Minimum Working Conditions
The Labour Code provides for minimum working standards. Both parties to the employment contract may only deviate from the Labour Code by being more favourable for the employee. Senior executives (cadres supérieurs) are excluded from the application of certain rules (for instance, the rules on working time). The Labour Code defines senior executives as employees enjoying a higher level of remuneration in comparison to other employees falling under the scope of a collective bargaining agreement and effective and real management powers, a well-defined authority, independence and freedom regarding working hours.
Salary
Parties are free to negotiate the employee’s basic salary, but they must respect the minimum social wage, which applies to all employees in Luxembourg. The applicable minimum wage varies according to the professional qualification of the employee and according to an index.
The last increase to Luxembourg’s minimum wage occurred at the beginning of 2020. The current minimum wage of €2.141,99, however, is expected to rise by 20% for those classed as ‘skilled workers’ and will decrease by 20-25% for those classed as ‘adolescent workers’. This means a skilled worker aged 18 or older must be paid 20% more than the standard minimum wage, totaling €2.570,39.
Workers aged 17 or 18 face a 20% deduction from the standard rate and must be paid at least €1.713,60, while those aged 15 to 17 face a 25% deduction and a minimum wage of €1.606,50. Even workers who earn above the minimum wage are affected by the national indexation of salaries, a barometer by which employers must adjust the wages they pay in line with the cost of living in Luxembourg. If the consumer price index rises or falls by 2.5% during a period, salaries in Luxembourg must be adjusted by this percentage.
Qualified workers include employees who:
- have a recognised official certificate at least equivalent to a vocational skills certificate (certificat d’aptitude technique et professionnelle – CATP) or a vocational diploma (diplôme d’aptitude professionnelle – DAP) from a Luxembourg technical secondary school;
- or have a manual skills certificate (certificat de capacité manuelle – CCM) or a certificate of vocational ability (certificat de capacité professionnelle – CCP) and proof of at least 2 years of experience in the trade in question;
- or have a vocational initiation certificate from a technical secondary school (certificat d’initiation technique et professionnelle – CITP) and proof of at least 5 years of practical experience in the trade or profession;
- or, if they do not have a qualification, provide proof of at least 10 years’ practical professional experience (if a certificate exists for the required qualification);
- or provide proof of at least 6 years of practical experience in a trade requiring a certain technical capacity and for which an official certificate is not issued.
Salaries are paid on a monthly basis, generally at the end of the month. Even if it is not required for the employer, it is common to provide the employee with benefits in addition to the basic salary such as luncheon vouchers or additional health insurance. These benefits could depend on the employee’s position.
Maximum Working Week
Standard working time is limited to 8 hours per day and 40 hours per week, excluding higher-ranking employees (senior executives). A working day may never exceed 10 working hours and a working week may never exceed 48 hours. A rest period of 11 hours every 24 hours and of 44 hours for every 7-day period must be respected. In addition, collective bargaining agreements may provide for other (longer) breaks.
The reform introduced by the law of 23 December 2016 on the organisation of working time introduced new rules on working time flexibility. It reformed, among other things, the existing mechanism of using a reference period, which allows the distribution of working hours over several days without them becoming overtime hours. Flexibility can be achieved either through (i) a POT (Plan d’Organisation du Travail); (ii) a flexible work schedule (Règlement d’horaire mobile); and/or (iii) a time savings account (“compte-épargne temps” – CET).
For the establishment of the POT, a ministerial agreement is no longer necessary. There are two possibilities for setting it up: (i) with a collective agreement, the social partners may fix a reference period of up to 12 months. Any compensation through additional holidays is also negotiated by the social partners; and (ii) in the absence of a collective agreement, companies may opt for a reference period of up to 4 months after prior consultation with the staff delegation or, failing that, with the employees. The ITM needs to be informed of the decision. In return, employees are entitled to compensation through additional days off.
The POT includes the working times of the employees concerned and the following elements: (i) the beginning and the end of the reference period; (ii) the normal working time to enable the employees to know the organisation of the work; (iii) the closing days of the public holidays and individual or collective leave; and (iv) and the weekly period of 44 hours of consecutive rest or the compensatory leave. If a flexible work schedule is introduced, the distribution of working time is scheduled by the employee. It allows the individual working time and hours to be arranged on a day-to-day basis in compliance with both the legal working time limits (10 hours per day and 48 hours per week) and the rules to be pre-established within the framework of the mobile working time regulations.
