Employment & Labor Law
Redundancy in Luxembourg: how to check the economic grounds given
A reorganisation, a downturn in activity or the elimination of a position may be cited to explain a dismissal. However, describing it as “economic” is not enough to understand the decision. To assess it, you need to identify the precise reason, its connection with the job held and the evidence available when the employment ended.
Obtain an explanation you can assess
For a dismissal with notice, an employee generally has one month from notification to request the reasons by registered letter. The employer must then reply within the statutory period. This step affects the evidence in any subsequent challenge: an informal exchange with human resources must not be confused with the formal request provided for this purpose. [1]
Keep the dismissal letter, envelope, proof of delivery and subsequent correspondence. Record separately the deadlines for requesting the reasons, challenging the dismissal and the end of the notice period. These dates serve different purposes.
Connect the reorganisation to the eliminated position
The assessment is not simply a question of whether the business is making a loss. Luxembourg case law recognises that an employer may organise its business without waiting for major economic difficulties. Review focuses, in particular, on whether the reasons given are genuine and how they relate to the measure taken. [2]
To prepare for a review, compare the job description before and after the decision. Have the duties disappeared, been combined or been distributed among several people? Is there a recruitment advertisement for similar functions? A job with the same name does not necessarily have the same duties; conversely, a new title may cover comparable responsibilities. Compare the functions rather than titles alone.
Build a file without reaching premature conclusions
Gather your contract, amendments, accessible organisation charts, internal announcements and the statement of reasons. Identify the date of each document. An advertisement published several months after the employment ended does not automatically carry the same significance as recruitment begun at the time of dismissal.
Also avoid conflating three issues: the justification for terminating employment, compliance with procedure and payment of the sums owed. A correctly calculated payment does not, by itself, answer the question of the grounds for dismissal. Nor does challenging those grounds remove the need to check the final employment payments.
Several positions eliminated: check the collective framework
If several people are affected, establish a chronology of the departures and their nature. The file must be assessed against the collective redundancy regime where its conditions are met. Do not conclude that a social plan does or does not exist solely on the basis of your own letter.
Does the elimination of a position make any challenge pointless?
No. The description used by the employer must be examined against the explanations and documents. It does not predetermine the outcome of a challenge.
Should you wait until the notice period ends?
It is preferable to have the deadlines checked as soon as you receive notification. Waiting for the final payslip may waste time needed for a separate step.
KM Legal assists you in reviewing the economic grounds, the procedure followed and the options for discussion or challenge.
Sources and references
Institutional sources consulted on 6 November 2026.
Further reading
[ Recent Publications ]
