Prime Minister Xavier Bettel detailed the government’s social actions during his speech on the State of Nation on April 2. Since the temporary variation of the index introduced by the previous government is expiring, the sea serpent of the wage index reform is coming back. Another old case: the bill aiming to rationalize employee representation structures is also back. Finally, another project on age management in businesses was adopted.
Wage indexation. Together with Belgium, Luxembourg is the last European country that still has a system for indexing wages and salaries to the evolution of the cost of living. In 2012, the social partners failed to agree on a reform for this system – which has been the object of recurring pressure from the European institutions that want it removed – led the government to impose a fixed 2.5 annual increase, effective in October. This temporary solution ends in October and, in theory, wages should once again make up for inflation, which is above 2.5 percent.
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