Employment law and labor rights in Luxembourg

The Labour Code, which came into effect in September 2006, unified all Luxembourg’s previous employment legislation. You can therefore expect similar employment contracts and wage regulations when working in any part of Luxembourg.

Here’s what you need to know:

Employment contracts in Luxembourg

Permanent contracts

Employment contracts are generally for an indefinite period, known as CDI (contrat à durée indéterminée). They must be finalised in writing (in duplicate) at the latest on the first day of employment. If there is no written contract, the employee may prove the existence and performance of a working contract in any way. This would generally classify it as an indefinite period contract.

An employment contract must include:

• the identities of the parties involved;
• the date on which work is to begin;
• the workplace;
• the nature of the post and, where applicable, a description of the duties involved;
• normal working hours;
• basic remuneration and any supplements (agreed bonuses or profit-sharing);
• the length of the probationary period, if applicable;
• the duration of paid leave and notice periods to be observed;
• any other additional clause (e.g., collective agreements).

Fixed-term contracts

In certain cases, a precise term of work may be set and a fixed-term contract known as a CDD (contrat à durée déterminée) would be awarded. Fixed-term contracts are for specific, short-term jobs, e.g. for seasonal work or to replace an absent employee; restrictions are in place so that they cannot be used to cover work related to the normal activity of a company for a lasting period. A CDD may not be terminated prior to its completion date, except in cases of serious misconduct.

A CDD should include the following additional information:

• the date on which the contract ends or the minimum length of time for which it will run;
• the name of the employee who has been replaced, where applicable;
• the length of the probationary period, if any;
• the renewal clause, where applicable.

Wages in Luxembourg

Minimum wage

There is a guaranteed minimum wage (Salaire Social minimum, SSM) for all workers hired by an employer under a work contract. The SSM rate is based on the employee’s classification and age.

Unskilled workers over 18 years old receive 100% of the SSM. Fifteen- and 16-year-olds receive 75%, and 17 year-olds 80%. Skilled workers over 18 are covered at a rate of 120%. Since 1 January 2026, the SSM has stood at €2,703.74 a month for an unqualified worker over 18 years old and €3,244.48 for skilled workers.

The guaranteed minimum wage for skilled workers is available to employees performing an occupation based on a vocational qualification acquired through education or a training course recognized by an official certificate (at least a Certificate of Technical and Professional Aptitude, or CATP). Any employee that cannot produce such a certificate must be able to prove a minimum of 10 years’ professional experience.

Gross and net pay

Gross pay includes basic pay and any benefits and additional earnings such as overtime, bonuses, profit-sharing, and earnings in kind. Net pay is the amount actually received by a worker after deduction of social security contributions and Luxembourgish income tax, withheld at source.

Social security contributions and tax in Luxembourg

These are calculated on the basis of a tax file sent to the employer in advance, and are relatively low. The maximum amount to be paid in social security contributions in Luxembourg is five times the minimum wage. Personal income tax in Luxembourg is at one of the lowest rates in Europe. The rate of income tax is set on a sliding scale of 17 progressive steps, with a maximum marginal rate of 42%.

Family allowance contributions in Luxembourg

Family allowance contributions (1.7%) are financed by employers through social security contributions. The employer must send the employee a detailed statement at the end of each month showing how the wage or salary has been calculated. This statement should mention the time period concerned, the number of working hours being paid in total, the rate of pay for the hours worked, and any other payment in cash or kind.

Working time in Luxembourg

Luxembourg law provides for a standard working time of 40 hours per week and eight hours per day. Time spent travelling between home and the workplace is generally not regarded as working time.

In principle, the working day may not exceed 10 hours and total working time may not exceed 48 hours per week, including overtime. In exceptional circumstances, such as urgent work, accidents, or force majeure situations, these limits may be exceeded temporarily in accordance with labour law requirements.

Where daily working hours exceed the standard limit, the average working time must nevertheless not exceed 40 hours per week over the applicable reference period. Depending on the relevant collective agreement or workforce agreement, this reference period may be extended beyond four weeks.

