Unemployment insurance/benefit

Unemployment insurance is mandatory for all employees working in Luxembourg; contributions are paid by the employee as a special solidarity tax of 2.50% of salary. The governmental level of financing is set annually by legislation.

To qualify for unemployment you need to have worked in Luxembourg for at least 26 weeks in the last twelve months and to have left your job for reasons not of your own free will.

The employment administration ADEM (l'administration de l'emploi) is responsible for paying your unemployment benefits and for helping you find a new job. It is imperative that you contact them within fifteen days (if possible on the first day) of the end of your employment contract in order to register as a job seeker and claim your rightful benefits.

You must go in person to the ADEM agency in your region and ask the reception (accueil) for a questionnaire and a jobseekers guide (guide du demandeur d'emploi). You also need to make an appointment with a placement officer who will register you as a job seeker, help you with the necessary papers and make an appointment for you to register for unemployment benefit.

The documents you need to register for unemployment benefit are as follows:

• the introduction card (carte de presentation), which will be prepared by your placement officer;
• the tax payment card (fiche de retenue de l'impôt), which you automatically receive when you start employment;
• your last six salary slips;
• a copy of the letter of dismissal or redundancy from your old employer and your employment contract;
• the completed forms (following your meeting with the placement officer).

Please note: if you register for unemployment benefit within fifteen days of the end of your contract you will receive unemployment benefit backdated to the day you stopped work. However, if you register later your benefit will start from fourteen days before you registered, e.g. if you register after thirty days you will only receive benefit backdated from the last fourteen days.

Benefit is paid for twelve months at a sliding scale:

• first six months - 80% of basic salary (85% if applicant has a dependent child), up to 2.5 times the social minimum wage;
• last six months - the same % of basic salary, up to 2 times the social minimum wage.

The amount is reduced if you live with someone who earns more than twice the social minimum wage. Benefits are automatically indexed to changes in the cost of living.

While you are unemployed you will be asked to report every two weeks to the ADEM and you will have to show that you are actively looking for work. You will also be asked to occasionally attend meetings. From time to time the ADEM may send you for job interviews which they think suit your job profile and which you must attend. The ADEM also offers classes, such as a language course, to help improve your job skills.