Parental leave introduced as NAP is implemented

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Under legislation introduced in February 1999, as part of Luxembourg's National Action Plan for employment, employees who are parents may take six months' parental leave (or 12 months' part-time leave) in respect of all children born after 1 January 1999. One parent may opt for this leave immediately after the period of maternity leave, while the other parent may take it at any time up to the child's fifth birthday. During parental leave, the employee receives a benefit paid out by the National Family Allowances Fund.

After substantial controversy and lengthy delays (LU9902194N), on 3 February 1999, Luxembourg's National Action Plan (NAP) on employment, in response to the EU Employment Guidelines, was finally passed by the Chamber of Deputies with a comfortable majority. The feature of the Plan that has engendered most controversy amongst those affected is the introduction of parental leave. Previously, Luxembourg's provisions on parental leave were limited in the private sector to an entitlement for women employees to stop work for up to a year after maternity leave and receive priority consideration for vacancies, though without being guaranteed re-engagement (LU9805160N). The 1996 EU Directive on parental leave (96/34/EC) required the Member States to implement its provisions - a right for all employees to three months' parental leave for childcare purposes, distinct from maternity leave, after the birth or adoption of a child until a given age of up to eight years - by June 1998 (TN9801201S).

Conditions for granting parental leave

Under the new legislation, a request for parental leave (congé parental) - either full-time or part-time - may be submitted by anyone who:

  • is at home bringing up one or more children who are under the age of five, and for whom a family allowance is payable;
  • devotes most of his or her time to bringing up these children, and either takes no paid employment during the period of parental leave or, in the case of a parent opting for part-time leave, takes one or more part-time jobs - as long as the monthly total of hours worked does not exceed half of the normal monthly working hours applicable in the establishment concerned;
  • lives and resides continuously in Luxembourg, or comes within the scope of EC regulations;
  • is lawfully and continuously employed in a workplace in Luxembourg at the time when the child is born, or at the point when adoption procedures are initiated, working either on a self-employed basis or, for at least one year preceding the beginning of the parental leave, for a legally constituted company in Luxembourg under a contract of employment or apprenticeship whose working hours are no fewer than half the normal working hours for that establishment; and
  • has compulsorily and continuously been a member of the state pension scheme for at least 12 months immediately prior to the beginning of the leave.

The content of parental leave

Every parent who meets the above criteria is entitled to six months' parental leave per child on demand. Alternatively, by agreement with his or her employer(s), the beneficiary parent may take 12 months' part-time parental leave; the parent's paid employment must then be reduced to at least half the number of normal monthly working hours applicable.

Parental leave must be taken once and for all and in its entirety, and may not be granted twice to the same parent in respect of the same child(ren). It is not permissible for both parents to take full-time parental leave at the same time; however, if they opt for part-time parental leave, they can share the leave between them in such a way that the child is continuously looked after.

One of the parents may go on parental leave immediately after the period of maternity leave or adoption leave and the other parent may take parental leave up until the child's fifth birthday. Parental leave that is not taken by one of the parents is not transferable.

Applying for parental leave

Parents in employment who intend to exercise their right to parental leave immediately after the period of maternity leave must notify the employer of their application before the beginning of maternity or adoption leave. Employed parents who intend to exercise their right to parental leave at some point prior to the child's fifth birthday must notify the employer of their application at least four months before the leave is due to begin.

Employers are obliged to grant parental leave after maternity leave. Exceptionally, the employer may refuse to grant the parental leave during the subsequent period up to the child's fifth birthday and ask for it to be deferred, for the following reasons and in the following circumstances:

  • when a significant proportion of the workforce puts in for parental leave at the same time, and the organisation of work would be seriously disrupted as a result;
  • when it is not possible to replace the employee on parental leave during the notice period, either because of special features that attach to the work carried out by the applicant, or because there is a shortage of workers in that particular sector;
  • when the employee is in a high-ranking position and is involved in the effective management of the enterprise;
  • when the work is of a seasonal nature, and the request for leave covers a seasonal period; or
  • when the enterprise normally employs fewer than 15 workers under a contract of employment (no distinction drawn between blue- and white-collar staff).

No deferral may be authorised should serious circumstances arise that have serious repercussions for the child, and where it is necessary for the employee to be able to be with the child and provide special assistance. Nor is deferral possible after the employer has agreed to the request, or if there is no reply within four weeks.

When the leave is deferred, the employer must, within one month, offer the employee a new date - the leave may not commence more than two months after the beginning of the period of leave originally applied for. When the work is of a seasonal nature, the leave may be deferred until after the seasonal period has passed. In the case of an enterprise employing fewer than 15 workers, the deferral period is extended from two months to six months.

If the enterprise has an employee committee/works council (délégation du personnel), the employer must notify it of any refusal to grant parental leave. In the event of any disagreement, the director of the Labour and Mines Inspectorate may seek to prevent, or resolve, any differences; if that fails, the matter may be taken to the Labour Tribunal, which may in turn give an emergency ruling.

The status of employees on parental leave

The contract of employment is suspended during the period of parental leave, and the employer is not allowed to terminate the contract of the employees concerned. Were the employer to do so, the decision would be deemed null and void. Throughout the period of the parental leave, the employer is obliged to keep the employee's job open - or a similar job with the same remuneration.

The period of parental leave is taken into account when determining rights related to length of service. Employees are also entitled to all benefits that have accrued before the leave begins. The period of parental leave is counted towards membership of a pension scheme, and for calculating the contribution period that triggers an entitlement to full unemployment benefit.

Employees taking parental leave are entitled to a flat-rate cash payment, currently standing at EUR 1,496 a month for full-time leave, and EUR 748 a month for part-time leave. The benefit is paid by the National Family Allowances Fund (Caisse Nationale des Prestations Familiales), and is exempt from tax and from most social insurance contributions. It is indirectly funded by a contribution from the Fund for Employment (Fonds pour l’Emploi), whose funds have been swelled by a new "social contribution" tax levied on fuel oils (LU9811174F).

Commentary

Although it has taken Luxembourg until the end of the century to introduce parental leave, the new legislation arguably places the country in the forefront of social progress, under the pretext of promoting job creation (an approach which has largely been opposed by employers).

An assessment of the effects of the parental leave legislation will be conducted by 31 July 2003. In particular, this assessment will focus on the impact of parental leave on the labour market, equal opportunities and the interests of children. Parental leave may be reduced to three months following this assessment, although a special law could always be introduced to extend the current provisions. It seems, however, unlikely that the period of parental leave will be cut. (Marc Feyereisen, ITM)

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