POPULATION
0.7m
CURRENCY
€ (EUR)
CAPITAL CITY
Luxembourg
Luxembourg, officially the Grand Duchy of Luxembourg, is a country in Western Europe. Known for its stunning landscapes, diverse culture, and innovative technology, Luxembourg is a popular destination for tourism and cultural exploration. From the bustling streets of Luxembourg City to the serene landscapes of the Ardennes, Luxembourg offers a wealth of cultural and natural attractions.
Luxembourg's economy is diverse, with key sectors including financial services, manufacturing, and tourism. The country is a major exporter of goods and a global leader in innovation. Luxembourg's skilled workforce and strong infrastructure make it an attractive destination for international business.
Disclaimer: This content is for informational purposes only. We do not guarantee the accuracy or completeness of this content. It is not legal advice and shall not be relied on as such.
All employment contracts, whether for an indefinite or fixed term, must be concluded in writing. Written labor agreements must include such information as the nature of work, salary and benefits, duration of the paid leave, working time, and length of the notice period, etc.
Per the Labor Code of Luxembourg, the employment contract, whether for an indefinite or fixed term, must be made in writing and include specific information. However, in the absence of a written document, the Labor Code of Luxembourg states that the employee may establish the existence and terms of the employment relationship by any means of proof.
The Labor Code of Luxembourg does not explicitly recognize the use of implied contracts. It does, however, acknowledge that in the absence of a written document, the employee may establish the existence and terms of the employment relationship by any means of proof.
The Labor Code of Luxembourg dictates that working hours cannot exceed 8 hours per day and 40 hours per week. In exceptional cases, working hours may be extended to up to 12 hours, compensated with an extra holiday, so that the average weekly working hours do not exceed 40 hours over four weeks. The standard working time of night workers may not exceed eight hours, on average per 24-hour period calculated over 7 days.
Employees must be employed by an organization with the capacity for remote work in order to request the option. Any employee of a Luxembourg company governed by private law hired under a fixed-term or indefinite-term contract can participate in telework. When remote work occurs consistently, rules must be agreed upon by both parties in writing. Employers are prohibited from contacting employees during non-working time in violation of their right to disconnect.
January 1 - New Year's Day
April 21 - Easter Monday
May 1 - May Day
May 9 - Europe Day
May 29 - Ascension Day
June 9 - Whit Monday
June 23 - National Day
August 15 - Assumption Day
November 1 - All Saint's Day
December 25 - Christmas
December 26 - Saint Stephen
In Luxembourg, employers can include a probationary period in employment contracts, but this must be clearly documented in writing before the employee starts. If no written agreement is made, the contract is automatically considered permanent, and no contrary evidence can be presented. Probationary periods generally last between 2 weeks and 6 months, though specific rules apply based on the employee's qualifications or salary. For employees with lower qualifications, the probation is limited to 3 months, while those earning a high salary may have a probationary period up to 12 months.
For contracts without a fixed term, the probationary period is determined based on the contract's minimum duration. The probation period also counts toward the maximum allowable duration for a fixed-term contract. During probation, either party can terminate the contract under specific rules. If not terminated by the end of the probationary period, the contract automatically becomes permanent. Temporary employment contracts also allow probationary periods, which are limited to 3 days for contracts of 1 month or less, 5 days for contracts over 1 month, and 8 days for contracts exceeding 2 months.
In Luxembourg, the required notice period for termination of an employment contract depends on the duration of the employee's service and is as follows:
The notice period can be waived if the responsible party pays compensation in lieu of notice to the other party.
The employer can dismiss the employee without notice in cases of gross misconduct.
Luxembourg's Labor Code states that employees who are dismissed for a reason other than serious misconduct must be given notice of dismissal. If they have worked in the business for 5 or more years, they are also entitled to severance pay. Severance pay amount is based on an employee's length of service as follows:
The employer and the dismissed employee may also agree on a voluntary severance package.
In addition, businesses with fewer than 20 employees may:
The employer must specify the option they have chosen in the letter of dismissal.
The Labor Code of Luxembourg states that employee salaries cannot be below the social minimum wage.
The current social minimum wage is EUR 2,570.93 (euros) per month for employees aged 18 and over. The applicable minimum wage is increased by 20% for skilled workers and decreased by 20% to 25% for employees under 18.
