How to put together the ideal remuneration package?

Despite attractive salaries, luring talent to Luxembourg calls for a certain degree of resourcefulness. In some sectors, such as IT, banking or finance, multilingual and experienced profiles are in high demand. In this, case an attractive remuneration package becomes a powerful tool to attract candidates.

Company car, parking space, supplementary health insurance, pension scheme, meal vouchers, discretionary or performance-related bonuses... A great variety of perks are offered on top of the basic pay.

Perks that are enjoyed by 48% of managers in Luxembourg (1). One in three has a company car. One in four receives meal vouchers and about one in ten has a telephone, a parking space or their transport costs reimbursed. The employee stands to gain, as does the company, as these cost it less than the actual salary.

But these perks still make up quite a marginal share of remuneration, accounting for 3 to 7% of the gross annual salary.

The laws of attraction

AXA Luxembourg - Package salarial : l'importance des avantages en nature

The car and the bonus percentage top the list of the criteria most sought after by talents.

But for Julie Hornberger, manager at HR consultants Ajilon an attractive offer is above all an offer that has been properly appreciated by candidates. “Many people are badly informed about the perks they receive,” she explains.

In some cases, the advantages granted fail to live up to the candidates' expectations. "Employee satisfaction surveys tend to be very useful sources of this kind of information. They make it possible to identify the benefits abandoned by employees and which represent a cost for the company. HR teams would do well to regularly reassess the composition of the package offered to candidates," she adds.

Health first and foremost

AXA Luxembourg - la complémentaire santé, élément important d'un package salarial

Supplementary health insurance compensates for the portion of healthcare costs not covered by the national social security system. As an employer, you can finance this contribution for your employees and even propose to extend it to all family members. 

Some insurance companies allow you to choose the portion you want to finance, while the remaining portion remains the employee's responsibility.

A group supplementary health insurance is interesting in that it benefits all employees. And all are treated fairly, regardless of their medical condition, since there is no medical questionnaire to complete.

A perk that allows the company to control its costs and represents a significant saving for employees. In fact, were they to take out supplementary health insurance on an individual basis, the employee would have to pay 20 to 30% more than by enrolling with the company scheme, at the group rate.

Tax-efficient arrangements

AXA Luxembourg - Une fiscalité avantageuse sur les régimes complémentaires de pension proposés par les employeurs

In the banking and insurance sector, the supplementary pension plan is frequently part of the salary package, according to Remi Fouilloy, managing director of the recruitment firm Morgan Philips. This advantage is less widespread among other players in the financial sector - asset manager or Fintech. The same is true for service companies or the industrial sector that do not tend to offer it across the board.

And yet “this arrangement offers an undeniable tax break for employees in a country like Luxembourg where bonuses and incentives are highly taxed", he continues.

Indeed, the financing of supplementary pensions is taxable as a perk at a particularly favourable flat-rate of 20%. Another advantage of the pension scheme is that the employee can also contribute to it. In this case, they are eligible for a tax deduction capped at 1200 euros per year.

Retain and pamper your talents

AXA Luxembourg - Retenir et choyer ses talents grâce à un bon package salarial

Keeping your most valuable resources in the company is the other challenge facing human resources. And the pension scheme, like the supplementary health insurance, are valuable tools for this purpose.

The pension scheme makes it possible to implement a “retention” strategy by matching the scheme to the employee's seniority. This means that the company can choose to start the pension scheme after a certain period of seniority or make it conditional on a minimum period spent in the company. “Because the deadline seems far away, the pension scheme needs to be pushed by recruiters. But once acquired, it becomes difficult to give up,” adds the co-founder of the Morgan Philips group.

On the other hand, supplementary health insurance is a very concrete benefit for employees or candidates who can appreciate it on a day to day basis thanks to the reimbursements they receive.

Because the new generation is increasingly sensitive to pension provision and wishes to protect itself against the vagaries of life, AXA experts help you build a socially and fiscally attractive compensation policy to offer the ideal remuneration package. Supplementary health, retirement and provident insurance coverage are just some of the extra legal benefits  that your employees will be able to appreciate at their true value.

Do you need advice ?

An advisor is available in every region of the Grand Duchy to offer you his services and his well-informed advice about insurance solutions :