Article Post on 10 September 2008

Free Move of Persons and Immigration

The performance of work by non-European employees on the Luxembourg territory was mainly governed by the provisions of the Law dated March 28, 1972 on the right of foreigners to enter and reside on the Luxembourg territory, their medical examination and the employment of foreign labor force, as amended, and by Article L. 544-1 and followings of the Luxembourg Labor Code. These legal provisions are amended by a new law voted on July 9, 2008, the Law of 29 August 2008 concerning the free move of persons and immigration. This new law will be applicable one month after its entry into force.
Most differentiations
In accordance with both laws, the former and the new one, European citizen will be employed in Luxembourg without any work permit. The same applies in principle (however see under 2.) to European and non-European citizen, who are self-employed. However, in case of non-European employees, the former law stated that such will be employed in Luxembourg only with a work permit issued by the Ministry of Labor. Following the current law, there is no more “work permit” but an equivalent “a residence permit for employee” or “a residence permit for self-employed”. In practical, this is the same.


The former law

Employees

The work permit of the former law was granted on the recommendation of a special commission called the “commission d’avis special”. The Luxembourg Employment Administration (ADEM) played the role of a mediator between the employer, the employee and the Ministry of Labor.
Under this former regulation there were four types of work permit.

Category Maximum validity
A 1 year
B 4 years
C Unlimited
D Apprenticeship

Please note that non-European employees who have spouses as European citizens do not need to have a work permit.

The proceeding was the following: the employer must first inform ADEM that a job is available. The right of non-European employees to answer to any offer of an employment was subject to the priority that European workers registered as belonging to the labor force in Luxembourg enjoy over them. Therefore, only if ADEM does not propose an European employee it was possible to offer the job to a non-European employee. The employer had to submit to ADEM 2 copies of an engagement’s declaration. The Ministry of Labor required often from the employer a bank guarantee (a deposit of at least 1,487 Eur). The employer could recover this amount when the employee will leave the country of Luxembourg.

During the procedure for the grant of the work permit, the employment contract can be signed but only if there is a special provision in it concerning the effect of this contract after the approval of the Ministry of Labor. Until the approval of the Ministry of Labor, the employee was not entitled to work. Only after application has been granted and the work permit is issued, the employee can be hired.

A decision of the Labor Ministry refusing a request for a work permit could be appealed before the Administrative Court.

The Ministry of Labor allows an employer to hire a foreign employee to work permanently in Luxembourg only if the Luxembourg Labor Market had no qualified European workers available.

The occupation must be a professional position that requires, at a minimum, a high standard of education like a master or bachelor's degree in the field of specialisation.

We draw your attention that the Ministry of Labor’s recommendations to afford a work permit to a non-European employee may increase your labor costs. According to Ministry of Labor’s recommendations, a high wage may justify the use of a non-European worker.

Accordingly, the covered letter, which explains that the occupation is a specialty occupation and therefore needs particular skills which are not easy to find in the European labor market, does improve chance of obtaining a work permit. Moreover, the covered letter has to stress that the applicant has a bachelor's degree or the equivalent in the specific specialty or a specialized knowledge and the required qualifications and experience. The employer must supply the proof that a link between the occupation and the future employee exists and justify having resort to that specific non-European worker.

Self employed

In accordance with the provisions of the Law dated March 28, 1972 Non- European self-employed did not need a real “work permit”. It is more a residence permit. Nevertheless, they need an authorization of establishment to be delivered by the Ministry of “Classes Moyennes”.
It is advised to have a preliminary authorisation before the entrance in Luxembourg.
The self-employed shall fulfill the following conditions:

  • possession of all the needed qualifications /performances to perform this occupation;
  • prove of sufficient financial resources;
  • the activity shall serve the Luxembourg interests.

All these conditions are fulfilled in case the self-employed has an authorization of establishment delivered by the Ministry of “Classes Moyennes”.

Finally, non-European citizen shall follow many other proceedings:

  1. the entrance in Luxembourg: non-European citizen shall have a passport and a visa of entry in the European Union;
  2. the residence permit: a declaration within three days of the arrival shall be deposited to the municipality, in which the non-European citizen will live. In this respect, a non-European citizen shall fulfill the following conditions:
  • a certified copy of passport and visa;
  • certified copy of a prove of a correct accommodation (lease agreement or title deed);
  • prove of sufficient financial resources (employment contract, manager contract, declaration from third party, for example from spouse, or the articles of association of the company);
  • a certified copy of a recent extract of criminal record;
  • a medical attestation

 

THE CURRENT LAW:

Following the current law, there is no more a “work permit” but an equivalent “a residence permit for employee” or “a residence permit for self-employee”. In practical, this is the same.

Employees

All non- European employees shall fulfill the following conditions in order to have a “residence permit for employee”:

  • the work has to be declared free by the employer to the Luxembourg employment administration “ADEM”;
  • ADEM will check if any European employee is available for this work. If it is not, it is possible to employ a non-European employee;
  • the work shall serve the Luxembourg interests without any prejudice to EU member employee;
  • the employee shall have the right professional qualifications to perform this work;
  • the employee shall already have an employment contract.

All those conditions will be checked by a special commission and by the Luxembourg employment administration “ADEM”. A grand-ducal regulation has to be taken in order to explain this verification.

Please note that all those conditions are not required if the candidate is a high-qualified employee. We still do not know the special conditions to have this qualification. More information will be given by a future grand-ducal regulation.

This residence permit for employees is only delivered after the receipt of a proof of a suitable accommodation.

The “residence permit for employee” is delivered, the first time, for duration of only one year, for the same work and the same employer. It can be renewed several times, but the first renewal limits the duration of this work permit for two years. The following renewals grant a work permit for only three years.

Self-employed

Non-European self-employed need a real “residence permit for self-employed”.
The self-employed shall fulfill the following conditions:

  • possession of all the needed qualifications /performances to perform this occupation;
  • prove of sufficient financial resources;
  • the activity shall serve the Luxembourg interests.

The main amendment is that all these conditions are fulfilled in case the self-employed has an authorisation of establishment delivered by the Ministry of “Classes Moyennes”. Hence if a non-European citizen has an authorization of establishment, he will automatically have a residence permit for self-employed.

After the proof of a suitable accommodation, the self-employed will receive a “residence permit for self-employed”.

This “residence permit for self-employed” is delivered for a maximal duration of three years. It can be renewed several times, each times for three years, after the approval of a special commission.

Finally, non-European citizen shall follow many other proceedings:

  1. the entrance in Luxembourg: non-European citizen shall have a passport and a visa of entry in the European Union;
  2. the residence permit for self-employees: a declaration within three days of the arrival shall be deposited to the municipality, in which the non-European citizen will live. In this respect, a non-European citizen shall fulfill the following conditions:
  • certified copy of passport and visa;
  • certified copy of a prove of a correct accommodation (lease agreement or title deed);
  • prove of sufficient financial resources (employment contract, manager contract, declaration from third party, for example from spouse, or the articles of association of the company);
  • a certified copy of a recent extract of criminal record;
  • a medical attestation.

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