Law on minimum social wage and adapted wages, salaries and pensions (1 January 2017)
The Law of 15 December 2016 increased the minimum social wage from 1 January 2017. In addition, an adjustment of the sliding wage scale (the mechanism by which wages in Luxembourg are adapted to the cost of living) was triggered with the consumer price index for December 2016. This resulted in an increase of 2.5% of wages, salaries and pensions as of 1 January 2017.
As of 1 January 2017, the new minimum monthly social wage (applying the index of 794.54) is:
Law on immigration (8 March 2017)
The main purpose of this Law is to transpose two Directives into Luxembourg law: Directive 2014/36/EU establishing the conditions of entry and stay for third-country nationals for the purposes of employment as seasonal workers, and Directive 2014/66/EU on intra-corporate transfers.
The Law provides that a residence permit can now be requested specifically for third-country seasonal national workers. It also introduces a residence permit for intra-corporate temporary transferees intended for third-country national managers, experts and trainees involved in temporary intra-corporate transfers. This new permit is referred to as an ‘ICT’ or ‘mobile ICT’ depending on whether it is designed for short or long-term movement. It replaces the residence permit for a transferred employee, although any permits that have already been issued will remain valid until their expiry date.
The other main provisions of the Law include:
Law concerning the posting of employees (14 March 2017)
This Law implements law Directive 2014/67/EU on posted workers into national law, inserting the following key changes into the Labour Code:
Law introducing a system to combat long-term unemployment (20 July 2017)
The Law includes the main following provisions:
New form of aid to hire the long-term unemployed
Changes to the aid system for hiring ‘older’ unemployed people
The law specifies that the aid provided to help employ older unemployed people and the aid provided to employ the long-term unemployed cannot be combined.
Opening up of professional training internships to unemployed people aged between 30 and 44
Reduction in duration of compensated temporary occupations (‘occupations temporaires indemnisées’ or ‘OTI’) ,
Law on co-funding for continuing professional training (29 August 2017)
The main changes include the following:
|Number of employees||% of payroll|
|1 to 9||20|
|10 to 249||3|
The National Institute for the Development of Continuing Professional Training has specified that the new provisions of the Law will be taken into account within the context of decisions on applications for co-funding for the trading year 2018.
Law reforming care insurance (29 August 2017)
The main lines of the reform of the care (non-medical assistance) insurance are as follows:
The methods of determining care needs and the term and limits of care coverage are set out in several Grand-Ducal regulations published on December 13, 2017.
Law on early retirement (30 November 2017)
The law repeals pre-retirement-solidarity (‘pré-retraite solidarité’). However, it may continue to apply in undertakings whose collective agreement concluded before 1 July 2018 provides for pre-retirement solidarity, as well as in companies covered by a pre-retirement-solidarity agreement signed before 1 July 2018 with a Minister with employment related functions, for a maximum period of two years from the signature of this agreement.
To compensate for the abolition of pre-retirement-solidarity, the conditions for opening early retirement schemes for shift employees and night workers and for early retirement are made less burdensome.
For all early retirement schemes (pre-retirement adjustment, early retirement for shift work, gradual early retirement), the law provides, in particular, that a minimum affiliation of five years with the applicant company must exist at the time of the application for admission to early retirement, and that the insured can now choose between an early retirement pension and one of the pre-retirement-schemes up to age 63. The law also includes the following novel elements:
Regulations relating to the delegation of personnel (15 December 2017)
A Grand-Ducal Regulation amends article L. 416-1 of the Labour Code by specifying the content and form of the agenda of the constituent meeting of the staff delegation. It also provides for the need to send signed meeting minutes to the employer and the ITM within 5 days at the latest.
A second Regulation amends article L. 412-2 of the Labour Code providing that the percentage of the annual total payroll for the assumption of an expert’s financial responsibility is limited to 0.10%.
Law on leave for personal reasons, postnatal leave and leave for family reasons (15 December 2017)
This Law came into force on 1 January 2018. It changes the rules for certain kinds of leave to improve the balance between family life and work life, whilst also taking into account current social realities.
Extraordinary leave for personal reasons: for this kind of leave, the Law specifies that the word ‘child’ refers to any child born within or outside marriage or adopted.