Collective bargaining agreements may also provide for shorter working hours than those established by law.

Rest days

Workers should enjoy a rest period of at least 11 consecutive hours in each 24-hour period. All workers should, in the course of a week, have a minimum rest period of 44 consecutive hours. If they do not, then they must be granted an extra six days of supplementary leave a year under certain conditions.

Sunday work

Sunday work is forbidden apart from in certain sectors of activity or when authorized by the Inspection du Travail et des Mines (Labour and Mines Inspectorate), e.g., managerial jobs, trading in tourist regions, urgent work etc. Working on a Sunday entitles the employee to a pay increase of 70%. Employees may be compensated for each hour worked on a Sunday with additional free time in lieu of the wage supplement.

Night work

Night work means work performed between 22.00 and 06.00. If there is no legal rate, supplements for night work must be set by collective agreement. This supplement must be at least 15%. Young workers and pregnant women may not work nights. For other categories of employees, such work is regulated but not forbidden in principle.

Work on public holidays in Luxembourg

When special company conditions mean that work must be performed on a day that is a legal public holiday, the employee working on that day is entitled to a 100% supplement for each hour worked. If the legal public holiday falls on a Sunday, the employee will receive a further 70% supplement. This also applies to overtime, following the principle of accumulated supplement.

Overtime in Luxembourg

Hours worked beyond the legal working time (eight hours per day and 40 hours per week) when specifically requested by the employer, or when the employer is informed of these, are considered as overtime. Use of overtime working requires prior notification or authorization from the Ministere du Travail (Labour Ministry).

The supplement for each additional hour worked is 40% for all employees (except for upper management), but the principle of one and a half hours’ compensatory rest per hour of overtime worked will continue under the law governing the payment of supplements. This additional hour is exempt from tax and social contributions.

Waivers to the regulations on working hours are provided for certain sectors of activity, such as home help, agriculture, hotels and catering, healthcare and goods transport. Furthermore, the working hours regulations do not apply to river transport firms, fairground establishments or family-run enterprises.

Leave in Luxembourg

Paid leave

At least 26 working days’ paid leave must be given per year. A longer period may be laid down in the applicable collective agreement. Workers must work for an unbroken period of three months for the same employer before they are entitled to take a period of leave. Leave must be granted and taken during the calendar year. In principle, the employee decides when to take the leave. The employer must therefore give reasons if leave is refused.

If the employee has not been able to take all the leave to that (s)he is entitled by the end of the calendar year due to the needs of the company or leave being taken by other employees, outstanding leave may in this instance be carried over and taken by the following 31 March.

War invalids, victims of accidents at work and disabled workers are granted an additional six days’ leave. Miners, and manual workers and technical engineers in the mining industry are given an additional three days leave.

Legal public holidays

There are 10 public holidays laid down in law: New Year’s Day, Easter Monday, 1 May, Ascension, Whit Monday, 23 June (a public holiday to celebrate the Grand Duke’s birthday), Assumption, All Saints Day and 25 and 26 December.

If a public holiday falls on a day when the employee would not have worked (e.g., a Sunday), beneficiaries are entitled to take a day’s leave in lieu of this day within the next three months.

Leave for personal reasons

Luxembourg law grants employees special paid leave in certain personal circumstances. These include:

• marriage or the conclusion of a civil partnership by the employee (three days);
• the birth of a child for the other parent (10 days);
• the death of a spouse, partner, child, parent, parent-in-law, sibling, or certain other close relatives (generally three days, depending on the relationship);
• moving house (two days over a three-year period with the same employer);
• the marriage or civil partnership of a child (one day).

Collective agreements or employment contracts may provide for more favourable leave entitlements.

Leave for family reasons

Employees in Luxembourg are entitled to leave for family reasons (congé pour raisons familiales) where a child is ill, has suffered an accident, or requires the presence of a parent for serious health-related reasons.

The duration of this leave depends on the age of the child and the specific circumstances. The entitlement is granted per child and may be taken in full or split over several separate periods.

