Luxembourg flag Luxembourg: Operating a Business in Luxembourg

Work conditions in Luxembourg

The Active Population in Figures

Labour Force 302,757313,152320,185

Source: International Labour Organization, ILOSTAT database

Total activity rate 70.00%70.77%71.66%
Men activity rate 73.85%74.35%76.18%
Women activity rate 65.95%66.97%66.88%

Source: International Labour Organization, ILOSTAT database


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Working Conditions

Legal Weekly Duration
The Law allows for a duration of 40 hours per week and 8 hours per day. The daily working time may not exceed 10 hours.
Retirement Age
Working Contracts
Employment contracts are regulated by law. Collective agreements and individual negotiations complement it.
The terms of the employment contracts are very rigid.

A work contract is either signed for an indeterminate period (Contrat à Durée Indéterminée/ CDI), which it is most often the case, or for a fixed term (Contrat à Durée Déterminée/ CDD). The CDD cannot last more than 24 months, including renewals. It can only be renewed twice and only if the initial contract includes a renewal clause. The Law strictly defines the framework of using a fixed-term contract. It is contracted for the accomplishment of precise and temporary tasks in a company.

Labour Laws
Consult Doing Business Website, to obtain a summary of the labor regulations that apply to local entreprises.

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Cost of Labour

Minimum Wage
In 2021, the monthly minimum wage in Luxembourg is EUR 2 202, according to Eurostat.
Average Wage
In 2019, the average salary in Luxembourg is €58,520 a year (OECD, latest available data).
Social Contributions
Social Security Contributions Paid By Employers:

The employer's social security contribution rate is between 12.01% and 15.06%:

  • pension: 8%
  • sickness: 2.8 - 3.05%
  • accident insurance: 0.675% - 1.125%
  • employers' mutual insurance: 0.53% - 2.88%
  • maximum annual income base subject to contributions: 132,115.80 euros (index 834.76).

Social Security Contributions Paid By Employees:

The employee’s part of social security contributions ranges between 12.20% and 12.45%.
Employee’s part (capped):

  • pension: 8 %
  • sickness: 2.8 - 3.05 %
  • maximum annual income basis subject to contributions: EUR 132,115.80 (index 834.76).

Non-tax-deductible contributions (uncapped):

  • Dependence insurance: 1.4 % minus a deduction of EUR535.50 per month on gross salary. No ceiling is applicable.

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Social Partners

Employer Associations
UEL - Union of Luxembourg Enterprises
Social Dialogue and Involvement of Social Partners
Luxembourg enjoys a rather calm social climate. The majority of industrial workers are associated with the dominant political party.  Trade unions are active in several fields but they mainly defend union interests in collective negotiations during meetings with the employer, public and social authorities. They also provide free judicial aid.
Labour Unions
OGBL (in French)
Unionisation Rate
Around 50% in 2007.
Labour Regulation Bodies
Ministry of Labor

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Latest Update: May 2024

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