Any employer wishing to recruit an employee must conclude an employment contract either before or on the first day of employment.
The employment contract is an agreement that governs a work relationship through which one person undertakes to work for another in return for remuneration.
An employer recruiting a new employee in response to a lasting need for personnel as part of the normal and permanent activity of the business must usually resort to a permanent employment contract (contrat à durée indéterminée - CDI).
The employer can only use fixed-term contracts (contrat à durée déterminée - CDD) in exceptional cases as a response to isolated needs of the business.
The set of rules applying to any employment contract, namely with regard to the form and the mandatory information also apply to fixed-term employment contracts.
The fixed-term contract must also satisfy certain additional obligations in terms of:
- motives justifying the use of a fixed-term contract;
- its content in terms of:
- mandatory information;
- trial period;
- end date of the contract.
Carry out your procedure:
By downloading a form
- Contrat à durée déterminée - modèle de la Chambre des Métiers
- Contrat à durée déterminée - modèle de l'ITM
The following are concerned when drawing up a fixed-term employment contract:
the employer who wishes to recruit an employee for a limited period of time to execute a specific task limited in time;
- the employee who wishes to work under the employer in return for remuneration.
Furthermore, before recruiting an employee and drawing up an employment contract, employers must first submit a declaration of vacant position to the Employment Administration (Agence pour le développement de l'emploi - ADEM).
This declaration will enable ADEM to check whether there are any jobseekers who have employment priority.
Cases for fixed-term employment contracts
A fixed-term employment contract may only be concluded for a specific and temporary task.
It can only be concluded in exceptional circumstances in response to labour needs which do not encompass the normal and permanent activity of the business.
A fixed-term employment contract concluded for the purpose of running a permanent activity of the business may be reclassified as a permanent employment contract.
Fixed-term employment contracts can be used on a general basis in certain specific sectors of activity where such contracts are unavoidable due to the nature of the activity or the temporary nature of the work.
Examples of specific and temporary tasks
The following are considered to be specific and temporary tasks:
- replacing an employee who is temporarily absent or filling a temporarily vacant position;
- seasonal employment;
- occasional and one-off tasks which are not covered by the regular activity of the business;
- specific and temporary work carried out in the case of a temporary and exceptional increase in business activity or in the case of business startups or expansion;
- urgent and necessary works to prevent a negative impact on the business;
- jobs assigned to jobseekers in the framework of integration and return to work measures;
- jobs destined to provide employment for certain types of jobseekers;
- jobs for which the employer is committed to offering additional professional training to the employee;
- contracts concluded with workers in the entertainment industry without regular and permanent employment;
- contracts concluded between an employer and a student/pupil.
Sectors of activity where a temporary employment contract is appropriate
In addition to specific and temporary tasks, the temporary contract can also be used in the following sectors and professions:
- audiovisual sector:
- radio and television broadcasters-anchors;
- radio and television editors-programmers;
- radio and television presenters;
- producers, directors, floor managers;
- radio and television reporters-cameramen;
- audiovisual, cinematographic and phonographic production industry:
- writers, composers, performers, actors and extras;
- directors, producers;
- script editors, production assistants;
- cameramen, reporters-photographers;
- decorators, make-up artists, dressers, floor managers, film editors;
- sound, lighting and vision operators;
- banking sector:
- private banking specialists;
- investment advisors and portfolio managers;
- experts responsible for swaps, options, futures and forward rate agreements;
- experts responsible for mergers and acquisitions, venture capital and risk capital;
- vocational training and teaching sector:
- supply teachers, executive assistants and socio-educational jobs, if the jobs cannot be filled by personnel fulfilling the necessary conditions required for admission to the mandatory training course or nomination;
- sports professionals:
- trainers for sportsmen/sportswomen;
- construction and public works:
- workers recruited for building sites abroad;
- cooperation, technical assistance, engineering and research activities;
- personnel hired for exhibitions, fairs, shows, congresses or seminars;
- fairground personnel;
- forestry workers;
- persons conducting surveys on a temporary basis;
- conductors and soloists in orchestras, instrumental or vocal groups;
- performing artists;
A fixed-term contract may also be offered to employees with an authorisation to stay when they start their first job with an employer in the sector of:
- construction and public works;
- hotel and catering industry;
- agriculture, horticulture and viticulture.
