Collective services

A collective work or bargaining agreement is a contract on working relations and conditions between a representative union and a company, or group of companies operating in the same economic sector.

The first aim of a collective agreement is to guarantee employees better working conditions than the legal minimum, including higher wages than the minimum wage, as well as a career structure together with a pay scale. It also means improved working conditions and a better reconciliation of work and family life.

The law distinguishes 3 types of collective agreements:

• agreements for one or a group of companies,
• agreements declared to be of general obligation, i.e. applicable to all employers and employees in the sector or branch of activity concerned or to an entire profession,
• framework agreements, which regulate the common minimums applicable in the signatory companies and which are supplemented by subordinate agreements at the individual level of these companies.

In Luxembourg only a representative union is authorized to negotiate and conclude a collective agreement. Representativity is defined by law and can be granted for all sectors or for a single particularly important sector of the economy. At present there are only two unions which are recognised as representative for all sectors of the economy. And the OGBL is the one with the largest number of members and employee delegates across all sectors. The OGBL currently negotiates more than 200 collective agreements.

The OGBL delegates and the central secretaries responsible for a company or sector consult with union members to explore their needs and define the demands for the content of a first agreement or the improvement of an existing one.

The OGBL claims and pursues the aim that all employees working in Luxembourg should be able to benefit from a collective agreement. At present, this is only the case for about half of the employees.

If you would like more information on the agreements currently in force, please contact your professional syndicate (for contact details click here).

In Luxembourg, the social security system comprises the following branches: sickness, maternity, accidents at work, occupational diseases, provision for old age, invalidity, survivor’s pension, family benefits, unemployment, dependence, early retirement, social inclusion income – REVIS. The management of social security is guaranteed by public institutions which are managed by the social partners.

The Joint Commission, which decides on the internal or external redeployment of employees with reduced capacity, includes delegates from the Social Security Medical Control – CMSS, the Agency for the Development of Employment – ADEM, the Ministries of Labour and Health and also delegates from the social partners.

Employees wishing to take legal action against their employer must file a petition with the Labour Court. At the headquarters of the Civil Court, in Luxembourg, Esch-Alzette and Diekirch, there is a Labour Court which is competent for disputes relating to employment contracts, apprenticeship contracts, supplementary pension schemes and insolvency insurance. The Labour Court is composed of a Civil judge who sits as president and two assessors, one of whom is chosen from among the employers and the other from among the employees.

Claimants for social benefits have the right to take legal action against decisions taken by social security bodies. These claims are brought either before the Social Security Arbitration Board – CASS, or, in the event of an appeal against a CASS decision, before the Higher Social Insurance Board.

During the 2019 social elections, the OGBL was able to defend its absolute majority of seats in the Chamber of Employees – Chambre des Salariés – CSL, 35 out of 60. The CSL appoints employee representatives to social security bodies and assessors to labour and social security courts. Due to its majority in the SLC, the OGBL appoints most of these representatives and assessors.

As the aim of the OGBL is to defend the professional, social and economic achievements, rights and interests of its members and of employees in general, whether active or retired, it also does so through its representatives in social security bodies and before labour and social security courts.

Without the OGBL, the social reality in Luxembourg would be very different.

The OGBL has succeeded in preventing, between 2006 and 2013, the structural deterioration of the indexation of wages and pensions. The manipulation of the index undertaken by the government at the time was limited to a simple delay in the time of adaptation, thanks to our trade union resistance. Defence against attacks on our index system will remain a central element of the OGBL’s action.

The OGBL is the only trade union to have demanded for several years a 6th week of legal leave and to have lobbied for this demand. Indeed, legal leave had not been adapted since 1975. The OGBL campaign led to a first improvement for employees with the adoption of the new law increasing the number of annual leave days to 26 days and introducing a new statutory public holiday – Europe Day on 9 May. The OGBL welcomes these measures, which can only be a step towards the 6th week of statutory leave. Others are to follow.