The Labor Code requires employers to pay wages at the end of each month and within 5 days of contract termination. The statute of limitations for unpaid wages and any other type of remuneration is 3 years.
Employees in Luxembourg can choose compensatory time off or extra remuneration for overtime work. Employers must compensate employees working overtime by granting them 1.5 hours of time off per hour of overtime worked. These hours can be used in the form of compensatory paid leave or be put into a time savings account. Each hour of overtime work is paid at a rate of 140% of the hourly salary of the employee. Work done on weekly rest days is compensated at a rate of 170% of the hourly pay.
The pay of employees who work on a public holiday is 200% of their regular hourly wage. Annual leave pay is 100% of employees' wages.
Luxembourg is a part of the Schengen Area and offers the following visas:
Third-country nationals who wish to carry out a salaried activity in Luxembourg for more than 3 months must obtain a residence permit for working. Citizens of EU member countries do not require a permit to work in Luxembourg.
The application for a residence permit must be submitted to the Immigration Directorate of the Ministry of Foreign and European Affairs within 3 months of entry into Luxembourg.
The first residence permit for employees is valid for a maximum of 1 year for a particular job in 1 sector with all employers. As of the first renewal, the residence permit is renewable for a maximum duration of 3 years and gives access to any sector and any profession.
Population 0.7m
Population in total, including all residents regardless of legal status © 2024 - WBG • EUROSTAT
92.3%
Urban Population
98.8%
Internet access
98.8%
Banking access
100%
Mobile phone access
Population: The World Bank: World Development Indicators: World Bank Group • World Population Prospects, United Nations (UN), uri: https://population.un.org/wpp/, publisher: UN Population Division; Statistical databases and publications from national statistical offices, National Statistical Offices, uri: https://unstats.un.org/home/nso_sites/, publisher: National Statistical Offices; Eurostat: Demographic Statistics, Eurostat (ESTAT), uri: https://ec.europa.eu/eurostat/data/database?node_code=earn_ses_monthly, publisher: Eurostat; Population and Vital Statistics Report (various years), United Nations (UN), uri: https://unstats.un.org, publisher: UN Statistics Division
Urban Population: The World Bank: World Development Indicators: World Bank Group • World Urbanization Prospects, United Nations (UN), uri: https://population.un.org/wup/, publisher: UN Population Division
Internet access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU), uri: https://datahub.itu.int/
Banking access: The World Bank: World Development Indicators: World Bank Group • FINDEX, WBG (WB), uri: https://www.worldbank.org/en/publication/globalfindex
Mobile phone access: The World Bank: World Development Indicators: World Bank Group • World Telecommunication/ICT Indicators Database, ITU (ITU)
All employees are entitled to a paid recreational leave of 26 days per year, regardless of their age. Sundays and statutory holidays are not included in annual leave. If, during the annual leave, the employee falls sick, the days of sickness recognized as such by the medical certificate are not considered a part of paid annual vacation.
The right to annual leave is acquired after 3 months of work with the same employer.
The leave can be taken all at once or split on request of the employee, in which case one of its parts must be at least 2 weeks long. The leave must be taken within the calendar year or postponed until March 31 of the next year.
Employees are entitled to paid sick leave for illnesses, with the condition that they submit a medical certificate after the third day of incapacity. In the event of urgent hospitalization, the employee has 8 days from the date of the hospital admission to send a medical certificate to the employer. Employees are paid 100% of their salary for up to 77 days within 18 months. If the sick leave exceeds this period, the employee may be eligible for different compensation. During this period, the employer can file for reimbursement from the government, which compensates up to 50% of the costs after the first 3 days of illness.
Additionally, employees are entitled to 1 day per year for urgent personal matters and 5 days to provide personal care or personal assistance to a family member or to a person who lives in the same household as the employee and who requires considerable assistance for a serious medical reason.
The Labor Code of Luxembourg grants a total of 20 weeks of paid maternity leave to pregnant employees: 8 weeks before and 12 weeks after childbirth.
It is prohibited to employ a pregnant woman in night work. Pregnant employees and nursing mothers cannot be required to work overtime.
