Short-time working “in the event of force majeure / coronavirus.”
To protect jobs and thus prevent redundancies, the Luxembourg Labour Code allows businesses to resort to various types of short-time work under certain conditions and depending on the nature of the difficulties encountered.
Considering the current context, employers can make use of short-time work due to an event of force majeure.
Given the significant threat of COVID-19 the Government decided to put in place an option for an accelerated procedure – short-time work “ in the event of force majeure / coronavirus” for businesses.
Businesses that had to cease all or part of their activities following the government decision referred to by the ministerial decree of 16 March 2020 and the grand-ducal regulation of 18 March 2020.
Businesses experiencing a drop in activity as a result of the COVID-19.
Formalities until 27 March 2020
- All short-time work application forms up to 27 March 2020 were to be transmitted via a specific form :
Formalities after 27 March 2020
- The short-time work application form has to be submitted each month using secure authentication (Luxtrust product) via MyGuichet.lu : http://guichet.lu/cocp
- Applications from companies that can no longer carry out their activities following the government decisions will be processed directly by ADEM. Applications from other companies will only be processed after the agreement of the Economic Committee (Comité de conjoncture).
- In both cases ADEM will pay an advance to the companies corresponding to 80% of the salaries of the staff affected by short-time working.
Our Payroll teams remain at your disposal to assist you. In order to assist you please send us the following documents and information as soon as possible :
- Supporting document signed by a legal representative of the requesting company (see below)
- The company’s IBAN account and mandatory a bank identity statement in PDF or JPG
- The number of employees concerned by the short-time working for each month
Employees with a permanent or fixed-term employment contract employed by a company legally established in Luxembourg at the time of the short-time work, fit for work, under the age of 68, who do not receive an old-age pension, an early old-age pension or a disability pension, who are normally employed in Luxembourg and who are affiliated as an employee to Luxembourg social security are eligible. Temporary workers are excluded.
Apprentices in initial and adult learning, are eligible.
In case you submit a request for short-time work, please keep us informed and send us an Excel file with:
Id of employees/name of employees, period and hours of unemployment
Based on this information, we will calculate/adjust the salaries for March, April and possibly subsequent months.
- Employees must take their untaken holidays prior to 2020 before being eligible for short-time working
- the employee who is on short-time working is not entitled to family leave. The same applies to an employee whose partner or spouse is on short-time working.
During the short-time working period, the employer has to pay to its employees, the salary due for every worked hour, as well as a compensatory allowance in respect of inactive hours.
The rate of the statutory compensation allowance is set at 80% of the employee's normal gross hourly wage, without being lower than the social minimum hourly rate for unskilled employees or exceed the amount of 250% of the social minimum hourly wage payable to an unskilled employee over the age of eighteen (currently EUR 5,354.98 on a monthly basis at index 834.76).
Advance on reimbursement
Businesses whose application is approved will receive advances based on the expected number of employees unable to carry out their normal activities. These advances enable companies to obtain the cash needed to pay the salaries of their employees.
The advance is equivalent to 80 % of the wage costs for employees on short-time working.
After the end of the month, the company must draw up a detailed reimbursement statement showing the actual inactive work hours and the amounts actually owed by the government. In the event that the advance was higher than the amount actually owed by the government, the company will have to reimburse the amounts overpaid.
During the period of short-time working, the government shall pay compensation up to 80 % of the salaries. Reimbursement is limited to 250 % of the social minimum wage for unskilled employees aged 18 or over (€ 5.354,98 indice 834,76). This compensation may not be less than the amount of the social minimum wage for unskilled employees.
The form for the detailed reimbursement statement is in development.
Our Payroll teams remain at your disposal to assist you in due time.
Useful links :
We remain at your disposal for any questions.
With best regards,
Your BDO Payroll Team
Here you will find the supporting document to be signed by a legal representative of the requesting company.
For the French text version please click here.