1. Legal Framework
The Luxembourg social security system has been codified by the law of 13 May 2008 into a single unified system. The CNS (Caisse Nationale de Santé) and the CNAP (Caisse Nationale d’Assurance Pension) are the two national health-care and pension insurance administrative units. A central administrative unit called CCSS (Centre Commun de la Sécurité Sociale) is in charge of the data processing, membership records and contributions of all affiliates to the various schemes.
2. Required Contributions
The rates of contributions apply to compensation and earnings up to a maximum of five times the minimum reference social wage. The employee’s and employer’s contributions are the same (about 3,05 % for sickness and maternity and 8 % for retirement).
The health-care insurance organizes the reimbursement of medical costs and compensation for sick leave, maternity leave, adoption leave, leave for family reasons and also dependence. The pension insurance has the main tasks to allocate statutory pensions to its affiliates and to grant loans for construction or renovation. Invalid pensions are also envisaged in Luxembourg law. Accident insurance is financed by employer’s contributions.
4. Required Maternity/Sickness/Disability/Annual Leaves
In the event of absence from work due to illness duly notified by informing the employer on the first day of absence and providing with a medical certificate the latest on the third days of their absence, all employees under the age of 68 are entitled to statutory sickness pay for a period of up to 52 weeks within a reference period of 104 weeks.
The employer must continue to pay the employee’s salary and receives reimbursement of 80 % of the costs from the Luxembourg Mutual Insurance Scheme.
Employees on sickness leave are protected against dismissal for the first 26 consecutive weeks of their absence.
If an employee is still unable to work after the end of the statutory sickness pay, he may apply for invalid pension.
In Luxembourg law, the contract lapses with immediate effect after a period of 52 weeks of absence for illness.
Maternity leave, provided by the Labour Code, starts eight weeks before the expected date of delivery and continues eight weeks after the actual date of delivery. The postnatal period can be extended by four weeks in some cases.
In order to be granted maternity benefits during maternity leave, the employee or self-employed worker must have been affiliated with the mandatory sickness and maternity insurance fund for at least 6 months during the 12 months prior to the maternity leave.
Maternity benefits are paid during antenatal and postnatal leave.
Parental leave is the leave taken by parents of a child who is less than five years old. This leave may be taken part time for one year or full time for six months. A draft law has been submitted to the Chamber of Deputies on January 2016 to change the parental leave duration and conditions.
5. Mandatory and Typically Provided Pensions
The normal old age pension is generally granted at the age of 65, provided a 120 months contributory period of compulsory, voluntary or elective insurance or purchase periods has been completed.
There exists however exceptions to this minimum retirement age where the worker can retire at the age of 57 or 60 under certain conditions.