Our Expertise
Managing a global workforce in Luxembourg
Managing a workforce in Luxembourg involves navigating a landscape shaped by a multilingual environment and a diverse cultural fabric. The country's robust labour laws emphasise fairness and employee welfare, necessitating a meticulous approach to compliance and employee management. TopSource Worldwide offers tailored EOR solutions for workforce management in Luxembourg, covering everything from payroll processing and tax compliance to employee benefits administration, all aligned with local laws and customs.
Extensive expertise
Our team of experienced, knowledgeable staff collectively provide up-to-date employment information across 180 countries, so you can always get accurate advice.
Entity-free employment
Feel free to hire employees from all over the world without being weighed down by setting up entities, running complex payroll or recruiting a hiring team.
Payroll without hassle
Have the confidence that your staff will always be paid accurately and on time, so that you can focus on your core business activities and work towards your success.
Always-on support
Access helpful, relevant, personalised advice whenever you need it, along with expert-led recruitment policies and tried-and-tested HR best practices.
"With TopSource we were able to have employees hired or maintained in Nutreco without having to establish an entity in these countries for only 1-2 employees. I think most countries are covered by TopSource, so they can help us with almost all cases. Good advice on conditions and direct contact with employees. Invoicing done directly to the company. An easy process compared to hiring employees by ourselves."
Annette van Duijnhoven
”We searched the market for a local payroll vendor in 2014 and we chose TopSource as our partner. We were looking for error-free and timely payroll processing and TopSource Worldwide delivers this, saving us time and money. We have worked together for 8 years now and would recommend them to anyone."
Praveen Lihinar
Personalised Employer of Record services in Luxembourg
TopSource Worldwide offers personalised Employer of Record (EOR) services tailored to meet the specific needs of your business in Luxembourg. This includes handling employee onboarding, payroll processing, tax compliance, employee benefits management, and HR support. Our EOR services ensure that your business meets all legal and regulatory requirements, providing a hassle-free solution to manage your Luxembourg-based employees.
End-to-end Luxembourg payroll services
Looking to expand into Luxembourg? Our unparalleled expertise in global payroll services ensures that your business can seamlessly navigate the complexities of payroll on a global scale, supporting your Luxembourg expansion initiatives.
Global entity management
Venturing into the Luxembourg market can be both exciting and challenging. With distinct business regulations, cultural nuances, and economic landscapes, it's essential to have a clear roadmap for your business establishment journey.
Accounting
Whether your goal is to process your purchase-to-pay transactions with minimum errors or manage your expense claim procedure, our team of experts can handle your accounting responsibilities, allowing you to focus on your core business and save time and money.
Global EOR services
Managing a diverse global workforce can be complex. This is where TopSource steps in as an invaluable employer of record services partner for companies seeking to expand their global reach while ensuring compliance with local employment laws and regulations.
Global Expansion Simplified
How to do business in Luxembourg
Entering the Luxembourg market presents a mix of excitement and challenges. Given unique business regulations, cultural intricacies, and economic dynamics, a well-defined roadmap is crucial for a successful business establishment.
TopSource Worldwide is with you at every stage. Whether it's navigating local regulations or facilitating seamless operational transitions, our expertise ensures a swift and efficient process for establishing your business in Luxembourg.
Luxembourg Insights
Key insights into Luxembourg's landscape
VAT rates: Luxembourg has a standard VAT rate of 17%, with reduced rates of 14%, 8%, and 3% for specific goods and services.
Ease of Doing Business rank: Luxembourg ranks 52nd in the World Bank's Ease of Doing Business Index, indicating a moderately favourable business environment.
Consumer Confidence Index: As of 2022, Luxembourg's Consumer Confidence Index was 89.3, reflecting stable economic sentiment.
Employee maternity/paternity leave: Maternity leave is 16 weeks, and paternity leave is 2 weeks, emphasising work-life balance and parental support.
Employee termination period: Standard notice for termination varies but is typically 1 to 3 months, depending on employment contract terms and duration.
Employee salary pay date: Wages are generally paid monthly, with specific pay dates outlined in employment contracts and subject to labour laws.
Bank holidays: Luxembourg observes public holidays, including New Year's Day, National Day, and Christmas, with a total of around 10 public holidays in a year.
An Overview of Statutory Benefits on the Luxembourg
Luxembourg’s pension system is built on a number of pillars. The public tier state pension, as well as occupational and personal pensions, are included in the system. These funds are under the management of the Caisse Nationale d’Assurance Pension (CNAP).
Luxembourg’s state pension (Pension de Vieillesse / Altersrente) can be claimed by workers in full or in part. The amount they receive is determined by the number of years they have paid into social security by the time they turn 65. This is the age at which people in Luxembourg can begin receiving their state pensions.
Employees in Luxembourg can self-certify illness for two days, but must then seek a medical note for illnesses that last more than three days. For long term sickness, the employer is responsible for the first 77 days, then the social security system covers sick pay.
Working mothers in Luxembourg are entitled to 20 days of paid maternity leave, and employers may offer to increase the amount of leave available either at full or reduced pay. Fathers are entitled to 10 days of full pay before they return to work, but agreements are often made from organisation to organisation.
Parents have an entitlement of a total of six months to care for children under five years old.
Contractual Provisions in Luxembourg
Employment contracts in Luxembourg can be short-term or long-term, permanent or temporary. Every contract must be in writing, and each party must receive a copy of the agreement.
It is not possible to extend a fixed-term contract beyond two years or to renew it more than twice. Employees must be offered a permanent position or dismissed after this period.
The usual probationary period in Luxembourg is between two and six months. In most cases, it is included in the contract of employment and the employee must have the same contract as their peers after passing probation. However, it can only be extended for a maximum of three additional months, which must be agreed to by both employees and employers.
The maximum number of hours that can be worked in a day is eight, making the normal working week 40 hours.
If necessary, this can be increased to 10 hours a day and 48 hours a week, as long as this is agreed .
The workday can go up to 12 hours a day in specific industries. It would then be limited to a weekly work week of 60 hours.
Employees can only be asked to work overtime in special circumstances, such as if revenue will be lost or there is no one else available to do the work. The employee can still decline overtime if they wish.
An employee is only allowed to work an additional two hours per day and a maximum of ten hours per week. If an employee works more than the required number of hours per week, they are entitled to a 40% uplift to their hourly wage.
During a work week, employees are entitled to a minimum of 44 hours of uninterrupted rest time off, usually over the weekend. An additional one day of leave is granted to employees who have worked overtime of more than eight hours in a working week.
Workers in Luxembourg are entitled to 25 days of annual leave (exclusing bank holidays). Employees with a registered disability are offered an additional six days of annual leave on top of this allowance.
Our author
Mark Robbins
Global Sales Director
Mark is the Sales Director at Topsource Worldwide. He has been a pioneering figure in the global expansion space since 2013. He is the first salesperson to sell EOR services in Europe, a feat he accomplished in 2013.
Published 2023-11-14 00:00:00
Updated 2023-11-15 00:00:00
Reviewed by:
Adrian Cooney
Fact checked by:
Adrian Cooney
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