Parliament approves long-awaited amendments to Luxembourg Labour Code

At a glance

• Luxembourg Parliament approved amendments to the Labour Code on 24 July 2024, in line with the transparent working conditions directive (Directive), published on 4 August 2024.
• New mandatory provisions for employment contracts include details on overtime, termination rules, probationary periods, and training rights.
• Exclusivity clauses are prohibited, allowing employees to have additional jobs outside normal working hours if it doesn’t conflict with the employer’s interests.
• Fixed-term contract trial periods must be between two weeks and a quarter of the contract’s duration.
• Workers with at least six months of seniority can request a transition to more secure employment forms, with employers required to respond within one month. Non-compliance can result in fines.

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On 24 July 2024, the Luxembourg Parliament voted to approve the act amending the Luxembourg Labour Code (Act) in accordance with the Directive. It was published on 4 August 2024.

The purpose of the Directive is to promote a more transparent and predictable labour market for all workers in the EU who are bound by one or more employment contracts within the meaning of the law, collective agreements or practice in force in each member state.

This Luxembourg implementation Act introduces some major innovations:

New mandatory provisions to be included in employment contracts (eg for employees, apprentices, temporary workers) such as details on the overtime scheme, on the termination rules, on the probationary period, the right to training if applicable, information on the distinction between the base and supplementary pay, if any. With regards to the probationary period, training right, termination rules, sole references to relevant provisions of the Labour Code can be made instead of detailed clauses on these topics.

Prohibition of exclusivity clauses which forbid an employee, temporary worker or apprentice from exercising, outside the normal working hours agreed in the contract, another employment relationship with one or more employers, providing it's not affecting the business’ interests of the employer (eg business confidentiality, health and safety reasons, conflict of interests).

New duration of the trial period for fixed-term contracts, which may not be less than two weeks, or more than a quarter of the duration fixed in the fixed-term contract.

Possibility for workers to transition to another form of employment with more predictable and secure working conditions ie workers with at least six months of seniority with the same employer can ask for a conversion from a fixed-term employment to an indefinite-term employment contract or from a part-time to a full-time scheme. The employer must, within one month of receiving the request, either convert the employee's contract into an indefinite one or provide detailed written motivation to the employee.

Failure to comply with these provisions can be sanctioned with a fine of between EUR251 and EUR5,000 per concerned employee / apprentice / temporary worker – which can be doubled for repeat offences.

New employment contracts signed from 4 August 2024 should be compliant. Regarding employment contracts signed before 4 August 2024, employees will be entitled to ask that their employment contracts be updated, in which case the employer has to comply within two months of receiving the request.