘Process of setting the minimum wage’. The level of the SSM set by the regular adjustment which takes place every two years is provided in art. L. 222-9 of the Labour Code. To this rate, eventual indexation-based adjustments occurred after the last regular update must be added.

The second one started the 1 May 2025 following the Labour Code and the adjustment with the ‘mobile wage scale’ (échelle mobile des salaires) from the Labour Code (Chapter III, Article 223.1 - Labour Codeopens in new tab, version of 19 December 2025).

Concerning the EU directive, in 2024, Mr Georges Mischo, Minister of Labour, submitted to the Parliamentary Administration on 30 August 2024, draft law No. 8437 amending the Labour Code in order to transpose Directive (EU) 2022/2041 of the European Parliament and of the Council of 19 October 2022 on adequate minimum wages in the European Union. Five Luxembourgish chambers and organisations have submitted their opinions: Employee chamber (23 October 2024), Chamber of Trades (10 December 2024), Chamber of Civil Servants and Public Employees (6 December 2024), Council of State (10 December 2024), Chamber of Commerce (13 January 2025). In May 2025, Bill No. 8437 was put on hold while the government waited for the outcome of the appeal brought by Denmark and Sweden before the Court of Justice of the European Union (CJEU), which challenged the directive’s legal basis. The CJEU's ruling on 11 November 2025 removed this uncertainty and paved the way for renewed debate. At the time of updating (16 December 2025) the law is still in draft status.

The recent amendments to Luxembourg’s Labour Code to align with Directive (EU) 2022/2041 focus on changes to the minimum wage rather than collective bargaining. Key updates include:

  1. Criteria for Adjusting the Minimum Wage: New factors such as purchasing power, wage distribution, growth rates, and national productivity trends must be considered for wage adjustments.

  2. Repeal of Delayed Wage Application: Article L. 222-6, which allowed employers to delay minimum wage implementation under specific conditions, has been repealed due to non-compliance risks and lack of use.

  3. Protection Against Unfair Dismissals: Dismissals linked to exercising minimum wage rights are prohibited. Violations result in null dismissals, with a fast-track process for reinstatement within 15 days.

  4. Advisory Body on Minimum Wage: A new entity comprising representatives from unions, employers, and institutions will monitor wage evolution, exchange data, and provide studies and guidance to the government.

Minimum wage setting requires collaboration of multiple actors.

The Tripartite Coordination Committee conducts social negotiations related to minimum wages. Social negotiations involve the government and social partners, including representatives of employers and workers. These negotiations may result in agreements on minimum wages, which are then considered during the adjustment process. This committee has been created by Grand-Ducal regulation of 26 January 1978.

The committee is composed of:

  • Four members of the government: the Minister of State who holds the chairmanship, the Minister of the National Economy, the Minister of Labour and Social Security and the Minister of Finance.

  • Four employers’ delegates, two of whom are to be appointed by the Chamber of Commerce, one by the Chamber of Trades and one by the Central Farmers' Association acting as the Chamber of Agriculture.

  • Four delegates to be appointed by the most representative trade unions at national level, including one representative of the civil service.

The National Institute of Statistics and Economic Studies (STATEC) is responsible for publishing the consumer price index on a monthly basis. It can impact the wage scale and trigger a new indexation of the minimum social wage if the index increases or decreases by 2.5% in the preceding semester.

Other advisory bodies: The ‘Comité de conjuncture’ (‘Business cycle committee’) and the Economic and Social Council regularly review economic conditions. They may provide opinions or recommendations on issues related to minimum social wages, including adjustments based on various factors such as inflation and the cost of living. The members of the Conjuncture Committee represent employees and employers, as well as various ministries and government departments.

Government and social partners are therefore the main actors involved in statutory wage setting, through participation in the above-mentioned bodies and through

The mechanism of adjusting the minimum wage in Luxembourg strongly relies on social dialogue and consultation between social partners, which means that decisions on the minimum social wage (SSM) are often taken collectively, with the active participation of trade unions and employers’ organisations. Considerations leading to an adjustment of the SSM may be based on various economic and social factors, such as inflation, cost of living, productivity, labour market conditions and government policies on employment and social welfare.

The exact procedure of minimum wage setting may vary, but generally the government will propose an increase of the statutory minimum wage after examining relevant data and consulting with stakeholders. Trade unions and employers’ organisations may be invited to participate in negotiations or discussions to reach a consensus on the proposed increase. Once an agreement is reached, the government may formalise the increase in statutory minimum wage through legislation or regulation.

Concerning the timing, it can vary depending on the specific circumstances. The process generally involves several steps:

  • Data analyses: Economic and social data, such as inflation rates and productivity measures, are collected and analysed to understand the economy and labour market.

  • Consultation: The government consults with social partners (trade unions, employers' associations) about possible adjustments to the minimum social wage (SSM), taking into account economic and social factors.