Form of an employment contract
The employment contract must be drawn up:
at the latest when the employee enters into service and;
in two copies - one of which is kept by the employer and the other one is given to the employee.
If it is not stated in writing that the contract is established for a fixed-term period, it will be assumed that it is a permanent contract and the employer will not have the right to claim otherwise.
Mandatory information in all employment contracts
Employment contracts must include the following mandatory information:
the identity of the parties concluding the contract (names, addresses).
NB: in the event of a change of address, the employee must notify his employer;
the effective date of entry into service of the employee. As regards the employment of non-EU nationals, the date of entry into service may be stated on a conditional basis, for example:
'the employee will enter into the employer's service on the date of receipt of his work permit and, in any case, at the earliest on dd/mm/yyyy', or;
'the validity of this contract is subject to the employee obtaining his work permit within 6 months from the contract date';
the place of work: if the employee has to work in various locations and/or abroad, as opposed to a fixed or principal location, this must be expressly stated in the employment contract;
the registered office of the business or, where applicable, the residence of the employer;
the nature of the job carried out, and, where applicable, a description of the role and tasks assigned to the employee at the time of his employment. The employer can also state that the employee may be assigned to other tasks;
the duration of the employee's usual daily or weekly work;
the usual working schedule;
the basic salary and the index in force on signing the contract, as well as any additional financial benefits (incentives, 13th month, head-of-household premium, bonus, etc.). The value of remuneration in kind (e.g. meals, housing) has to be indicated precisely for it to be deducted from the salary;
the duration of paid annual leave, or if it is not possible to state this when concluding the contract, the means used to determine and allocate the amount of leave must be stated;
the notice period that the employer and employee must give if the contract is terminated;
the duration of the trial period, where applicable;
where applicable, a reference to the collective agreements governing the working conditions of the employee;
where applicable, the existence and the description of a supplementary pension scheme, the optional or compulsory nature of this scheme, the rights to related benefits as well as the existence of any personal contributions;
where applicable, any additional or derogation clause which may override the law. These clauses must be favourable to the employee. If this is not the case, they are declared null and void.
Specific mandatory information in fixed-term employment contracts
Apart from the mandatory information in any employment contract, a fixed-term employment contract must include:
- the reason for which the contract was established;
- the end date of the contract;
- if it is a replacement contract, the name of the absent employee.
- a renewal clause, if applicable.
The maximum duration of a fixed-term contract is 24 months, including renewals.
If the maximum duration of the contract is not respected, the contract is considered as a permanent employment contract (CDI).
The trial period must be taken into account when calculating the maximum duration of the contract.
- the duration of a seasonal employment contract cannot exceed 10 months including renewals, over a period of 12 months;
- the duration of a fixed-term contract concluded between a public research centre and a researcher cannot exceed 60 months, including renewals.
In principle, a fixed-term contract must include an exact end date. However, it may include a conditional expiry date:
- if it is established in order to replace:
- an employee who is temporarily absent;
- an employee whose employment contract has been suspended for a reason other than a strike;
- an employee on a permanent employment contract whose position has become vacant, while awaiting the entry into service of the employee hired to replace him.
- if it concerns seasonal employment;
- if it concerns a job for which it is not common practice to use a permanent employment contract due to the nature of the activity carried out or due to the temporary nature of this job.
In these different cases, the contract must be established for a minimum period and must end when the absent employee returns or when the objective of the contract has been fulfilled.
If the conditions related to the term of the contract are not respected, the contract is considered as a permanent employment contract.
Replacement for parental leave: the fixed-term employment contract of an employee hired to replace an employee on parental leave:
- may start, at the earliest, 3 months prior to the beginning of parental leave and must end, at the latest, 3 months after the end of the parental leave of the employee being replaced;
- may start, at the earliest, 3 months prior to the beginning of maternity leave and must end, at the latest, 3 months after the end of the parental leave where the employee being replaced benefits from parental leave after at the end of her maternity leave.
It is possible to include a trial period in any employment contract, i.e. a probation period that begins at the start of the employment contract.
