On 18 March 2020, the Luxembourg government declared the “state of emergency”, which has been extended for a period of 3 months by the law of 24 March 2020, enabling the government to quickly implement temporary regulations to deal with the exceptional situation in relation with the Covid-19 pandemic.
In this context, the government had to take urgent measures to help companies to face the reduction of their activity, maintain the economic situation of the country and avoid terminations of employment contracts.
Therefore, many of these regulations concern labour law aspects, and the last months have been very challenging for employers, who had to adapt gradually to these new measures, and face a difficult economic situation at the same time. Indeed, due to the urgency, many regulations lack precision and are subject to different interpretations.
Despite the different state aids, some employers, to save their business, will have no choice but to proceed to terminations for economic reasons, which leaves the question open whether the measures taken are sufficient.
From another perspective, this exceptional situation has permitted to develop new ideas regarding our way of working and organisation in the offices, especially through teleworking. To be seen whether this will have a long-lasting effect in the post-crisis period.
Decrees, orders or guidelines in effect and pertaining to reopening facilities.
- The declaration of the state of crisis, as well as all health measures in response to the pandemic have been introduced by means of the Amended Grand-Ducal Regulation of 18 March 2020. A consolidated version is being updated regularly, incorporating all amendments (first, the restrictions, and then the lifting of restrictions): http://legilux.public.lu/eli/etat/leg/rgd/2020/03/18/a165/consolide/20200529
- As of today, the following aspects are affected by the Regulation: limitations of groupings of people, measures concerning establishments open to public, limitation of economic activities, other protective measures, sanctions etc.
- Furthermore, a multitude of measures has been taken by the government in many different fields of law. A list of all labour law and COVID-19 related specific laws, regulations and amendments (only in French) can be found on our website: https://kleyrgrasso.com/covid-19/droit-du-travail/
- The state of crisis has been extended until 24 June 2020 included by the Law of 24 March 2020 : “Loi du 24 mars 2020 portant prorogation de l’état de crise déclaré par le règlement grand-ducal du 18 mars 2020 portant introduction d’une série de mesures dans le cadre de la lutte contre le COVID-19. ».
- Currently, the house of representatives is discussing two bills of “COVID-19 laws” which will supposedly confirm the end date of the state of crisis, by which some measures taken during the state of crisis are supposed to be either extended or even adopted permanently (such as leave for family reasons, etc.).
Optimal approach to keep track of the latest updates.
- All official communications from the government concerning COIVID-19 are published on this website (English version available):
- It contains all communications form the government, as well as extensive FAQ sections in English.
Further sources of information for updates include:
- Guichet, a government institution for administrative questions, has all the necessary information pages concerning Covid-19 measures (in English): https://guichet.public.lu/en/support/coronavirus.html
- The employment agency ADEM publishes a detailed FAQ about short-time work. ADEM: COVID-19 – Short-time working – FAQ (English)
- A list of all COVID-19-related laws, regulations, amendments, circulars etc. divided by field of law can be found on our website: https://kleyrgrasso.com/news/covid-19/
Government subsidies and special relief resources allocated to support employers, and workers, in their efforts to maintain employment and pull through the crisis.
- A comprehensive list of state measures can be found in the following table (in English), provided by the Government: https://meco.gouvernement.lu/dam-assets/dossiers/Tableau-stab-9avril-EN.pdf
- All updates concerning state aid should be accessible here: https://coronavirus.gouvernement.lu/en/entreprises.html
- One of the Government aid measures that has had the biggest impact on labour law is the short-time working scheme, which has been specifically adapted to the COVID-19 situation. (For more information, see point 11 e) )
Requirements mandated by law or any official guidance.
- All health and safety measures concerning COVID-19 are continually updated and amended in the Amended Grand-Ducal Regulation of 18 March 2020, of which a consolidated version is being updated regularly: http://legilux.public.lu/eli/etat/leg/rgd/2020/03/18/a165/consolide/20200529
Measures typically implemented by employers and the associated legal risks, limitations, obligations and issues to consider.
- The Labour Code provides that the employer is obliged to ensure the health and safety of employees in all work-related aspects and take the necessary measures for the protection of the health and safety of employees (Articles L.312-1 et seq. of the Labour Code). This general rule also applies in the current exceptional circumstances of the COVID-19 pandemic.
- Additionally, the Government decided in a Grand-Ducal regulation from 17 April 2020 that the employer has in addition specific obligations regarding health and safety at the workplace during the state of emergency (i.e. between 16 March and 24 June 2020 for now) linked to the COVID-19 epidemic.
