What is the single statute?
Until recently, those working in Luxembourg’s private sector were divided into two categories or statutes: “blue-collar” workers and “white-collar” private employees. Essentially, this meant that blue-collar and white-collar employees were represented by different employee chambers, and had different health insurance and pension funds. On the 1st of January 2009, these separate statutes officially merged into a single statute for all employees of the private sector.
The idea to introduce a single statute in Luxembourg came out of the 2006 Tripartite negotiations between the government, employers’ representations and trade unions. The corresponding law was adopted by Parliament on 29 April 2008, and was officially published in Memorial A as the Law of 13 May on the introduction of a single statute. By effectively eliminating the definitions “blue collar” and “white collar”, the introduction of the single statute has had far-reaching implications on social security and labour law.
Why a single statute?
The original distinction between the statutes of blue-collar and white-collar workers can be traced back to the heyday of the steel industry. However, it was widely believed that such a disparity of statutes ran counter to Article 10bis of the Constitution, which established the principle of equality of all Luxembourg nationals before the law. It also meant that until the introduction of the single statute, European legislation often had to be transposed twice according to the different statutes.
The ABBL and the single statute
Although banks rarely hire blue-collar workers, many of the changes introduced by the single statute, such as the generalised adoption of the principle of continued salary payment or the creation of a mutual scheme for companies, also affects the financial sector. As the official spokesperson of banks and other financial sector professionals, the ABBL represented financial sector employers in all Tripartite negotiations on the single statute, as well as in social security institutions.
The major changes introduced by the single statute
- Generalised adoption of the principle of continued salary payment for 13 weeks; In order to extenuate the risk that this continuation of salary payment during the first thirteen weeks poses, an Employers’ mutual insurance was created. This naturally implies a significant transfer of the financial burden.
- Introduction of a single contribution rate for benefits in kind at 0.5% (0.25% employer; 0.25% employee).
- Compulsory membership to the Employers’ mutual insurance for companies during the period of continued salary payment.
- A new system for the declaration of salaries to the Joint Social Security Centre (Centre Commun de la Sécurité Sociale) and introduction of a new basis for the assessment of contributions.
- Merger of the different health insurance schemes into a single National Health Fund and of the pension schemes into a single National Pension Fund.