With effect from 1 April 2023, the index applicable to employee wages increases from 898.93 to 921.40.
This is the application of the index tranche triggered in June 2022 and deferred to April 2023 in accordance with article 3 of the law of 29 June 20221 implementing certain measures set out in the Tripartite Agreement of 31 March 2022.
This increase in the index results in a mandatory 2.5% increase in the gross salary paid to individuals with employment contracts subject to Luxembourg law.
Wage indexation is an automatic mechanism to adjust salaries in line with evolving living costs, as determined by the STATEC2. Salaries are automatically increased if the consumer price index increases by at least 2.5% in the previous 6 months. The aim of this measure is to compensate employees for loss of purchasing power due to inflation by increasing salaries accordingly.
From 1 April 2023, the gross minimum wage for workers is therefore increased by 2.5% as follows:
1. The law of 29 June 2022 implementing certain measures set out in the "Agreement between the Government, the Union des Entreprises luxembourgeoises and the LCGB and CGFP trade unions" dated 31 March 2022 and amending: 1. the Social Security Code; 2. title 1 of the amended law of 4 December 1967 on income tax; 3. the amended law of 12 September 2003 on people with disabilities; 4. the amended law of 24 July 2014 on State financial aid for higher education; 5. article 3, paragraph 7 of the amended law of 25 March 2015 establishing the salary regime and the conditions and methods of promotion for State civil servants; 6. the amended law of 23 July 2016 amending 1. the Social Security Code; 2. the amended law of 4 December 1967 on income tax and repealing the amended law of 21 December 2007 on the child rebate; 7. the amended law of 28 July 2018 on the social inclusion income.
2. National Institute of Statistics and Economic Studies of the Grand Duchy of Luxembourg.
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