The trial period is meant to:
give the employee the opportunity to ensure the job is suitable for him;
give the employer the opportunity to assess the competences of the salaried worker.
During this period, the 2 parties may rapidly terminate the employment contract.
The trial period must be stipulated in writing, at the latest when the employee starts work.
If the contract is concluded orally or following a fixed-term employment contract, it cannot include a trial period.
If the business has a collective agreement in place with a provision stating that the employment contract of each new worker begins with a trial period, it is not necessary to include a trial period clause in each individual contract.
Duration of the trial period
The minimum duration of the trial period is 2 weeks.
The maximum duration of the trial period depends on the employee's level of qualification and salary. It is set at:
3 months maximum if the employee does not have a vocational skills certificate (CATP) / vocational diploma (DAP) or equivalent (national diplomas awarded after the successful completion of initial vocational training or an apprenticeship);
6 months maximum if the employee has a vocational skills certificate (CATP) / vocational diploma (DAP) or equivalent, or a higher level of training;
12 months maximum if the employee receives at least a gross monthly salary of EUR 536 at index 100 (i.e. EUR 4,154.91 as from 1 January 2016).
If the trial period stated in the contract exceeds these maximum limits, the trial period clause is deemed null and void for the excess period.
Example: the employer concludes a permanent employment contract with an employee and includes an 8-month trial period. The hired employee has a level of qualification higher than a vocational skills certificate and his gross monthly salary is EUR 3,100.
Therefore, the hired employee can only be subject to a trial period of 6 months. The other 2 months stated in the contract are considered a surplus and are therefore not applicable.
If the trial period does not exceed one month, it must be stated in weeks. In other cases, it must be stated in whole months.
In the context of the same working relationship, only one trial period may be implemented. The trial period cannot be renewed for the same position or any similar position and not within the framework of the employee's promotion to a new position.
Specificities of the trial period in fixed-term employment contracts
The trial period in a fixed-term contract may not run from the beginning to the end of the employment contract.
In practice, a trial period which would be too long compared to the total duration of the fixed-term employment contract may be declared null and void.
For example: a fixed-term employment contract concluded with a skilled worker may in principle not include a trial period of more than 5 months.
When the contract does not have an expiry date, the trial period is calculated according to the minimum contract duration.
Suspending the trial period
Should the contract be suspended during the trial period (due to illness, annual leave, leave for family reasons, etc.), the trial period is suspended throughout the whole period of absence.
When the employee returns to work, the trial period is automatically extended for a period equal to the period of suspension. However, the maximum period of extension is 1 month.
Example: an employee is hired on 1 January and his employment contract states a trial period of 3 months. The trial period should therefore end on 31 March.
On 1 March, the employee submits a medical certificate to his employer, covering the period from 1 March to 10 March inclusive.
As a result, the employer may extend the employee's trial period by 10 days; instead of ending on 31 March, the trial period will end on 10 April.
End of the fixed-term employment contract
The fixed-term employment contract automatically ends on the end date or when the purpose for which it was concluded is achieved.
The employer is therefore not required to inform the employee in advance of the end of the working relationship or to give notice.
When a fixed-term contract comes to an end, the employer and the employee have 3 options:
- not to continue their working relationship beyond the end date;
- to continue their working relationship with a permanent employment contract (CDI);
- to continue their working relationship with another fixed-term employment contract.
Continuing the working relationship with a permanent employment contract
When the worker continues to work beyond the end date indicated in his fixed-term employment contract, the working relationship continues under a permanent employment contract and 2 possible scenarios become available:
- the employer and the employee continue their working relationship under the same terms and conditions as initially stipulated in the fixed-term contract;
- the employer and the employee negotiate the terms and conditions of a new contract, which immediately replaces the initial fixed-term contract.
In either case, the new permanent employment contract may not contain a trial period.
The employee's length of service must be taken into account as from the start date of his first fixed-term employment contract.
Continuing the working relationship with a new fixed-term contract
Renewal of the fixed-term employment contract
A fixed-term contract may be renewed twice for a fixed term. However, the total duration may not exceed 24 months, including renewals.
Failing this, the renewed fixed-term contract is recategorised as a permanent employment contract.
The renewal must:
- either be stipulated in a clause in the initial employment contract;
- or be part of an amendment to the contract signed by both parties.
