IMPORTANT: The Social Parameters have been updated. Read our PwC Flash to learn about the new applicable social parameters from 1 April 2022.
Nearly one year after the beginning of the COVID-19 pandemic –unheard-of by most of us– followed by an economic crisis, the Luxembourg government has decided to focus on helping the people whose income is more limited and may be living in a disadvantageous situation. Consequently, about 60 000 employees are benefiting from the increase of the social minimum wages by 2.8% as from 1st January 2021.
To face this additional cost, the government is partially compensating companies in the sectors most impacted by the Covid-19, listed in the law. To do so, the provision of a subsidy has been determined.
Like in previous years, you will find hereafter the new social parameters that are applicable from 1st January 2021 as well as the public holidays for this year.
You can access the French version of the article here: Paramètres sociaux 2021 au Luxembourg, quoi de neuf?
What we think
The social minimum wage in Luxembourg is among the highest in Europe. However, despite the rising social expenses due to the Covid-19 since last year, our social security scheme offers good coverage for a moderate and stable cost, for both employees and employers. Luxembourg remains competitive despite a high level of salaries.