In 2017, the OGBL launched its major national campaign for better wages, which among other things targeted the legal framework by demanding a structural increase of 10% in the social minimum wage – SSM. Although it is the highest in Europe, the SSM does not allow people to live with dignity in Luxembourg. However, anyone who works 40 hours a week must be able to live decently. The OGBL therefore considers the gross increase in the SSM of 0.9% which came into force in July 2019 with retroactive effect from 1 January 2019 only as a first step by the political leaders in the right direction, but also as a first success of its trade union action.

This first step will nevertheless have to be followed by other initiatives to fully satisfy the legitimate expectations of the OGBL. The new Social Minimum Wage Tax Credit – CISSM is one such initiative. It concerns all persons receiving a monthly salary of between €1,500 and €3,000 gross for a full-time job to be transposed by employers at the latest with the payment of the July 2019 salary with retroactive effect to 1 January 2019. The CISSM does not replace the existing tax credit – CIS, but is in addition to it.

The current financial situation of the pension system does not give cause for concern about the sustainability of the system in either the short or medium term. This is why the OGBL demands the immediate withdrawal of certain additional deteriorations already foreseen by the 2013 reform. In addition, the OGBL is committed to the full maintenance of the legal retirement age and early pension rights, the full maintenance of the periodic adjustment of pensions to the evolution of salaries, the recognition of internships in companies, student jobs etc. as contributory periods, in the interest of our youth, so that they can receive good pensions.

Losing one’s job is a painful event in an employee’s life, which leads to many difficulties, both psychological and financial. It is therefore of the utmost importance to seek the help of experts to defend yourself.

Before making a mass redundancy (7 employees in a 30-day period or at least 15 employees in a 90-day period), your employer is obliged to start the procedure in the presence of the staff delegation and to negotiate with the employee representatives with a view to reaching an agreement on the establishment of a redundancy plan. Negotiations are designed to avoid or reduce the number of redundancies and their consequences, through internal redeployment, retraining, reintegration into the labour market and better financial compensation than is provided for by law.

Your OGBL delegates will contact the head of the professional union responsible for your company and therefore the defense of your interests will be our main concern.

In the event of bankruptcy, the employee must declare his or her claim – salary arrears, paid holidays not taken, etc. – to the clerk’s office of the Commercial Court within the time limit set by the bankruptcy declaration. These claims benefit from a privilege which allows them to be reimbursed in priority via a State guarantee (superprivilège).

The OGBL informs you and organizes meetings to draw up your declaration of claim and to obtain your bankruptcy indemnity.

We advise you to register for unemployment the day after the declaration of bankruptcy.

In the event of bankruptcy of your company, we advise you to urgently contact your professional union or contact the SICA of the OGBL. Simply call +352 2 6543 777, contact us or come to one of our 18 branches during office hours. Find the contact details of the SICA agencies here. To ensure that your file can be processed as quickly as possible, please fill in the form and bring it to the appointment.

The OGBL is also calling for the reinforcement of the protection of employees throughout their professional career and this in a logic of securing professional careers. This includes a revision of the legal provisions on the social plan, the job retention plan and collective redundancy to strengthen protection against dismissal.

Strikes are rare in Luxembourg. Although the right to strike is a fundamental right of employees, guaranteed by the national Constitution (Article 11) and by international conventions, it is strictly regulated in Luxembourg.

Prior to any strike, the Office National de Conciliation (ONC) must be consulted if there is a collective bargaining dispute, particularly if the employer refuses to start collective bargaining or if the parties disagree on one or more clauses of the collective agreement to be concluded. The conciliation procedure can be concluded either by signing the collective agreement or by a finding of non-conciliation. Until the ONC has established a non-conciliation, the parties must refrain from any action which could jeopardize the execution of a collective agreement, as well as from any strike or lock-out (employer strike, temporary closure decided by the employer in response to a collective dispute).

Taking part in a strike, decreed under legitimate and lawful conditions, is neither a serious reason nor a serious reason for dismissal. Days of absence are not considered as unjustified, but as actual working days. However, the employer may exclude employees temporarily from employment and payment of wages. This is known as lock-out.

If the OGBL is forced to go on strike in the event of a collective dispute in the context of collective agreement negotiations and after a finding of non-conciliation to force the employer to meet the demands of the employees concerned, the OGBL statutes provide for strike pay in addition to a procedure.