Additional leave may also be available in cases involving serious illness, disability, hospitalisation, or exceptional health situations affecting the child.

Parental leave

Employees in Luxembourg are entitled to parental leave (congé parental) for each child, provided they satisfy the applicable social security and employment conditions.

Both parents are individually entitled to parental leave. The first period of parental leave generally follows maternity leave or adoption leave, while the second parent may take leave at a later stage before the child reaches the statutory age limit.

Luxembourg parental leave is flexible and may be taken in several forms, including:

• full-time parental leave of four or six months;
• part-time parental leave over a longer period;
• split parental leave arrangements, subject in some cases to the employer’s agreement.

During parental leave, the parent receives a parental leave allowance paid by the Luxembourg social security authorities. The amount depends on the parent’s income and working time arrangement and is subject to statutory minimum and maximum limits. The current maximum is €4,506.23/month for full-time leave for someone working an average of 40 hours per week.

Special unpaid parental leave arrangements may also exist in certain circumstances under labour law or collective agreements.

Special leave

There are a great many types of special leave: for sport, education and cultural activities, for fire brigade, rescue and lifesaving volunteer activities, for development cooperation, adoption, individual training (80 days out of the entire professional career), language training leave to learn the Luxembourgish language.

Dismissal in Luxembourg

The employer may end the employment contract for a genuine and serious reason linked to the worker’s aptitude or behavior or due to the operational needs of the company, establishment, or department.

If the company has more than 150 employees, the employer must call the employee in for a discussion first. The company must then send written notice of dismissal by registered post. Finally, it must give the reasons for dismissal if the employee requests. Employers must send it by registered letter no later than one month after being given notice.

Where dismissal is made with notice, the employment relationship ends upon expiry of the applicable notice period, which depends on the employee’s length of service:

• less than five years’ service: two months’ notice
• between five and 10 years’ service: four months’ notice
• 10 years or more: six months’ notice

An employer may also terminate the contract with immediate effect in cases of serious misconduct (faute grave). In such cases, the dismissal letter must clearly state the facts and circumstances relied upon to justify the immediate termination.

Resignation in Luxembourg

Under a permanent employment contract, the employee is free to end the working relationship. To do so, s/he should send a letter terminating the contract by registered post. The employer’s signature on the copy of the letter of resignation will also act as an acknowledgement of receipt of the notice of resignation.

Once the notice of resignation has been given, the working relationship will cease at the end of the notice period of between one and three months, depending on the employee’s length of service (half of this period for dismissal).

An employee may, like the employer, withdraw from the employment contract without giving notice should there be serious grounds for doing so. This includes non-payment of wages, for example.

Withdrawal during the trial period

A trial period of between two weeks and six months can be in the employment contract. During this period, each of the parties (employer/employee) may withdraw from the contract, without providing just cause beyond the minimum trial period of two weeks (for which there must be serious grounds), notifying the other party by registered post.

The amount of notice that must be given is one day per week of the trial period when the latter is described in weeks, and four days per month when it is described in months. The notice period is between 15 and one month.

End of a fixed-term contract

The working relationship ends automatically at the end of a fixed-term contract. A fixed-term contract (CDD) may only end before its expiry on serious grounds.

Automatic expiry

The employee’s work contract expires on the date that they can no longer claim a sickness benefit; that’s after 52 weeks’ incapacity for work paid by the National Sickness Insurance Fund (CNS – French: Caisse Nationale de Santé, German: Gesundheitskasse, Luxembourgish: d’Gesondheetskeess), during a reference period of 104 weeks.

Protection against dismissal

The Luxembourg Labour Code protects employees against dismissal during periods of sickness absence, provided that the employee complies with the statutory obligations to inform the employer of the incapacity for work and to submit a medical certificate within the required deadlines.

This protection against dismissal generally applies for a maximum period of 26 weeks from the onset of the incapacity for work.

Once the protection period has expired, the employer may dismiss the employee, provided there is a real and serious reason for dismissal and the applicable dismissal procedures are followed.