In response to the challenges related to the evolution of banking professions and their attractiveness, the ABBL and the union representatives of ALEBA, OGBL, and LCGB have reached an agreement on the collective bargaining agreement for the Luxembourg banking sector for the period 2024-2026. The final texts are now in the approval phase. The new agreement emphasizes employability and allows for the rewarding of loyalty and commitment of employees in the banking sector.

Banking: A Profession in Rapid Evolution

“The evolution of professions related to banking services has accelerated in recent years, pushing bankers to develop new skills,” analyzes Jerry Grbic, CEO of the ABBL. “At the same time, to address these challenges, Luxembourg banks face the triple challenge of attracting, training, and retaining talent, all within a highly competitive market and a shrinking pool of recruits.”

The challenges are numerous:

• Evolution of customer expectations towards more accessible and transparent services.
• Integration of digital technologies and artificial intelligence, which automate some traditional tasks and enhance the personalization of customer services.
• Increasingly stringent regulations requiring heightened vigilance in compliance and risk management.
• Competition from fintechs driving innovation and diversification in banking offers.
• Development of cybersecurity risks and online fraud.

Social partners have revised some provisions of the current agreement to create a conducive environment for bank employees to better navigate these changes, as well as to enhance the attractiveness of the banking sector and thus contribute to its sustainability and future growth.

Training at the Center of Attention

Training is essential for the employability of employees in the banking sector, as it allows them to acquire the necessary skills to adapt to technological, regulatory changes, and new customer expectations, ensuring their relevance and competitiveness in the job market. The new collective bargaining agreement includes several advancements in this context. Thus, the budget allocated by banks for training has been increased by 10% for the 2024-2026 period. Additionally, each covered employee will be allocated a minimum of 16 hours of individual training per year (excluding mandatory and retraining courses). Overall, provisions related to employability have been drafted to emphasize the joint commitment of both the employee and employer in this area.

Rewarding Employee Loyalty and Commitment

It was crucial for the new agreement to reward the loyalty and commitment of those on whom the success of each company relies, namely its employees. As a result, the loyalty bonus has been revalued, departure thresholds and scale thresholds have been increased, and the budget allocated by banks to reward deserving employees has been raised. Furthermore, a special bonus was negotiated upon the signing of this new agreement and will be paid out in January 2025. Finally, the balance between private and professional life was also an important point in the discussions. A new chapter has been created in this regard, and each company is encouraged to implement flexible work options tailored to the specific needs of the business and employees. The discussions around the new collective bargaining agreement took place in a constructive spirit, demonstrating the responsibility of all signatories not only towards the sector’s employees but also from the entire Grand Duchy, the banking sector being, in fact, a pillar of the country’s economy and contributing decisively to its prosperity.  

The new collective bargaining agreement highlights a few major points:

• Exceptional bonus of EUR 500 for all employees, payable in 2025.
• Increase in the loyalty bonus.
• Financial envelope to be distributed for 2024, 2025, and 2026 to reward employee commitment.
• Increase in severance amounts and thresholds for the 4 groups.
• Increase in the presumption of skill acquisition.
• Implementation of a minimum budget for training within the framework of outplacement of EUR 5,000 (with a maximum of EUR 8,000).
• 10% increase in the annual training budget.
• Allocation of an individual training allocation of at least 16 hours per year.

  Communicated by OGBL, LCGB, ALEBA and ABBL, 11 July 2024