Home Publications Articles ILO, Employment & Benefits, September 2017

ILO, Employment & Benefits, September 2017

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New obligations regarding record keeping and business contracts and subcontracts

Following the recent entry into force of the law of March 14 2017 relating to the secondment of employees, a number of additional legislative changes have been made (for further details please see "New law concerning posting of employees").(1)

Special record of work hours

The legislature recently amended Article L211-29 of the Labour Code, which concerns special records of employee working hours. The article now stipulates that employers must add to a "special record or file the start time, end time and hours worked each day", as well as the information previously required – namely:

  • any extension of an employee's normal working hours;
  • any hours that the employee works on a Sunday, statutory bank holiday or overnight; and
  • the remuneration paid in such cases.

These new requirements, which were introduced at the same time as the law of March 14 2017, will ensure that foreign employers seconding employees to Luxembourg and employers based in Luxembourg are treated equally, as they now have the same record-keeping obligations with regard to working hours.

Business contracts and subcontracts

A new article was recently added to Title VIII (Obligations and responsibilities of the client or instructing party within the context of a business (contrat d'entreprise) or subcontracting contract), Book II of the Labour Code.

Article L. 281-1 imposes three obligations on clients (ie, the business that places the order for a contract from a main contractor) and instructing parties (ie, the main contractor that subcontracts out the execution of the work) entering into contracts with service providers – namely:

  • a general obligation to provide information to the Inspectorate of Labour and Mines (ITM);
  • an injunction obligation for the service provider, or any company involved in the subcontracting chain – if applicable – which aims to make the latter cease any breach of public social rules as observed by the ITM; and
  • an obligation to report to the ITM if a defaulting company (ie, a service provider or employer involved in the subcontracting chain) has not confirmed that it has resolved the situation within 15 days from the injunction.

If a client or instructing party fails to fulfil the abovementioned obligations relating to injunctions and reporting, they are bound jointly and severally with the defaulting company to pay the remuneration, compensation and charges owed to the latter's employees, if applicable.

In the event of a secondment, the client or instructing party will also be liable for an administrative fine ranging from €1,000 to €5,000 per seconded employee and €2,000 to €10,000 in the event of a repeated offence within two years, with a maximum total fine of €50,000.

Comment

Although resulting from the law of March 14 2017 regarding the secondment of employees, these new obligations are not aimed exclusively at situations involving the secondment of employees in Luxembourg by a foreign company. Rather, they apply to all business contracts and subcontracts subject to Luxembourg law. The scope of Article L281-1 excludes only private individuals who enter into a contract with a company for their personal use or that of their spouse, partner, ancestor or heir.

Endnotes

(1) The law of March 14 2017 is available here.

http://www.internationallawoffice.com/Newsletters/Employment-Benefits/Luxembourg/Castegnaro/New-obligations-regarding-record-keeping-and-business-contracts-and-subcontracts?utm_source=ILO+Newsletter&utm_medium=email&utm_content=Newsletter+2017-09-13&utm_campaign=Employment+%26+Benefits+Newsletter