Employment Contract in Luxembourg

When it comes to employment, Luxembourg companies must comply with its local legislation which is the Labor Code, but also with all EU directives related to this kind matters. The Luxembourg Employment Law was enabled in 2006 with the main purpose of providing specifically for labor contracts and situations arising from them. Previously, work relations between employers and employees and labor contracts were governed by the Civil Code in Luxembourg.

Foreign investors seeking to open companies in the Grand Duchy, can count on our Luxembourg company formation agents for assistance.

Signing an employment contract in Luxembourg

All companies in Luxembourg hiring employees are required to make their offer based on a labor contract. The employment agreement must be written and must contain several elements which will distinguish it from other contracts.  A Luxembourg labor agreement must contain:

• -          the subordination of the employee to the employer, which is the main element of the contract;
• -          the services to be offered under the contract;
• -          the remuneration provided in exchange for the services.

The law recognizes two types of employment contracts in Luxembourg:

• -          the indefinite or permanent labor contract;
• -          the fixed-term labor contract, which cannot exceed 24 months in duration;
• -          the part-time contract, which enables an employee to work less than 40 hours per week.

It must be known that managers and directors of companies in Luxembourg do not fall under the category or usual workers, therefore they will not abide by the Employment Law. Our company registration representatives in Luxembourg can offer more information on employment conditions for company managers.

What are the contents of a Luxembourg labor contract?

Foreign citizens are also allowed to work in the Grand Duchy based on a work visa. No matter whether the employees are residents or foreign, all employment contracts signed and registered in Luxembourg must contain the following:

• -          details about the employer and employee, such as names and addresses;
• -          the date of employment and first day of work;
• -          the place where the work will take place;
• -          the wages;
• -          the working schedule;
• -          the probation period;
• -          information on the notice of leave;
• -          information on paid leave.

For complete information on the registration of employment contracts, please feel free to contact our company incorporation consultants in Luxembourg.