Pursuant to the amended Law of 29 August 2008 on the free movement of persons and immigration, only one single document, referred to as ‘residence authorisation’, serves the purposes of work permit and of residence permit. The extent of the residence authorisation depends on the applicant. The law mainly distinguishes between four different types of applicants for work:
- workers as employees;
- highly qualified workers;
- workers temporarily assigned in Luxembourg within an intra-company transfer; and
- workers temporarily assigned to Luxembourg under the terms of a cross-border services agreement (posting of workers).
The Law of 8 March 2017 transposing directives 2014/36/UE and 2014/66/UE and modifying the amended Law of 29 August 2008 provides new cases giving the right to a residence permit:
- workers holding a corporate mandate in addition to an employment contract;
- seasonal workers;
- third-national workers temporarily assigned in Luxembourg in order to ensure the continuation of their entity’s business (provided that the entity is duly registered as a certified entity in Luxembourg) in case of a major incident preventing the normal performance of the entity’s business in the country of origin; and
- intra-corporate transfer (ICT) for managers, specialists and trainee employees. The law of 8 March 2017 also distinguishes in this framework between a short (90 days within 180 days) and a long (more than 90 days) stay permit.
A residence permit as worker is granted on request to the third-country national if the four following conditions are fulfilled (article 42 of the amended Law of 29 August 2008 on the free movement of persons and immigration):
- it is not prejudicial to the priority of employment offered to some workers by EU regulations;
- the economic interests of the Grand-Duchy of Luxembourg must be served;
- the worker must have the required professional qualifications to carry out the activity; and
- the worker must hold an employment contract for this position, which has been previously declared vacant at the Employment Administration (ADEM) by the employer.
The residence authorisation as an employee is in this context valid for a period of one year, in one profession and one business activity, for any employer. It can be renewed for a three-year period, for whatever the profession or business activity.
One of the following conditions must also be fulfilled for the case of a worker holding an employment contract and a social mandate in the company, for which he or she could hold an establishment authorisation:
- the company must belong to a group of companies that will be established in Luxembourg. The company must also perform an activity provided by the law governing access to craft trade, commercial and industrial occupations, as well as certain professions, provided that the group has performed this activity for at least 24 months abroad and is considered as a medium-sized or large enterprise within the meaning of the Regulation (EC) No. 651/2014, or this activity fulfils a specific condition; or
- the company is established and truly active on Luxembourg territory.
A third-national allowed to stay must also demonstrate that he or she has appropriate accommodation at his or her disposal.
Thus, the employer shall first make a declaration of a vacant position to the Employment Administration (ADEM), in order to obtain, within three weeks, a certificate from the director of ADEM which states that no national has been hired and that the employer may hire the foreign worker. Then, the worker shall submit his or her request for a residence authorisation from his or her home country (ie, before his or her entry into Luxembourg), and send it to the Ministry of Foreign Affairs and Immigration. In the event of acceptance, the Ministry of Foreign Affairs and Immigration will send a letter (‘temporary residence authorisation’ (AST)) to the worker in his or her home country stating that he or she will receive his or her final residence authorisation once in Luxembourg. The worker then has three months from the date of issue of the AST to enter Luxembourg.
The worker shall also request a visa if needed in his or her country before entering Luxembourg. On entering Luxembourg, the worker needs to declare his or her arrival (ie, commune) to the town administration stating where he or she will be residing within the three days following his or her arrival. Finally, the worker shall present his or her declaration of arrival and the AST to the Ministry within the three-month period following the delivery of the AST, in order to obtain his or her ‘final’ residence authorisation.
The permit always has a fixed term, which is determined following the category of permit, and is renewable upon request.
When an employer wishes to employ a group of workers subject to a residence authorisation allowing them to work, the employer may request a collective authorisation from the Ministry of Foreign Affairs and Immigration.
As regards highly qualified workers, a European Blue Card may be delivered to third-country workers with a higher education degree or at least five years of professional experience comparable to a higher education degree whose qualifications are needed for the position. The worker shall receive a remuneration that equals at least 1.5 times the average gross annual remuneration to be published on an annual basis by Grand-Ducal Regulation (or 1.2 times in specific cases not yet determined by the government). Currently, the minimum gross annual remuneration for all qualified workers requesting a Blue Card is fixed at €73,998 for 2017 (€59,198.40 for highly qualified workers in specific professions where the government has noticed a particular need to employ third-country nationals (mathematicians, actuaries and statisticians, systems analysts, software developers, web and multimedia developers, applications programmers, software and application developers and analysts, multimedia developers not listed elsewhere, database designers and administrators, systems administrators, computer network professionals, database and network professionals not elsewhere classified)).
The first residence authorisation for a highly qualified worker is valid for four years or for the length of the employment contract plus three months, provided that the length of the employment contract is less than four years, in the activities for which he or she received the European Blue Card, for any employer. It can be renewed upon request for four years or for the length of the employment contract plus three months, provided that the length of the employment contract is less than four years and for any employment contract which fulfils the conditions of higher professional qualifications.