During the employee's absence due to maternity leave, the employer is required to hold the job for the employee, or, if it is not possible, a similar job corresponding to her qualifications and with at least an equivalent salary. An employee cannot be dismissed during her maternity leave.
According to Luxembourg's labor law, employees receive 10 days of paid paternity leave in case of the birth of a child or adoption of a child under the age of 16 years. The employer must be notified 2 months prior to the expected start date on which the employee intends to take the leave.
The state covers the costs for paternity leave from the 17th hour of leave on specific request from the employer to the Ministry of Labour, Employment, and the Social and Solidarity Economy.
The legal retirement age in Luxembourg is 65 years. Employees are eligible for an old-age pension if they have paid mandatory, optional, or retroactive purchase insurance premiums for at least 120 months.
The old-age pension consists of two components: flat-rate increases and proportional increases. The flat-rate increases are granted according to the duration of the insurance. The proportional increases are granted according to the contributory income realized during the insurance career. The minimum old-age pension is 90% of the reference amount when the insured has completed a qualifying period of 40 years (compulsory insurance periods, continued insurance, optional insurance or retroactive purchase periods, additional periods). If the insured has not completed the 40-year requirement but has at least 20 years of insurance, the minimum pension is reduced by a fortieth for each missing year.
Both the employees and employers make contributions to social security.
Survivors of an insured member who had paid at least 12 contributions or persons receiving invalidity/old-age pension are eligible for benefits. Survivors include spouses, partners, and children of the deceased, subject to certain requirements.
Pension for the spouse or partner is made up of 75% of the proportional increases as well as the total flat-rate supplements and special flat-rate increases to which the pensioner or the insured person was or would have been entitled. Pension for a child is 25% of the proportional increases and special proportional increases, as well as 33.33% of the flat-rate increases and special flat-rate increases to which the beneficiary of the pension or the deceased insured person had or would have been entitled.
If the deceased member did not fulfill eligibility criteria, survivors receive all contributions made by that member or on his or her behalf as a lump sum grant.
Social security insurance in Luxembourg provides invalidity benefits to insured persons under 65 years of age who have suffered a loss of working capacity such that they are prevented from exercising their profession.
Disability pension for temporary disability is paid for a maximum of 6 months. The disability pension for permanent disability consists of flat-rate increases, special flat-rate increases, proportional increases, and special proportional increases. The minimum disability pension is 90% of the reference amount when the insured has completed a qualifying period of 40 years, equal to EUR 2,244.82 (euros) per month.
Disabled pensioners who require regular assistance from others to carry out basic day-to-day tasks for at least 3.5 hours a week for a minimum of 6 months are also eligible for long-term care insurance benefits.
In Luxembourg, the minimum age for employment is 15 years. Children under the age of 15 years may only be employed in artistic activities or other light work with permission from their parents or guardians. The work of young people under the age of 18 years is only permitted on condition that it does not involve their economic exploitation. Employees under 18 years can only be employed if they are found to be fit for the job in a medical examination.
Young employees' working hours must not exceed 8 hours per day and 40 hours per week. Overtime and nighttime work are prohibited. After 4 hours of work, employees under the age of 18 are granted paid or unpaid rest time of at least 30 minutes.
The minimum salary for employees aged 17 to 18 cannot be less than 80% of adult employees' pay for the same work, and for employees ages 15 to 17, wages must be at least 75% of adult employees' pay for the same work.
Unemployment 5.9%
Share of the labor force that is unemployed, but available for and seeking employment © 2024 - WBG • ILO
61.3%
Labor force population share
46.4%
Female share of labor force
83%
Healthcare access
Unemployment: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025.
Labor force (total): The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Labor force population share: The World Bank: World Development Indicators: World Bank Group • ILO Modelled Estimates database (ILOEST), ILO (ILO), uri: https://ilostat.ilo.org/data/bulk/, publisher: ILOSTAT, type: external database, date accessed: January 07, 2025
Female share of labor force: The World Bank: World Development Indicators: World Bank Group • ILO (ILO), type: estimates based on external database; United Nations (UN), publisher: UN Population Division; Staff estimates, WBG (WB)
Healthcare access: The World Bank: World Development Indicators: World Bank Group • GHO, WHO (WHO), uri: https://www.who.int/data/gho/data/themes/topics/service-coverage
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