Paternity leave and adoption leave, unlike other kinds of leave, can be split, and must be taken within two months of the birth or arrival of the child respectively. Nevertheless, if the employer does not agree to this due to the needs of the business, the leave must be taken in one go, immediately after the birth or arrival of the child. In practical terms, the employee must inform the employer in writing, giving two months’ notice, of the expected dates on which he would like to take his leave. If this notice is not given, the leave may be reduced to two days by the employer. The government will pay for this leave from the third day onwards. The employer must submit its request for a refund for salaries paid to the Minister responsible for employment within five months of the birth or arrival of the child, failing which the request will not be considered. The salary taken into consideration for this refund is limited to five times the minimum social wage for unqualified employees.
Post-natal and adoption leave: the length of these kinds of leave is extended from 8 to 12 weeks. The additional month of leave for breastfeeding women has been integrated into the core maternity leave period, which is now of eight weeks before the birth and 12 weeks after the birth.
Leave for family reasons: the Law specifies that for this kind of leave, a ‘dependent child’ is understood to be any child born within or outside the marriage or adopted who, when ill, requires the physical presence of one parent. The number of days of leave now depends on the age of the child:
Signature of the Collective Bargaining Agreement for bank employees 2017
The addendum to the Collective Bargaining Agreement for bank employees 2014-2016 for the year 2017 was signed on 22 June 2017 by the ABBL (the Luxembourg Bankers’ Association) and trade union representatives ALEBA, OGB-L and LCGB-SESF.
The signatories of the Addendum agreed to extend the application of all the provisions of the collective agreement for bank employees 2014-2016 to 2017, without any exceptions or exclusions.
The Addendum also includes an addition to article 23 of the Collective bargaining agreement 2014-2016 with a point E, entitled “Remuneration for 2017”, regarding:
Collective Employment Agreement for employees in the care and support sector and the social sector (‘CCT SAS’)
A new CCT SAS for the period from 1 October 2017 to 31 December 2019 was agreed between COPAS, EFJ, EGCA, EGMJ (representative bodies in the care sector), on the one hand, and the trade unions OGB-L and LCGB on the other on 27 August 2017. The Council of Ministers approved the declaration of general obligation for the new CCT SAS on 18 October 2017.
The amendment to the collective labour agreement and the new collective labour agreement for Employees in the Sector of Aid and Care and the Social Sector (valid for the period from 1 October 2017 to 31 December 2019) have been declared generally binding by a Grand-Ducal Regulation of 28 October 2017.
Law amending the general status of municipal officials (28 July 2017)
The purpose of the law is to implement the provisions and mechanisms resulting from the reform of the general statute of state officials (implemented by the laws of 25 March 2015) at a communal level.
The law also clarifies the distribution of responsibilities for the appointment of a communal officer, a communal employee or a communal employee, as well as minor amendments concerning the regulation of the right to strike in the communal sector.
Two Grand-Ducal Execution Regulations have also been published and entered into force on 1 September 2017:
Tax reform for meal vouchers and company cars (1 January 2017)
A law of 23 December 2016 relating to the 2017 tax reform has changed the rules for the taxation of benefits in kind (meal vouchers and company cars), as of 1 January 2017.
The permitted face value of meal vouchers has increased from EUR 8.40 to EUR 10.80. The value of the payment in kind of EUR 2.80 remains unchanged, meaning the amount of tax exemption per voucher has increased to a maximum of EUR 8.00.
The flat 1.5% rate of taxation for company cars was replaced by a scale of rates related to CO2 emissions and/or the engine power, to encourage employers and employees to choose more environmentally friendly vehicles. For cars covered by a contract still in force on 1 January 2017, the benefit in kind continues to be calculated at the 1.5% rate until the end of the contract term.
New Collective employment agreement in the Hospital Sector (1 July 2017)
A new collective employment agreement (the ‘CCT FHL’) was made obligatory for all employees of Luxembourg hospitals on 15 November 2017. The new CTC FHL applies public sector career progression and salary conditions to the hospital sector, introducing a revised career model, which came into effect on 1 October 2017.
CTC FHL also provides for the start of discussions on improving the organisation of working time and its management, with conclusions to be reached by 30 June 2018 at the latest.
The new CTC FHL is valid from 1 July 2017 to 30 June 2020.