Luxembourg Statutory and Private Employee Benefits, 2023 Update

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Luxembourg Statutory and Private Employee Benefits Report Overview

Luxembourg has a comprehensive social security system. It is based on principles of solidarity that guarantee generous pension benefits and widespread access to extensive health and long-term care services. A uniform social security status was introduced for all private-sector employees in 2009, which led to structural changes in the social security system, the establishment of equal rights for all employees, and the harmonization of contributions and benefits under the social security system.

The flexible pension system, which rewards deferred retirement, motivates employees to work longer, while the well-developed care systems and labor market policies encourage the recruitment of older workers. The increase in the aging workforce is a major concern for the country, as it may adversely affect the sustainability of the welfare system and the maintenance of the pension system. Therefore, continuous, and sustainable economic and employment growth is necessary for the viable development of the social security system.

The Luxembourg employee benefits market research report provides in-depth industry analysis, information, and insights into employee benefits in Luxembourg, including an overview of the state and compulsory benefits in Luxembourg, detailed information about the private benefits in Luxembourg, insights on various central institutions responsible for the administration of the different branches of social security and the regulatory framework of the employee benefits in Luxembourg.

Key Regulations Social Security Code 2020, Labor Code for paternity leave, and Regulation (EC) No. 883/2004
Key State and Compulsory Benefits Retirement Benefits, Death in Service, Long-Term Disability Benefits, Short-Term Sickness Benefits, Medical Benefits, Workers’ Compensation Insurance, Maternity and Paternity Benefits, and Other Benefits
Key Private Benefits Retirement Benefits, Death Benefits, Medical Benefits, Disability Benefits, Accidental Death and Dismemberment Benefits, and Other Benefits

Regulations Guiding Employee Benefits Market in Luxembourg

Some of the key regulations guiding the employee benefits market in Luxembourg are Social Security Code 2020, Labor Code for paternity leave, and Regulation (EC) No. 883/2004.

Luxembourg Employee Benefits Market Segmentation by State and Compulsory Benefits

The key state and compulsory benefits offered by employers in Luxembourg are retirement benefits, death in service, long-term disability benefits, short-term sickness benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.

Workers’ Compensation Insurance: Workmen’s compensation insurance is a compulsory social insurance scheme funded through contributions made by employers and the self-employed, covering both employees and self-employed individuals. It provides benefits in kind and cash depending on the degree of incapacity and the loss of earnings. It covers accidents at the workplace as well as accidents resulting from traveling to or from work. Accident Insurance Association (AAA) is responsible for compensation for work accidents, commuting accidents, and occupational diseases.

Short-Term Sickness Benefits: Short-term sickness benefit is a compulsory social insurance scheme funded through contributions made by employers and employees. It covers both employees and self-employed by providing income-related benefits. The employer continues to pay the employee’s salary until the 77th day of their incapacity to work under 18 months of the reference period.

Luxembourg Employee Benefits Market Segmentation by Private Benefits

The key private benefits offered by the employers of Luxembourg are retirement benefits, death benefits, medical benefits, disability benefits, accidental death and dismemberment benefits, and other benefits.

Death Benefits: Employers provide death benefits under group life insurance schemes. The scheme provides the flexibility of choosing the duration of coverage and the duration of pension payment. In case of the death of the insured, the survivors are entitled to a lump sum payout. The lump sum can be a multiple of the insured’s salary.

Disability Benefits: Employers in Luxembourg provide disability benefits to employees directly through income protection policies. The disability may be the result of only an illness at work or an accident at work or an illness or accident in private life. Group accident and group life insurance policies also provide long-term disability benefits. Employers can extend the coverage to employees’ spouses/cohabiting partners by making employees contribute the additional premium amount.

For more insights on the Luxembourg employee benefits market, download a free report sample

Scope

This report provides a detailed analysis of employee benefits in Luxembourg –

  • It offers a detailed analysis of the key government-sponsored employee benefits, along with private benefits.
  • It covers an exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen’s compensation insurance, maternity and paternity benefits, family benefits, unemployment benefits, Long-term care benefits, leaves and holidays, and private benefits.
  • It highlights the economic and regulatory situations relating to employee benefits in Luxembourg.

Key Highlights

  • General Inspectorate for Social Security (l’Inspection Générale de la Sécurité Sociale – IGSS under the authority of Ministry of Social Security (Ministère de la sécurité sociale) are responsible for the functioning of the overall social security system.
  • A person’s national insurance contribution is determined based on their income.
  • An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to a credited contribution.
  • In Luxembourg, employers provide voluntary retirement benefits to their employees through group insurance schemes in the form of ASSEPS, ASBLs, and SEPCAVs, ASSEPS, also known as Pension Savings Associations.

Reasons to Buy

  • Make strategic decisions using in-depth information related to employee benefits in the country.
  • Assess employee benefits of the market, including state and compulsory benefits and private benefits.
  • Gain insights into the key employee benefit schemes offered by private employers in the country.
  • Gain insights into key organizations governing the employee benefits market, and their impact on companies.

Table of Contents

  • 1. Executive Summary
  • 2. Introduction
  • 2.1 What is this Report about?
  • 2.2 Definitions
  • 3. Country Statistics
  • 4. Overview of Employee Benefits in Luxembourg
  • 5. Regulations
  • 6. State and Compulsory Benefits
  • 6.1 Retirement Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.2 Death in Service
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.3 Long-Term Disability Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.4 Short-Term Sickness Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.5 Medical Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.6 Workers’ Compensation Insurance
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.7 Maternity and Paternity Benefits
  • – Introduction
  • – Eligibility
  • – Benefits
  • – Payment options
  • – Contribution

  • 6.8 Other Benefits
  • – Family benefits
  • – Long-term care benefits
  • – Minimum resource benefits
  • – Unemployment benefits
  • – Leave and holidays

  • 7. Private Benefits
  • 7.1 Retirement Benefits
  • 7.2 Death Benefits
  • 7.3 Disability Benefits
  • 7.4 Medical Benefits
  • 7.5 Accidental Death and Dismemberment Benefits
  • 7.6 Other Benefits
  • 8. About GlobalData
  • 9. Contact Us

Table

Table 1: Luxembourg – Social Minimum Wage, February 2023

Table 2: Insurance Industry Definitions

Table 3: Luxembourg – Country Statistics, 2022

Table 4: Luxembourg – Social Minimum Wage 2023

Table 5: Luxembourg – Contribution by Employer and Employee

Table 6: Luxembourg – Reversion factors for the various pension Components

Table 7: Luxembourg – Monthly amount for an unemployed couple

Table 8: Luxembourg – Amount of cost-of-living benefit 2023

Table 9: Luxembourg – Eligibility of Benefits for Young Unemployed

Table 10: Luxembourg – Public Holidays 2023

Figures

List of Figures

Figure 1: Luxembourg – Main Institutions of Social Security System

Frequently asked questions

Luxembourg Statutory and Private Employee Benefits, 2023 Update standard reports
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