The collective labour agreement is an agreement applicable to a specific company or a group of companies, concluded between representatives of both the employers and the employees.
The collective agreement supplements the regulations of the labour laws according to the needs and specific nature of each sector of activity, notably with regard to the organisation (factories requiring 24/7 operation, fixed-hour office work, workers in the leisure business working on non-working days, etc.) and working constraints (night work, etc.).
It also establishes employment and working conditions and provides social guarantees not only for workers but also for employers.
The provisions of a collective agreement must be respected by companies:
- which have negotiated a collective agreement;
- which are part of a sector of activity subject to a sectoral collective agreement or a mandatory collective agreement;
- which are part of a group of companies or an economic and social entity subject to a collective agreement when the production, activity or profession are in a similar field.
It namely concerns businesses which:
- have a common structure or infrastructure;
- use a common or coordinated strategy;
- have common or associated management and/or shareholders;
- have a group of employees that are linked by common interests.
Occasional and temporary service providers who send staff to Luxembourg are not required to respect collective agreements.
Scope of collective agreements
The collective labour agreement applies in a standard manner to staff in a business or a group of businesses, whatever their roles or activities.
Only the collective agreement which corresponds to the main field of activity of the employer is applicable, even if the employer carries out several different activities.
The employer must state in the employee's employment contract whether he falls under the collective agreement or not. This information must be stated in the employment contract. For example, the employment contract may contain the following sentence:
'This employment contract is governed by the labour laws and the provisions of the collective agreement applicable to the business (see appendix)'.
Exclusion of senior management
Unless stipulated otherwise in the collective agreement, senior management is not concerned by the working and salary conditions established in the collective agreement which applies to the staff.
The following are considered to be senior management :
- employees whose salary is significantly higher than the salaries paid to the staff covered by the collective agreement and;
- where the salary forms the counterpart in exchange for a true and effective power of management and;
employees who benefit from:
- independence in the organisation of their work and;
- a large flexibility in their working hours.
A special collective agreement can be drawn up in order to define the conditions of work and salary for senior management.
Distinctive blue-collar/employee agreements - temporary provisions
Before the adoption of the single statute (statut unique) for employees in 2008, collective agreements were negotiated separately for blue-collar workers and employees. The principle of unity of collective agreements is henceforth applicable for new collective agreements.
Nevertheless, the temporary provisions mean that the distinction between 'blue collar worker' and 'employee' can be provisionally maintained, within the framework of collective agreements in force until 31 December 2013.
These temporary provisions avoid staff not currently covered by a collective agreement from automatically falling under a collective agreement initially applicable to the other category of staff. Therefore, a collective agreement applicable to one category of staff is not automatically applied to another category.
The collective agreement must clearly state which staff is covered by its scope of application and those who are excluded.
As from 1 January 2014, it will no longer be possible to differentiate blue collar workers from employees in the collective agreements. Only one single collective agreement will apply to the totality of the personnel.
The collective agreement may contain particular rules for the positions which entail a large portion of management and support activities which are not directly linked to the execution of the business' main activity.
These rules may namely affect:
- recruitment and dismissal conditions;
- the duration of work;
- public holidays and leave;
- the remuneration;
- night work and hard labour.