ARTICLE
11 April 2023

Index Increase From 1 April 2023

AM
Arendt & Medernach

Contributor

About Arendt

Arendt combines the entire value chain of services dedicated to Asset Managers, Banks, Insurers, Public Institutions and Private Clients operating in Luxembourg.

-Legal & Tax
-Regulatory & Consulting
-Investor Services

Legal & Tax

We assist clients in structuring and running their business from a legal and tax standpoint across Luxembourg. Our teams directly serve international clients or work in close collaboration with foreign partner law firms.

Together with our regulatory consultants and investor services experts, we bridge the gap between legal/tax advice and its implementation. We deliver best-in-class services along our clients’ business life cycles.

The 450 legal experts of Arendt & Medernach have a wealth of experience in a wide variety of specialisations. Together, they are able to advise on a complete range of 15 complementary practice areas

With effect from 1 April 2023, the index applicable to employee wages increases from 898.93 to 921.40.
Luxembourg Employment and HR

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:

1303084a.jpg

Footnotes

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.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More