Impact of the changes to wages, salaries and pensions (+2.5%) on 1 October 2021

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Date:
07 Oct 2021

Newsflash

By:
Dorothée David

According to the definitive results published by STATEC in its press release issued on 6 October 2021, the annual inflation rate for the national consumer price index (“indice des prix à la consommation national” or IPCN) was 2.7% for September 2021, thus triggering a new indexation.

As a result, the new sliding wage scale index for salaries went from 834.76 points to 855.62 points on 1 October 2021, resulting in a 2.5% rise in wages, salaries and pensions on this date.

So, as of 1 October 2021, the new minimum monthly social wage (SSM) has been recalculated as follows[1] (index 855.62):

  • 2,256.95.- EUR gross for an non-qualified employee (over 18),
  • 1805.56.-EUR for those aged 17 to 18,
  • 1,692.72.-EUR for those aged 15 to 17,
  • 2,708.35.- EUR gross for a qualified employee.

In addition, the salary index as of 1 October 2021 affects the different thresholds and limits stipulated by law, summarised in the table below:

As of 1 October 2021 (gross totals, index 855.62):

 

Monthly SSM

(art. L. 222-9 and L. 223-1 of the Labour Code)

 

2,256.95.- EUR (non-qualified employee)

2,708.35.- EUR (qualified employee)

 

  • Agreed compensation
  • Damages and interest for unfair dismissal set by the labour court,
  • Voluntary compensation in the event of resignation or termination by mutual agreement

(art. 115 para. 1 point 9 of the L.I.R.)

 

 

Automatically exempt from tax up to:

 

26,423.16.- EUR (unchanged)

 

(12 x the SSM applicable on 1 January in the taxation year)

 

 

Starting minimum monthly wage required to apply a trial period of 7 to 12 months

(art. L.121-5 (2) of the Labour Code)

 

4,586.12.- EUR

 

Minimum gross annual salary required at the end of the contract to apply a non-competition clause after the end of the contract

(art. L. 125-8 (3) of the Labour Code)

 

over 58,328.21.- EUR

 

 

[1] The above amounts are provided for information purposes and are subject to official confirmation.