Luxembourg’s Inspectorate of Labour and Mines (ITM) is set to move from immediately fining companies which fail to comply with labour laws to instead providing advice to firms at fault, Labour Minister Georges Mischo said on Wednesday.

The decision follows strong criticism from individual entrepreneurs and company representatives, and was announced by Mischo at a press conference held jointly with representatives of the Horesca association.

“More emphasis should be placed on prevention and sanctions should be avoided,” said Mischo, outlining a policy change which was also stated in the CSV-DP coalition agreement signed in 2023.

Instead of carrying out checks straight away, visits to companies and discussions are to take place first in order to clarify what is not working.

Then, according to the plan, the companies would be given reasonable deadlines within which they would have to make the necessary adjustments. If an inspection is then carried out and the inspectors find violations, sanctions will be imposed.

Guidance for catering sector

The labour ministry and Horesca have drawn up a practical guide, a brochure that summarises the most important labour law provisions in the catering sector. At the same time, an information campaign is being launched with the aim of informing employers, employees, trainees and interns in the catering sector about their rights and obligations.

The catering sector is particularly affected by ITM inspections and sanctions. In 2023, the Labour Inspectorate carried out almost 1,300 inspections in companies, most of them (363) in the catering industry. Irregular working hours prevail there, which do not always fully comply with labour law.

The issue of rest periods

Labour law stipulates a rest period of at least 44 hours. However, there are companies in the Horeca sector that have an agreement with their employees regarding two non-consecutive days off, such as Sundays and Wednesdays.

Labour Minister Georges Mischo  © Photo credit: Alexander Daleiden

If there is such an agreement, the Horesca association would like ITM to take a pro-active stance and “turn a blind eye in this case”, said Steve Martarelli from Horesca.

“We will sit down with the sector again and see how we can solve the problem,” said Mischo – for example by means of an exemption.

Horesca President Alain Rix, who railed against the ITM last November and spoke of bullying, was very pleased with the changes presented on Wednesday. But it will not stop there. According to Rix, further talks will take place to resolve remaining issues such as the 44-hour rest period and breaks.

According to the law, only the first break in service counts as a break, and each subsequent break must be compensated, “which means that some restaurants have had to pay their employees horrendous sums for the break between lunch and evening service. This absolutely must be changed,” said Rix.

The issue of penalties

Another problem that still needs to be tackled concerns the amount of the fines. According to the law, they range between €251 and €25,000, but there is no catalogue of penalties and it is solely the ITM director who decides on the amount.

When setting the level of fine, the ITM director takes into account the circumstances, the seriousness of the offence and the behaviour of the author, according to the law.

However, these are very vague criteria that can be interpreted at will. The director also decides whether a penalty is cancelled or reduced. It is unclear to the companies how the amount is calculated or why it may have been reduced.

As part of the ITM reform, Mischo said that a type of catalogue of penalties is being drawn up and the sanctions are to be made more transparent and communicated in advance “so that companies know what to expect if they violate labour law”.

(This article was originally published by the Luxemburger Wort. Translation and editing by John Monaghan)