  • Negotiation: Discussions take place between the government, trade unions and employers’ organisations to agree on changes to the statutory minimum wage, including the extent of the increase and implementation details.

  • Legislative action: Once an agreement is reached, the government may amend laws or regulations to formalise the increase in SSM.

  • Implementation: Approved changes are put into action, such as updating payroll systems and informing employers and employees of new wage rates. Compliance with new regulations is ensured.

As mentioned in the section ‘Minimum wage regulation’, the SSM is adjusted in two ways:

  1. The first type of revaluation of the SSM (provided by art. L. 222-2 (2) of the Labour Code), which occurs every two years, is carried out by the government, who submits to the Chamber of Deputies a report on the evolution of general economic conditions and income accompanied, where appropriate, by a bill raising the level of the minimum social wage. The methodology that has been developed is based on Luxembourg's ‘general average’ salary as an indicator for assessing whether to raise the rate and by how much. However, a constraint is that each adjustment must depend on available data, typically drawn from a year and a half prior. Various components of income are considered such as basic salaries, bonuses, and replacement income directly tied to wages (e.g. sick pay). Salaries are assessed up to seven times the Minimum Social Wage (SSM, statutory minimum wage), and the lowest 20% and highest 5% of salaries are excluded. The reference population includes individuals aged 20 to 65 affiliated with the National Pension Insurance Fund and public sector employees. Self-employed workers, those on parental leave, and certain inactive individuals are excluded. The indicator is the average hourly wage, calculated by dividing total wages by the sum of hours worked in the reference population.

  2. The second type of revaluation of the SSM is the indexation mechanism, based on the automatic adjustment in line with changes in the cost of living, which is calculated based on changes in the consumer price index. The current legal basis for it is art. L. 222-3 of the Labour Code, which provides that without prejudice to the first type of revaluation, the adaptation of the SSM to the weighted consumer price index is done in accordance with Article L. 223-1, which in turn provides that the wage rates resulting from a law, a collective agreement and an individual employment contract are adapted to variations in the cost of living, in accordance with the law establishing the salary regime for state civil servants. The common rule is that when the consumer price index (CPI) calculated by STATEC rises or falls of more than 2.5%, all wages are increased or lowered by 2.5%.

Criterion

How is this defined/operationalised?

Regulation or practice

Biennial adaptation of the SSM

  • Average wage or salaries
  • total wages of the reference population
  • Sum of the hours worked by the reference population

The reference population taken into account is represented by all employees aged 20 to 65 who are compulsorily affiliated to the National pension insurance fund as well as employees aged 20 to 65 in the public sector. This reference population, therefore, does not include self-employed workers, contributors on parental leave, ‘inactive’: unemployed, early retirees, beneficiaries of a re-employment allowance.

The salaries taken into account include wages and all kinds of bonuses up to seven times the SSM. Replacement income linked directly to wages (e.g. cash sick pay or maternity pay) are treated as wages. But in this methodology, 20% of the lowest salaries and 5% of the highest salaries are eliminated in order to exclude the influence of an increase in the reference minimum wage during the wages observation period. The reference population is reduced to 75% of its initial size, resulting in a set of salaries that are not directly tied to the minimum wage.

Article 2 of the law of 12 March 1973: a new legal basis and a biennial adjustment.

The data used come from the monthly declaration of wages at the Joint Social Security Centre (CCSS).

Wage indexation

The consumer price index that impacts the wage scale

A new indexation is triggered when the semi-annual average of the Consumer Price Index, linked to the base date of 1 January 1948, rises or falls by 2.5% from the last expiration rating. The new application rating takes effect the following month, resulting in a 2.5% adjustment to wages, salaries, and pensions.

In calculating this consumer price index, the fundamental principle is to track the monthly evolution of prices for the same product or service at the same point of sale, allowing for a relevant assessment of price changes. STATEC monitors prices for various brands, types, sizes, and across different stores. Before 2018, individuals physically inspected prices in stores (7,700 prices of various goods and services being recorded). Since 2018, electronic files are now directly transmitted by several supermarkets to STATEC. In 2023, an extra 90,000 varieties were included in the calculation of the Consumer Price Index.

Henceforth, all wages and salaries in the private and public sectors, pensions, accident pension, apprenticeship & family allowances and the social inclusion income (REVIS) are adjusted to the changes in prices (Law of 27 May 1975 generalising the sliding scale of wages and salaries).

Law of 28 April 1972 (year of change). Adjustments were no longer based on a points system, but on a percentage system. From then on, each indexation bracket amounted to 2.5%.

Law of 27 May 1975 generalising the sliding scale of wages and salaries.

As of the end of 2025, the European directive on the minimum wage had not yet been transposed into Luxembourgish law, as Draft Law No. 8437 — which aims to amend the Labour Code to comply with the directive — was still under review by the Labour Committee in Parliament and had not yet been definitively adopted. Consequently, there is currently no official procedure in Luxembourg for assessing the adequacy of the minimum wage.