- The employee must concretely review the circumstances in which employees may be exposed to the virus and implement the measures necessary to avoid or, failing this, limit the risk as much as possible.
More particularly, employers must ensure that:
- The rule of distance (2 meters minimum) must imperatively be respected. If not, people should wear masks or any other protective equipment to cover mouth and nose, which should be available to employees,
- premises and floors are regularly cleaned, work surfaces are cleaned and disinfected, employees are provided with soap, water and hydro-alcoholic gels,
- set up workstations and other premises or workplaces in which employees are likely to exercise their professional activity set up collective protection equipment which ensures the protection of employees in relation to other people;
- inform and train, in collaboration with the staff delegation, the employees on possible health and safety risks, the precautions that need to be taken, the wearing and use of protective equipment and clothing, as well as hygiene measures taken in the context of these exceptional circumstances linked to the COVID-19 epidemic and give them the appropriate instructions, post signs indicating the risks and the preventive measures taken in relation to these exceptional circumstances linked to the COVID-19 epidemic.
- However, there is no obligation for employers to conduct testing protocols or temp scanning.
- It is to be noted that the implementation of the above rules is subject to the control of the Labour Inspectorate (ITM- Inspection du travail et des Mines) and the Occupational Health and Environment Division of the Health Ministry. In the event of a breach, companies may be subject to administrative and criminal sanctions (fines and imprisonment under certain circumstances).
- The following guidelines have been published with regard to health and safety obligations for employers:
- Ministry of Health: Temporary health recommendations, including specific guides per business sector. Unfortunately, it is only available in French at this time.
- Inspectorate of Labour and Mines (Inspection du travail et des mines) : Safety guide for employers (only in French).
- Service de Santé au travail multisectoriel (in French) : https://www.stm.lu/news/covid-19-documents-utiles/
Policies and procedures for telework once the business reopens.
- As of today, despite recommendations from the Government to implement teleworking whenever possible for reasons of health precautions, there is no “right to teleworking” in Luxembourg. In fact, employers may refuse employees requests for teleworking.
- Employers may however impose teleworking on their employees for health and safety reasons, if possible and compliant with their functions and employment contract.
- Different rules are applicable whether the employee is working from home on a regular basis or only occasionally. If the employee works from home on a regular basis (for example the employee is working every Friday from home would be a regular regime), an addendum to the employment contract must be signed and the employer should respect a certain number of obligations governed by the legal provisions of a Grand-Ducal regulation dated 15 March 2016. Therefore for occasional teleworking (which was applicable during the Coronavirus crisis), no specific arrangements need to be organized, apart from the respect of the confidentiality and data protection points. It is however recommended to communicate some common guidelines/a policy to the employees working from home on an occasional basis; this is relevant from an insurance perspective if the employee has a work-related accident while working from home. Ideally, the employee should confirm his start and end time of a working day spent at home (by e-mail (sent to the line manager), via the clocking system etc.).
- It is important to note that as in Luxembourg many employees are cross-border workers, working from home (i.e. from another country) may have tax or even social security implications for them leading to a possible loss of salary, if the duration of work performed from home exceeds a certain number of days per year. Although the Luxembourg government managed to negotiate with France, Germany and Belgium for the non-application of the usual tax-regime during the state of crisis, it is unclear as of today what would be the tax implications in the future once the business reopens.
Management of quarantine, childcare and medical leave for employees affected by COVID-19.
- Employees who are infected with COVID-19 and/or need to be quarantined, need to contact a medical professional by phone, and through a “teleconsultation”, the medical professional will issue a sick leave certificate for the employee.
- With regard to employment law, this situation is treated like any other sick leave.
- In the context of the measures adopted by the Government to contain the spread of the COVID-19 coronavirus, a specific procedure has been set up to allow parents to take leave for family reasons if they do not have any solution to look after their child(ren) under 4 years old, or aged from 4 up to 13 if it has not been possible to find them a place in a childcare structure for the period from 25 May to 15 July 2020. This special leave is treated as sick leave and the employer is reimbursed 100% by the National Health Fund.
- If the employee is not sick, it is always possible to ask him/her not to come to the office. If telework is not possible the employer would have to grant to this employee extraordinary leave.
Employees who fear infection and refuse to work.
- Employees may not refuse coming to work out of fear, provided the employer has implemented all required health and safety measures. (Article L. 312-1 of the Labour Code).
- However, according to Grand-Ducal regulation from 17 April 2020, in the event of a serious, immediate and unavoidable danger, an employee may leave his/her workstation or the dangerous area without being sanctioned. Any termination on those grounds will be deemed abusive.
