Unemployment insurance is mandatory for all employees in Luxembourg, all taxpayers contribute to the unemployment insurance programme through an income tax surcharge.
Unemployment benefits are paid only when you become unemployed involuntarily, e.g. if you’re made redundant, and not when you quit your job voluntarily. If you’re sacked, you may still be eligible for unemployment benefit after a certain period. To qualify for benefit, you must be fit and available for work (which usually means you must enrol with the national employment office), and register with your local benefits office on a regular basis.
If you’re an EU citizen and move from Luxembourg to another EU country to seek employment, you may be entitled to up to three months’ unemployment benefit from the country you’ve left. To qualify, you must notify the benefits office of your move and register with the unemployment office in your new country within seven days of your arrival. Further information is available on the EU website (click here ).
In Luxembourg, you’re supposed to register with the local employment authority (i.e. to find work) the day you become unemployed. You must then submit an application for unemployment benefit to the Administration de l’Emploi within two weeks. You must have been employed for at least 26 weeks during the last 12 months. There’s also a benefit available for partial unemployment, i.e. where your working hours are significantly reduced as a result of a company reorganisation or a decrease in production. Benefit starts the day you become unemployed, provided you submit your application within two weeks. If you apply late, benefit is backdated 14 days before your application.
Young people who have completed vocational training are eligible for unemployment benefit at a special rate, according to their age, the school-leaving or technical certificates they’ve received, and the statutory minimum wage applicable.
Normal unemployment benefit is 85 per cent of your gross salary in the three months immediately preceding unemployment if you have dependants, or 80 per cent if you don’t. If your spouse earns more than a certain amount, your benefit is reduced accordingly. The maximum duration for unemployment benefit is 365 days in a 24 month period (to encourage you to find part-time work), but this can be extended by up to 182 days, depending on a number of factors related to your expected chance of finding a job, e.g. your age, profession and family situation. Those over the age of 50 can further extend the benefit period by up to 12 months if they have a certain number of credits toward a pension plan.
This article is an extract from Living and Working in Holland, Belgium & Luxembourg. .