The law of 7 August 2023 amending i) the Labour Code, ii) the law of 29 August 2008 on the free movement of persons and immigration (the "Immigration Law") and iii) the law of 18 December 2015 on the reception of applicants for international protection and temporary protection has been published in the Luxembourg Official Gazette on 28 August 2023 (the “Law”).
The Law will enter into force on 1 September 2023.
The Labour Code already prohibits the employment of illegally staying third-country nationals, i.e. the employment of any person:
- who is not a citizen of the European Union (“EU”) or who does not enjoy the right of free movement within the EU,
- who operates in the Grand Duchy of Luxembourg, and
- who does not meet or no longer meets the residence conditions laid down in the Immigration Law.
This includes, for example, third-country nationals staying in Luxembourg for more than three months but who do not have a residence permit.
In this context, the Law :
- prohibits, in addition to the employment of illegally staying third-country nationals, the employment of third-country nationals in an irregular situation;
- increases the penalties for employers, with the aim of further dissuading employers from employing third-country nationals who are illegally resident or in an irregular situation.
The Law also amends the Immigration Law, with the aim of making Luxembourg more attractive to workers from third countries. Finally, the Law simplifies the vacancy declaration process that employers must submit to the Employment Development Agency ("ADEM"), before hiring a third-country national in Luxembourg, again with the aim of facilitating the recruitment of foreign nationals in Luxembourg.
New ban on the employment of third-country nationals in an irregular situation
A third-country national in an irregular situation is defined by the Law as one who is working on the territory of the Grand Duchy of Luxembourg but does not meet, or no longer meets, the conditions inherent in the work permit.
Third-country nationals in an irregular situation are therefore those who are legally resident but do not have a work permit.
The Immigration Law already requires that a third-country national willing to enter the Luxembourg territory for up to three months, and work as an employee or self-employed person, must hold a work permit (unless he/she falls under one of the exemption listed by the Immigration Law). The Law now also requires a work permit for all third-country nationals wishing to stay and work in Luxembourg as an employee for more than three months.
As in the case of the employment of illegally staying third country nationals, the Law now requires employers to hold a copy of the employee’s work permit throughout the entire period of employment.
Increased penalties for employers who employ illegally staying third-country nationals or third-country nationals in an irregular situation
The Labour Code initially provided for an administrative fine of EUR 2,500 per third-country national for any employer who employed one or more illegally staying third-country nationals.
The Labour Code also provided for imprisonment of between eight days and one year and/or a fine of between EUR 2,501 and EUR 20,000 per illegally staying third-country national, if the employment of such an individual takes place in at least one of the circumstances listed in the Labour Code (and detailed below).
As part of a deterrent strategy, the Law raises the threshold for administrative fines from EUR 2,500 to EUR 10,000 per third-country national. The criminal fine increases from a maximum of EUR 20,000 to a maximum of EUR 125,000 per third-country national, if at least one of the following circumstances is met:
- the offence is persistently repeated;
- the offence relates to the simultaneous employment of at least two illegally staying third-country nationals or at least two third country nationals in an irregular situation;
- the infringement is accompanied by particularly abusive working conditions;
- the offence is committed by an employer who uses the work or services of an illegally staying third country national or of a third country national in an irregular situation in the knowledge that this person is a victim of human trafficking;
- the offence relates to the illegal employment of a minor.
All the increased penalties detailed above apply both to the employment of illegally staying third-country nationals and to the employment of third-country nationals in an irregular situation.
It should be noted that, as is already the case for the employment of illegally-staying third-country nationals, the Law introduces a presumption that the illegal employment has lasted at least three months. Proof of the contrary can only be made in writing.
Other measures to widen access to the labour market
The Law introduces a number of amendments to the Immigration Law with the aim of making Luxembourg more attractive to workers from third countries, and therefore more competitive.
Firstly, the Law adds an additional exemption from the requirement for a work permit for third-country nationals wishing to stay in Luxembourg for a maximum of 90 days over a period of 180 days.
The exemption previously applied (in particular) to people wishing to stay in Luxembourg to provide services within the same group of companies.
The Law extends this exemption to persons intending to stay in the national territory to provide services on behalf of a company not belonging to the same group. This additional exemption is necessary insofar as this type of activity reflects a reality in many sectors of the Luxembourg economy.
The Law further enables family members of third-country nationals holding a Luxembourg residence permit to benefit from free access to the labour market, solely on the basis of the "family member" residence permit issued. Family members are hence no longer obliged to apply for a work permit in addition to their residence permit.
Finally, it should be noted that the Law stipulates that the “ETIAS” travel authorisation (European Travel Information and Authorisation System) is now a compulsory precondition for entry into Luxembourg territory for third-country nationals exempt from visas for stays not exceeding 90 days over a period of 180 days. This obligation to hold an "ETIAS" travel authorisation will also extend to family members who are third-country nationals of an EU citizen wishing to enter and stay in Luxembourg for a period of up to three months, unless they hold a valid residence permit.
The "ETIAS" travel authorisation will make it possible to assess whether the presence of the third-country national concerned on Luxembourg territory is likely to present a security or illegal immigration risk, or a high epidemic risk.
Simplification of the vacancy declaration process
To date, the Labour Code requires any job vacancy on Luxembourg territory to be declared to the ADEM, in the interests of maintaining full employment on national territory.
This principle remains unchanged under the Law.
The Labour Code also stated that if, within three weeks of the vacancy being declared, the ADEM has not proposed a candidate to the employer who meets the profile required for the declared position, the employer may request a certificate certifying that it has the right to recruit the person of its choice, including a third-country national. The certificate will be issued within five working days.
On this point, the Law implements substantial changes, whereas the current system forces employers to wait almost a month before obtaining a decision from the ADEM and being able to hire the candidate of their choice.
On the basis of the Law, it will now be possible for any employer legally established in Luxembourg and authorised to carry out the activity relating to the vacant position to apply for a certificate authorising them to recruit the person of their choice immediately after declaring the vacant position. This request for a certificate must be made, under penalty of forfeiture, before the expiry date of the job offer as indicated in the vacancy declaration.
From there, several hypotheses can be envisaged:
- if the vacant position appears on the list of professions declared by the ADEM to be in serious shortage, the ADEM will issue the certificate within five working days;
- if the ADEM ascertains, over an initial maximum period of seven working days following the issue of the acknowledgement of receipt of the certificate request, that there are jobseekers registered with the ADEM, available and corresponding to the profile sought, the ADEM has 15 days to submit these profiles to the employer:
- if the profile is rejected by the employer, the latter must provide the ADEM, within one month, with a detailed explanation of the reasons for the rejection, based on an analysis of the candidate's profile in relation to the job description. Failing this, the certificate application will be rejected;
- if, following the employer's refusal and provided that the latter duly motivated his decision to reject the profile as detailed above, the ADEM considers that the rejection of the profile is justified, the certificate will be issued within ten working days. If the ADEM considers that the rejection of the profile by the employer is not justified, the certificate application will be rejected within ten working days;
- if, over the initial maximum period of seven working days, the ADEM concludes that no registered applicant corresponds to the profile sought, the ADEM issues the certificate within five working days.
At any time, the ADEM may also reject the certificate application if it considers that the vacancy declaration is unreasonable in the sense that it includes a selection of criterion that is not essential for the performance of the tasks referred to in the vacancy declaration.