As regards workers temporarily assigned (article 47 of the amended Law of 29 August 2008 on free movement of persons and immigration) also called ‘transfer of employee’ in Luxembourg within an intra-corporate transfer, a residence authorisation may be requested by the host company in Luxembourg for a third-country national temporarily transferred to Luxembourg. The host entity shall:
- provide evidence that the host entity and the undertaking established in a third country belong to the same undertaking or group of undertakings;
- provide evidence of employment within the same undertaking or group of undertakings, from at least three up to 12 uninterrupted months immediately preceding the date of the intra-corporate transfer in the case of managers and specialists, and from at least three up to six uninterrupted months in the case of trainee employees;
- present an employment contract and, if necessary, an assignment letter from the employer containing the following:
- details of the duration of the transfer and the location of the host entity or entities;
- evidence that the third-country national is taking a position as a manager, specialist or trainee employee in the host entity or entities in Luxembourg;
- the remuneration as well as other conditions of employment granted during the intra-corporate transfer; and
- evidence that the third-country national will be able to transfer back to an entity belonging to that undertaking or group of undertakings and established in a third country at the end of the intra-corporate transfer;
- provide evidence that the third-country national has the professional qualifications and experience needed in the host entity to which he or she is to be transferred as manager or specialist or, in the case of a trainee employee, the university degree required;
- where applicable, present documentation certifying that the third-country national fulfils the conditions laid down under which union citizens exercise the regulated profession to which the application relates;
- provide evidence of having, or, having applied for, sickness insurance.
This ICT shall be submitted to the authorities of the member state where the first stay takes place. Where the first stay is not the longest, the application shall be submitted to the authorities of the member state where the longest overall stay is to take place during the transfer. An ICT permit is valid for at least one year or the duration of the transfer to Luxembourg, whichever is shorter, and may be extended to a maximum of three years for managers and specialists and one year for trainee employees.
During the period of validity of an intra-corporate transferee permit, the holder shall enjoy at least the following rights:
- the right to exercise the specific employment activity authorised under the permit in accordance with Luxembourg law in any host entity belonging to the undertaking or the group of undertakings in Luxembourg and to benefit from Luxembourg provisions of public order, including maximum working hours, minimum wage and minimum rest times applicable also during a secondment; and
- the right to the recognition of diplomas, certificates and other professional qualifications.
These rights are valid for third-country nationals of non-EU member states in possession of a valid ICT residence permit issued by a first member state and exercising their right to mobility in the territory of Luxembourg.
As regards cross-border services agreement (article 48 of the amended Law of 29 August 2008 on the free movement of persons and immigration), also called ‘secondment of employee’, a residence authorisation may be issued to foreign citizens temporarily assigned to Luxembourg under the terms of a cross-border services agreement with companies established in non-EU member states, EEA states or Switzerland.
This residence authorisation is not needed for foreign workers temporarily assigned to Luxembourg under cross-border services agreements with companies established in EU member states, EEA states or Switzerland, as long as the assigned workers are authorised to work and stay in the country where their employer is established.
If the assignment exceeds a three-month period, the employee shall automatically be granted a residence authorisation bearing the words ‘employee of a community service provider’ completed by the name and the corporate name of the service provider and the beneficiary of the service in Luxembourg.
To be subject to an authorisation of posting, the employee must be related to his home company performing the posting by an open-ended employment contract, provided that the start of this contract is previous to at least six months from the start of the posting in the territory of Luxemburg for which the authorisation is asked.
The authorisation of posting is granted for an effective duration expected for the accomplishment of the service provision. It may be extended in exceptional circumstances if the service provision could not be completed within the initial deadline.
Sanctions for employing a foreign worker who does not have a right to work in the jurisdiction
According to article L572-4 of the Labour Code, an employer who hires one or more illegally staying third-country nationals shall be punished by an administrative fine of €2,500 per illegally staying third-country national.
An employer may also be punished with imprisonment from eight days up to one year and a fine of €2,501 up to €20,000 for each illegally staying third-country national worker or to one of these sanctions only (article L572-5 of the Labour Code) if the employer hired an illegally staying third-country national in one of the following circumstances:
- the infringement is persistently repeated;
- the infringement concerns the simultaneous employment of a significant number of illegal third-country nationals;
- the infringement is accompanied by particularly exploitative working conditions;
- the infringement is committed by an employer who uses work or services from an illegally staying third-country national with the knowledge that she or he is a victim of trafficking in human beings; or
- the infringement relates to the illegal employment of a minor.
In addition, article L572-6 of the Labour Code also foresees accessory criminal sanctions such as:
- the prohibition for up to three years to practise a social or professional activity that was directly or indirectly used to commit the breach; or
- the temporary closure for a maximum of five years or the definitive closure of the company or the establishment used to commit the breach.
If the employer hires a worker without having notified a declaration of a vacant job to the National Employment Administration, he may be subject to a fine of €251 to €2,500.
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