Economy & Politics

They say no to the minimum wage hike

After the Union des entreprises, the Confederation of the middle classes is also raising its tone in the face of the 2.8% increase in the lowest incomes. “A fatal signal to small and medium-sized businesses,” she said.

Patrick JACQUEMOT

Patrick JACQUEMOT

After the Union des entreprises, the Confederation of the middle classes is also raising its tone in the face of the 2.8% increase in the lowest incomes. “A fatal signal to small and medium-sized businesses,” she said.

On Monday, at a press conference, the Prime Minister did not say a word about the increase in the minimum social wage (SSM). Way for Xavier Bettel to dissociate this announcement from the measures related to the fight against the epidemic which should be voted on Wednesday. Except that the timing of anti-covid devices and that of the 2.8% increase in SSM are common. Thus, the increase in the lowest incomes should occur from January 1, 2021, at a time when the effects of the crisis will still be relevant.


Politik, Tripartite, Chateau de Senningen, Xavier Bettel, Nora Back, Patrick Dury, Sylvain Hoffmann, Dan Kersch, Francois Bausch, foto: Chris Karaba / Luxemburger Wort

A few hours before the Prime Minister’s speech on the probable implementation of new restrictions intended to fight the pandemic, OGBL and LCGB are asking the government for an early meeting compared to the initial schedule.


As soon as it was revealed, the social gesture provoked the anger of the Union des entreprises. The Luxembourg employers demanding abandonment pure and simple of the measure before it is proposed to the deputies. Now, it is the voice of the (discreet) Confederation of the middle classes which expresses its same refusal. This in the name of “iinterests of 30,000 companies employing 200,000 employees “who form this grouping of the Chamber of Commerce, the Federation of Craftsmen and the Hotel and Catering Industry (Horesca).

In the opinion of this Confederation, these 72 euros monthly increase for nearly 60,000 employees in the country, constitutes “a fatal signal to small and medium-sized enterprises”. All the more so since Xavier Bettel caught entrepreneurs in the hospitality, trade and craft sectors by surprise. No one expected this choice, “a bomb”, motivated by a catching up of low wages compared to the average increase in wages over the past two years.

Representatives of SMEs note that this “political choice” intervenes “against good economic sense, against the ability of companies to preserve and create new jobs and, ultimately, against employees in the sectors concerned ”. The fear is that some employers, deprived of prospects, of financial reserves, will end up shutting down and not being able to assume at their level this boost to the SSM which would pass to 2.642 € / month for qualified employees. Anticipating the index which should no longer intervene before 2022, according to Statec.

The fate of the independents

And while the government will try to amortize the additional expenditure by grantingdirect aid of € 500 per employee vulnerable sectors, this remains insufficient in the eyes of critics of the increase. They recall in passing that in 2011, during a previous increase in the SSM in a context of crisis, “the Juncker-Asselborn government had granted all the companies concerned financial compensation”. To see if the deputies will take up this idea to pass the pill.

But in the eyes of the UEL as of the Confederation of the middle classes, it is more urgent to worry about the fate of the independents. They do not receive a “replacement salary”, as any employee is entitled to under partial unemployment. A proposal that the employers had put forward in the spring but which has not yet caught the attention of the Minister of the Economy Franz Fayot (LSAP) or the Middle Classes Lex Delles (DP). They have so far preferred to bet on aid packages to be requested rather than compensation income assumed by the State.


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