The time savings account scheme (“compte-épargne temps” – CET) was only recently added to the labour code, in April 2019. It serves as a savings account for overtime and (supplemental) leave days and is meant for businesses that are covered by a collective agreement or an inter-branch agreement providing for a CET, which are required to be negotiated. Only employees with a minimum of 2 years seniority are eligible for a CET.
The CET is held in units of hours and is capped at 1.800 hours.
Upon written request, employees may credit overtime, additional leave days (beyond the legal minimum) that have not been taken, up to 5 days of the legal paid leave, which the employee was not able to take because of illness, maternity or parental leave, additional leave days granted within POT or flextime systems.
As for the use of these hours, the employee must send a written request at least one month in advance. The employer will likely agree to the request, unless the needs of the business or justified wishes of other workers, conflict with the employee’s request. The use of the CET hours is considered equivalent to paid leave, in the sense of the Labour Code. At the end of the employment contract, the CET of the employee will be liquidated and the employer pays a compensatory indemnity to the employee.
Overtime
In Luxembourg, overtime is strictly regulated by law and is only permitted with a prior authorisation from or a notification to the Minister of Employment (Ministre du Travail). Where permitted, overtime is limited to two working hours per day and within the limit of 48 hours per week. For any overtime worked, employees are entitled to compensation in salary or free time. Sunday work is generally prohibited, but there are several exceptions. Employees who work on a Sunday are entitled to a special compensatory rest of either half a day or an entire day and a 70% premium on the normal rate of pay. Night work must be compensated with a salary supplement of 15%, according to the law, where a collective bargaining agreement applies and in the HORECA (hospitality) sector.
Employer’s Obligation to Provide a Healthy and Safe Workplace
The employer must ensure the health and safety of employees in all aspects related to his/her work. He/she must care for both the physical and mental health of his/her employees; stress and burnout must also be taken into account.
During the Covid-19 pandemic, it was naturally understood that the employer’s obligations regarding safety and health were extended to include the implementation of all Covid-19 related measures, such as wearing face masks, ensuring physical distance of at least 1,5 meters between people, disinfecting regularly, etc.
Employer’s Obligation to Provide a Healthy and Safe Workplace
The Labour Code places an obligation on the employer to evaluate and identify the risks that exist in his/her company and then an obligation to avoid the risks, otherwise, if this is not possible, he/she must tackle them by taking into account advancements and choosing the least dangerous options.
In order to comply with their obligations, employers must take technical measures related to the layout of the premises and the choice of installations, machines, tools and work equipment, which must obviously comply with legal standards.
Employers must also put in place the necessary first aid, fire-fighting and evacuation measures for employees, which must be adapted to the size and type of business. They must designate a sufficient number of employees to be trained in first aid by the employer. Additionally, employers must provide the required personal protective equipment to employees (helmets, glasses, gloves, safety shoes, etc.) where needed. Finally, mention should be made of legislation relating to the exposure of employees to chemical, physical or biological agents that present a health risk. The Labour Code provides the legal basis, but the standards are detailed in many grand ducal regulations.
In addition to technical measures, employers must ensure that employees receive the necessary information about health and safety risks. Oral information may be sufficient, however, when the question arises whether the employee has received the necessary information the burden of proof lies with the employer. Often, the information is numerous and complex. In this case, employee training is required. Employees must receive sufficient, appropriate training specifically geared to their job or function. Training is the responsibility of the employer and must take place during working hours.
Pregnant women, women who have recently given birth and women who are breastfeeding, as well as young people and adolescents still enjoy special protection in terms of safety at work, particularly with regard to the nature of the work performed and the duration of work.
Protection from Retaliation
Under some circumstances, employees may be protected from sanctions when they report certain facts to their superiors or other authorities, or testify in such cases. The most common example is in the context of sexual harassment, where the Labour Code provides that employees who denounce or testify regarding a case of sexual harassment may not be subject to retaliation. Similar principles exist for cases of denunciation of inequality between men and women or in cases of whistleblowing.
