COMPANIES & STRATEGIES - FINANCE & LEGAL

Legislation

Furlough reform unworkable for businesses, says union



The changes, if adopted, would demand unnecessary and unrealistic new tasks from employers, says business union UEL.  Copyright (c) 2018 MIND AND I/Shutterstock.  No use without permission.

The changes, if adopted, would demand unnecessary and unrealistic new tasks from employers, says business union UEL.  Copyright (c) 2018 MIND AND I/Shutterstock. No use without permission.

The UEL--a private sector business group for Luxembourg--on Monday said plans to reform partial unemployment would be unworkable for companies, calling out the lack of social dialogue on the government’s part. 

The draft law n°7858 suggests increasing the number of hours an employee can work under so-called “chômage partiel” from 1,022 to 1,714. In addition, every request would include a mandatory dossier describing the future growth of the company and the investments planned to ensure the company’s development in the short, medium, and long term. Lastly, employees in the process of contract termination would not be eligible.  

The proposal was presented as part of a package of new labour laws, including the right to disconnect and anti-bullying legislation.

While the UEL said partial unemployment was useful during the covid-related lockdown in 2020, it called the draft law unrealistic, inappropriate and currently irrelevant. The union said that it adopts elements from the pandemic without verifying the long-term effects of such changes.

Partial unemployment had been widely applied in Luxembourg since 2020, as the pandemic and July floods hit the country and its economy. Between 2020 and 2021, €1bn was spent by the government, allowing employers to not lay off staff, but €394m was borrowed and had to be reimbursed.

In its statement, the UEL says: “The bill thus calls into question the post-crisis balance of the short-time working procedure, which has nevertheless proven itself outside the current crisis. The employers’ organisations disapprove of a draft text that makes access to structural partial unemployment conditional on the conclusion of a plan to maintain employment.”

The UEL said such plans would be impractical as the training requirements are impossible to define when developing a job retention plan. This would especially be the case of sectorial jobs where individual plans would have to be laid out for each request, it said.

The reform would introduce more red tape to accessing support, the UEL said, also slamming the government for not seeking dialogue with businesses and employer unions while working on the draft that is now making its way through parliament.