- Such behaviour from the employee may however in our view only be acceptable if the employer has not taken the necessary measures in relation with the COVID-19 epidemic to protect the employees and/or if due to specific circumstances the employee was indeed be in a “serious, immediate and unavoidable danger” (for example a business trip in a high risk zone).
- Possible disciplinary measures may thus only be considered on a case-by-case basis.
Disclosure of employees who are infected.
- Employers are not required to notify authorities. In fact, the CNPD, the national commission for the protection of data in Luxembourg, considers that employers must refrain from collecting in a systematic and generalized manner, or through individual inquiries and requests, information relating to possible symptoms or health information presented by an external person or an employee as well as their relatives.
- The CNPD’s guidelines concerning COVID-19 can be found here (in English):
To what extent can employers implement the following cost-reduction strategies as a result of COVID, and what are the primary limitations on each?
The exact mechanism of furloughs does not exist in Luxembourg. However, there is a possibility for short-time work (see point 11 e.)
- Salary reductions.
No specific rule has been implemented enabling employers to unilaterally reduce salaries due to Covid-19.
Salary reductions can be agreed upon by signature of a contract amendment by mutual consent.
Otherwise, the usual procedures in case of unilateral modification of an essential part of the employment agreement apply (and which is the same procedure as for a dismissal).
Please note that during COVID-19, while a company benefits from short-time work, the employer undertakes not to do any dismissal for economic reasons as long as the State aid is granted.
Otherwise, if the employer wants to dismiss at least 7 or more employees over a period of 30 days or at least 15 or more employees over a period of 90 days, they must apply a collective redundancy procedure, which basically entails 4 steps:
- informing the National Employment Agency (ADEM) and the staff representatives or the employees directly if the business regularly employs less than 15 persons;
- negotiation of a social plan;
- implementing the social plan;
- requesting tax exemption for voluntary departure or severance pay, if applicable.
Please note that during the COVID-19 crisis, the deadlines which are normally applied during the negotiation of a redundancy plan are suspended within the framework of a collective redundancy, such as:
15-day limit for negotiations of redundancy plan, and in absence of agreement, signature of non-conciliation report, submission of the case to the National Conciliation Service, summons to meet with the conciliation committee, deadline of maximum 15 days until decision is reached (signature of redundancy plan or redundancies).
This means for businesses employing 15 or more employees that, during the sanitary crisis, it is not possible, without the approval of the employee representatives, to dismiss for economic reasons more than 6 employees over a period of 30 days or 14 employees over a period of 90 days.
- Facility closure.
Yes, the usual procedures apply.
- Short-time work
To maintain employment, and avoid redundancies, the Luxembourg labour law foresees the possibility for companies to use different short-time working schemes under certain conditions, and according to the difficulties they meet.
For the time of the pandemic (and until 30 June 2020), the Government has implemented a specific scheme for short-time work due to COVID-19. The application procedures are fast-tracked, simplified and generalized, in order to accelerate the employers’ access to help.
The employment agency ADEM has published a detailed FAQ about short-time work. ADEM: COVID-19 – Short-time working – FAQ (English)
Further information and the needed forms are available on guichet.lu: https://guichet.public.lu/en/entreprises/sauvegarde-cessation-activite/sauvegarde-emploi/chomage-partiel-technique/chomage-partiel-coronavirus.html
For the period after 1 July 2020, the Government has announced to replace the currently applicable “short-time work for COVID-19 reasons” by a slightly amended version of another existing mechanism, called “Short-time working due to structural economic problems”.
To benefit from this amended mechanism, companies that also intend to terminate employment contracts for economic reasons will normally have to present a recovery plan (small businesses), or even a job retention plan (for businesses of 15 or more employees); for a job retention plan, the approval of the employee representatives (or unions in case a collective bargaining agreement exists) is requested.
In addition, apart from the sectors which are the most affected by the crisis, the possibility for companies to request short-time work will be limited to a specific percentage of employees which is decreasing over time.
There will be simplified or even ultra-simplified digital procedures available.
Tips, recommendations and common pitfalls.
In order to optimize the working condition of employees when returning to work after the confinement, we recommend the following.
- In open space structures, we highly recommend a gradual return to work scheme, such as alternating working groups (groups alternating between office time and teleworking)
- Providing all necessary health and safety material (see above)
- Placing partitions between work areas, wherever a distance of 2 meters cannot be ensured
- Enabling employees who are vulnerable to work from home as much as possible
- While the employer may not prohibit employees from travelling internationally, we would advise to provide health and safety recommendations and information and encourage employees to carefully consider them.