The Chamber of Commerce and the Chamber of Skilled Trades and Crafts present their proposal of six measures to enhance social protection for self-employed workers as we recover from the COVID-19 health crisis
This proposal is based on the prerogative of both professional chambers to submit legislative proposals to the government, which is required to pass on such proposals to the Chamber of Deputies when they fall within its jurisdiction. Both professional chambers thus intend to take the initiative by putting forward proposals that help to promote a legislative and regulatory framework that is conducive to economic growth and favourable to their members.
Importance of self-employed workers and entrepreneurship for the Luxembourg economy
Although we often only think of intellectual and liberal professionals (solicitors, architects, doctors, etc.) as self-employed people, the term “self-employed” encompasses in reality a wide range of workers. Many self-employed workers are sole traders established in their own name, operating as “sole proprietors”, as in the case of restaurateurs, cafe owners, electricians and bakers, for example. There were 6,875 sole traders in 2020. The term “self-employed” can also include individuals operating under mandates within commercial companies, craft companies, agricultural firms and intellectual businesses (representatives) and holding positions as managers, CEOs and directors.
Precarious status of self-employed workers
While entrepreneurship in Luxembourg is currently under threat, particularly in view of the precarious status of self-employment as regards social protection, this situation has clearly been exacerbated by the impact of the COVID-19 health crisis, which has been raging for more than 18 months.
In what remains an uncertain health and economic context, both professional chambers consider it more necessary than ever to foster entrepreneurial spirit and promote entrepreneurship given their importance to the Luxembourg economy and society.
They are therefore advocating for an improvement in the status of self-employed workers, which will entail reducing the inequalities that currently exist between the self-employed and employees as regards protection against “social risks”, which are at the root of either a temporary or a permanent loss of income.
A status ripe for fundamental change
Both professional chambers acknowledge that Luxembourg has introduced a few isolated measures in recent years to benefit self-employed workers by granting them rights similar to those of employees as regards the supplementary pension, parental leave, leave for family reasons and, more specifically in terms of social assistance (Revenu d'inclusion sociale – REVIS).
Nonetheless, the Chamber of Commerce and the Chamber of Skilled Trades and Crafts are calling for a comprehensive review of the social protection of self-employed workers, which would facilitate a complete overhaul of the status of these professionals. They also point to the fact that several governmental proposals benefiting self-employed workers were announced in the fourth SME Action Plan, as well as in the 2018-2023 Coalition Agreement in order to enhance social protection, and that the European Union is also working hard to protect the rights of self-employed workers through the European Pillar of Social Rights.
Six measures to bring the status of self-employed workers into line with that of employees
The proposal of the Chamber of Commerce and the Chamber of Skilled Trades and Crafts contains six measures relating to social security law and labour law.
In terms of social security, these measures consist in:
- making it possible for self-employed workers to combine an early old-age pension with professional income by putting in place a rule enabling overlapping of benefits (for self-employed workers and employees);
- better defining the status of the assisting spouse by adjusting the latter’s maximum contribution threshold, introducing a tier-based model and repealing the “division of income” principle;
- encouraging self-employed workers to join the “Mutualité des Employeurs”.
In addition, in terms of labour law, these measures consist in:
- extending all “short-time work”, “weather-related layoff” and “involuntary and temporary layoff” mechanism benefits to self-employed workers (through the introduction of replacement income governed by strict allocation conditions);
- bringing the full unemployment package available to self-employed workers more in line with that of employees;
- setting up a professional reclassification scheme for “self-employed workers” inspired by the existing scheme for employment injury and illness of self-employed workers in order to cover (temporary) loss of income and productivity.
All of these measures are described in detail in the proposal of the Chamber of Commerce and the Chamber of Skilled Trades and Crafts.
These proposals have been drafted in close cooperation with the UEL (Union des Entreprises Luxembourgeoises - Luxembourg employers’ association) and the various employers’ federations.
The both professional chambers’ proposal: a constructive approach
The measures included in the proposal of the Chamber of Commerce and the Chamber of Skilled Trades and Crafts are designed to be constructive and, in this regard, are general points for consideration. Some of them call for deeper analysis and dialogue with stakeholders (professional chambers, ministries, national experts specialising in matters of social security and labour law).
Both professional chambers remain at the disposal of the competent ministries and their administrations in order to establish a framework that is more modern and suited to self-employed workers.
The proposal by the Chamber of Commerce and the Chamber of Skilled Trades and Crafts with a view to enhancing the status of self-employed workers is available on the respective websites of the Chamber of Commerce www.cc.lu and the Chamber of Skilled Trades and Crafts www.cdm.lu.
 The Law of 26 October 2010, as amended, on the reorganisation of the Chamber of Commerce (in particular article 2) and the Law of 2 September 2011 , as amended, on the reorganisation of the Chamber of Skilled Trades and Crafts and amending the Law of 26 October 2010 on the reorganisation of the Chamber of Commerce (in particular article 5).
 Source: Systematic directory of businesses 2020: https://statistiques.public.lu/fr/publications/series/repertoire-entreprises/2020/repertoire-2020/index.html
 OIT Convention no. 102 identifies nine “social risks”: sickness (health care), sickness (benefit compensating loss of earnings), unemployment, old age, employment injury and illness, maternity, invalidity, death, dependants.