Employment Law in Luxembourg

Employment Law in Luxembourg

Updated on Wednesday 14th March 2018

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Employment in Luxembourg falls under the regulations of the Labor Code first enabled in 2006 which provides for both national and foreign citizens working in the Grand Duchy. However, it must be taken into accounts that nationals of certain countries are required to apply for an employment pass before starting to work in LuxembourgEmployment regulations are enforced by the Ministry of Labor and Employment.

Our law firm in Luxembourg can offer information on the Employment Law and the requirements for hiring foreign employees.

The main laws governing employment in Luxembourg

The most important law related to hiring employees in Luxembourg is the Labor Code, however, as an EU country, the Grand Duchy will also comply with the EU regulations imposed to all member states. Also, Luxembourg has signed various international agreements related to labor and resolution of employment disputes which must be considered by local companies hiring employees. It should also be noted that Luxembourg is part of the International Labor Organization.

With respect to the main institutions related to employment in Luxembourg, these are:

  • - the Ministry for Labor and Employment;
  • - the Inspectorate for Labor and Mines;
  • - the National Employment Agency;
  • - the National Employment Fund;
  • - the Conciliation Office.

The Conciliation Office is in charge of mediating disputes related to employment matters.

Labor contracts under the Luxembourg Employment Law

The Luxembourg Labor Law makes a clear distinction between employees who are categorized at it follows into regular workers and senior executives. However, the employment contract will have the same form for both types of employees. Labor contracts in Luxembourg are regarded as contracts through which an employee agrees to work under the authority of an employer. There are two types of work contracts in Luxembourg:

  • -          fixed-term employment contracts;
  • -          permanent employment agreements.

Fixed-term labor contracts cannot exceed 2 calendar years and can only be renewed twice.

Labor contracts in Luxembourg must contain the following elements:

  • -          the name and address of both employee and employer;
  • -          the effective date of employment;
  • -          the location where the work will be carried;
  • -          the services to be rendered;
  • -          the remuneration for the services rendered;
  • -          the working hours;
  • -          information about the employee’s registration for social security purposes;
  • -          the taxes to be withheld from the salary.

Our lawyers in Luxembourg can provide you with information about content of employment agreements.

Rights of employees in Luxembourg

No matter the type of contract concluded, all employees have certain rights attached to the obligation of fulfilling their service for the Luxembourg company employing them. The Employment Law in Luxembourg establishes a national minimum salary which depends on the qualifications of the workers. Also, workers are entitled to paid leave, sick leave and payment for the duration of the leave. The employee is also protected against dismissal for the duration of the sick leave. For employees working under extraordinary conditions, other rights may arise.

Hiring foreign employees in Luxembourg

Luxembourg is a small country in which often the local workforce cannot complete the needs of the local labor market. This is why many Luxembourg companies are required to hire foreign workers. It should be noted that employees coming from EU and EEA countries do not need a work permit, however all other third-country workers must obtain such visa before entering Luxembourg. Once arrived in the country, these will benefit from the same rights as local workers.

For full information about the Luxembourg Labor Law or hiring foreign employees, do not hesitate to contact our local law firm.