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Financial Participation

In Luxembourg, no particular legal structures to facilitate or regulate the introduction of profit-sharing and employee share ownership schemes or tax incentives exist. Nevertheless, different forms of employee financial participation are common in practice.

Although the Luxembourgian Parliament and social partners discussed different issues of financial participation in the 1980’s, official government support or specific fiscal incentives for it have still been lacking.1 Despite the absence of a legal framework and tax incentives, a moderate growth of financial participation practice can be ascertained since 1990. Today, Luxembourg has a relatively high incidence of employee financial participation in the EU (following the findings from the latest European Working Conditions Survey).

In the context of new issues, several companies, particularly in the banking sector, offer shares to their employees. A large number of companies offers annual gratifications which are linked to company profit, but more often to other criteria such as seniority, appraisal of achievement, time absent, etc.2

Wilke, Maack and Partner (2014) Country reports on Financial Participation in Europe. Prepared for www.worker-participation.eu. Reports first published in 2007 and fully updated in 2014.