Types of fixed-term employment contracts renewable in exceptional circumstances
Some fixed-term employment contracts may be renewed more than 2 times even for a duration exceeding 24 months without being recategorised as a permanent employment contract. These are namely fixed-term employment contracts concluded:
- with lecturers-researchers at the University of Luxembourg;
- with workers in the entertainment industry without steady employment;
- with students (for a maximum of 5 years);
- between the State or the commune and the following categories of personnel:
- executive assistants of a pre-school or primary education school;
- secondary school supply teachers;
- socio-educational officers of an administration or department under the Ministry of Education, Children and Youth (MEN);
- supply teachers at the Department of Adult Education (MEN);
- supply teachers at the Department of Vocational Training (MEN);
- supply teachers at the National Institute for Languages (MEN) ;
- supply teachers in specialised differentiated teaching institutes and departments;
- supply teachers at the Logopedics Centre (Centre de logopédie);
- between communes, communal associations or certain private institutions, on the one hand, and a supply teacher responsible for music education on the other hand;
- between the archbishopric, on the one hand, and a supply teacher for religion on the other hand, in order to carry out temporary replacements;
- between a federation or a sports club, on the one hand, and a trainer or sportsman/sportswoman on the other hand.
Successive fixed-term employment contracts
The same position may not be filled:
- by successive fixed-term employment contracts;
- and/or interim assignment contracts;
- and/or labour supply contracts.
Therefore, the employer may not directly offer a new fixed-term contract for the same position to the employee whose fixed-term contract has reached its term (i.e. at the end of 24 months maximum, renewals included), or any other candidate.
The employer must first allow for a waiting period to pass, corresponding to 1/3 of the duration of the contract that reached its term, including renewals.
A contract concluded in violation of these provisions is considered as a permanent employment contract.
Example: an employee has recently been hired on a fixed-term employment contract for a period of 12 months. His contract contains a renewal clause. At the end of the contract, his employer offers to renew his fixed-term employment contract for a period of 3 months. At the end of these 3 months, his employer renews his fixed-term employment contract once more for an identical period.
This employee's fixed-term employment contract has therefore been renewed twice and its total duration is 18 months.
If the employer wishes to hire the employee again, or any other employee, for a fixed-term period in order to fill the same position, he may only do so after a 6-month waiting period.
However, this waiting period does not apply to the following cases:
- if the employee replaced during the first contract period is still absent;
- if urgent works need to be carried out;
- if it is a seasonal employment contract;
- if it involves filling a position for which a permanent employment contract is not commonly used;
- if an employee on a fixed-term employment contract has terminated it before it reaches its term;
- if an employee on a fixed-term employment contract has refused to renew his contract despite a renewal clause;
- if it is a job offered to an unemployed person registered with ADEM in the framework of an insertion or re-insertion scheme, or a job offered to an unemployed person eligible for fixed-term employment, or a job intended to encourage hiring certain categories of unemployed persons, or a job for which the employer commits himself to provide additional vocational training.
Terminating a fixed-term employment contract
A fixed-term employment contract may be terminated before its term in the following 3 cases only:
- during the trial period by either the employer or the employee provided they comply with the notice period;
- in the event of serious misconduct on the part of the employer or the employee;
- in the case of a mutual agreement between the employer and employee. However, to be valid, the mutual agreement must be in writing, in 2 copies, signed by the employer and employee;
With the exception of these 3 cases, a fixed-term employment contract can not be terminated before the end of its term and both parties must commit to their obligations until the end of the contract. If, despite this, a fixed-term employment contract is terminated before it reaches its term:
- by the employee - the employee runs the risk that his employer may claim damages and interest, for actual damages incurred. However, the amount may not exceed the remuneration corresponding to the salary paid during the notice period which should have been worked by the employee if he had been under a permanent contract;
- by the employer - the employer must compensate the employee by paying him the amount he would have earned until the end of the contract. However, the amount may not exceed the remuneration corresponding to the salary paid during the notice period which should have been respected by the employer if it had been a permanent employment contract. The lump sum compensation paid covers both the moral and material prejudice suffered by the employee following the wrongful termination of the fixed-term employment contract.
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