A bill transposing Directive 2018/957/EU and amending the Labour Code, was introduced in the Chamber of Deputies in Luxembourg.
We will make only a few remarks in the margin of the draft legislation.
1 Pursuant to Article L 010-1 Labour Code , the concept of remuneration covers the social minimum legal remuneration, or determined by a collective bargaining agreement declared generally applicable, all the constitutive elements laid down by Article L 221-1 Labour Code, and the indexation to the cost of living.
There are two different levels of social minimum legal remuneration, the highest is applicable to employees justifying professional qualifications in the sense of Article L-222-4 Labour Code. Furthermore, pursuant to Article L-141-1 (7), only constitutive elements made compulsory by law, regulations or administrative provisions, and those arising from collective bargaining agreements declared generally applicable, are deemed to constitute components of the social minimum remuneration.
The following questions might be frequently asked:
- how to figure out “permitted components” (eventually by “listing out” all the constitutive elements above referred to?)
- as an ancillary issue, how difficult will be to bring proof that an employee qualifies for the lowest level (although such cases should be rare)
There are two categories of collective bargaining agreements: declared generally applicable and “standard”. Standard CBA are negotiated between an employer or a group of undertakings, and a trade union. Standard CBA can be of relevance (by virtue of Art L 010-1 Labour Code), or not, by virtue of the CBA concerned (e.g. the CBA N° 1054 declared generally applicable for the banking sector, it is applicable exclusively to employees carrying out a permanent activity in Luxembourg-see Article 2).
Article L 221-1 contains a non-exhaustive list of components: remuneration paid in compensation for the work carried out, and any additional benefit paid as a consequence of the work carried out.
Pursuant to Article L 141-1, the indexation to the cost of living applies only as regards the social minimum legal remuneration, or the minimum applicable by virtue of CBA declared generally applicable.
2 The replacement condition (Article L 141-2), does not bring more clarity then the provision laid down by Directive 2018/957/EU.
The 12 months period represents neither a continuous period of 12 months, and nor 12 months within a certain reference period.
Prima facie about the cumulative duration of different (eventually discontinued) posting periods, during which one or several posted workers, sent by the same undertaking, carry out the same task at the same place of work, calculated from the beginning of the first posting period.
3 Article L 141-1 is amended to better define the temporary nature of the posting
Regardless the transnational measure taken (in the sense of Article 1 Directive 96/71/EC as amended), the posting shall take place in the framework of a contract of provision of services. The contract must contain reference to a scope or specific activity limited in time, and shall terminate upon completion of the scope of services.
The amendment is not only a matter of “nuance”. The scope/activity must be clearly addressed, ascertainable in time (not only addressed in relation to a timeframe), and completion of the scope of services shall give rise to termination of the posting period. Reading in conjunction that provision, with the new last paragraph of Article L 141-1, a significant number of “postings” can be requalified as local employment (under labour law).
4 Beyond Article 1.3 (c) Directive 96/71/EC, as amended by Article 1 (1) (c) Directive 2018/957/EU, pursuant to ECJ case law, Article L-141-1 (2) contains reference to undertakings which without being temporary employment undertakings or placement agencies, lawfully hire out workers to a user undertaking.