According to the available documents, including the legislative file and the opinions of five chambers and organisations, the current Luxembourg minimum wage does not meet any of the reference thresholds mentioned in the directive, such as 60% of the median wage or 50% of the average wage. The Council of State questions which criteria will finally be used to assess the adequacy of the minimum wage.

Following the change in the Minister of Labour in December 2025, the government will resume discussions and develop an approach to adapting the European requirements to the national context. This will include debates on which indicators should be used, such as whether to include public-sector wages and which components to exclude, as well as how to calculate purchasing power.

The minimum wage is compulsory for all companies established in Luxembourg, depending on the employee's level of qualification and age. Companies are not allowed to pay less than the minimum wage. This also applies where foreign employees are seconded to Luxembourg.

There are different rates, defined as a percentage of the social minimum wage rate, according to age and qualification.

Groups of workers

% of SSM full rate

Workers aged 15 to less than 17 years old

75

Workers aged 17 to less than 18 years old

80

Pupils and students during the school holidays employed in seasonal employment

80

Non-qualified workers aged 18+

100

Employees with professional qualification aged 18+ (art. 222-4 (1) Labour Code)

120

Art. L. 211-5 of the Labour Code provides that working hours may not exceed eight hours per day and 40 hours per week (except if the applicable collective agreement may set lower limits).

The social minimum wage is defined both at a monthly rate (i.e. 173 hours per month) and hourly rate (monthly rate divided by 173 – Article 222-9 of Labour Code). Moreover, in Luxembourg, wages (including the SSM) are paid to workers over 12 months (except the applicable collective agreement provides otherwise), and they may also have in addition bonuses, gratuities, or payments spread over additional months.

Art. L. 221-1 of the Labour Code stipulates that ‘The salary/wage stipulated is paid each month, at the latest on the last day of the relevant calendar month’ and Art. L. 222-9 of the Labour Code says that ‘The hourly rate corresponding to the monthly rate provided for in paragraph 1 is obtained by dividing this monthly rate by one hundred and seventy-three’.

Employers in Luxembourg cannot pay an employee below the minimum wage, whatever the business activity and all the bonuses are in addition to the minimum wage (ITM guidanceopens in new tab, Art. L. 222-1 of the Labour Codeopens in new tab).

In Luxembourg, benefits in kind (housing, company cars, free or subsidised meals, health insurance, etc.) can either be included in the salary or paid in addition to the salary (Art. L. 221-1 of the Labour Codeopens in new tab). This depends on the employer's practice and the agreements between the employer and the employee. These benefits may be considered part of the employee's total compensation package or offered separately from monetary compensation. Specific terms and conditions vary according to company policy and any applicable collective bargaining agreements.

To resume, here are the components counting toward the minimum wage

Component

Description

Basic salary

Defined in the contract as the agreed monthly/hourly pay.

Bonuses

Usually in addition, unless explicitly included in the basic wage. It depends on employer-employee agreement or collective agreement

Overtime allowances

No, it is paid on top of the minimum wage.

Deductions allowed by law:

Deduction type

Description

Board and lodging provided by employer

Deduction allowed if agreed in the contract but must not reduce wage below legal minimum.

Social security contributions

Deduction allowed - Mandatory deductions

Taxes

Deduction allowed - Mandatory deductions

Other deductions

Only if legally permitted or contractually agreed and must respect statutory minimum wage.

Source: Luxembourg Labour and Mines Inspectorate (Inspection du Travail et des Mines – ITM) - wages informationopens in new tab and the amount of the minimum remunerationopens in new tab, website, updated December 2025.

Chamber of Employees (CSL) - definition of the concept of remunerationopens in new tab

Labour Code, Art. L. 221-1, 222-1opens in new tab, updated December 2025.

Every month, even if no revaluation occurred, the Ministry of Social Security and the General Social Security Inspectorate (IGSS) are publishing the social parameters valid from at least the current period.

The Employee Chamber of Luxembourg (Chambre des Salariés du Luxembourg, CSL) publishes every year a report providing an overview of the social situation in the country, in connection with the topic of minimum wage. One of them is dedicated to ‘poverty and inequalities’, and one section focuses on the population on social minimum wage.

In 2023, the Employee Chamber of Luxembourg undertook significant work by publishing a comprehensive report focusing on individuals earning salaries close to the minimum wage (SSM). This publication offers both descriptive and temporal analyses of this demographic. Furthermore, it includes a comparative examination of the unskilled minimum wage (SSM-NQ) at both national and European levels, clearly highlighting its insufficiency in meeting internationally recognised standards. Additionally, the report introduces two novel and insightful analyses previously unexplored in Luxembourg.

It is worth noting that a preliminary study with a similar title was conducted by an author from the General Social Security Inspectorate (IGSS) in 1996.

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