Year End 31 st December An overview of French payroll Module 2
AGENDA • Fact • Tax • Culture • Social Security • Employment Law • Payslip review • Setting up a Business • Final settlement • Employer Obligations • Wage attachment • Time Management • Reports • Absence valuation • Sickness and Maternity
EMPLOYER OBLIGATIONS 3
New Employee Declaration of employment • The employer must complete a - Déclaration préalable à l'embauche (DPAE) prior to hiring each new employee. This declaration enables employers to complete all hiring formalities at once. • The declaration can be filed online at www.urssaf.fr or www.net-entreprises.fr The employer is responsible for making the relevant declarations and • contribution payments to the following bodies: URSSAF • POLE EMPLOI (contributions collected by URSSAF) • • which collects unemployment insurance contributions as well as contributions to the guarantee institution, Association pour la garantie des salaries (AGS) AGIRC and ARCCO • which collect supplementary pension contributions via the CRE • (ARRCO institution) and IRCAFEX (AGIRC institution)
New Employee HIRING PROCEDURES – DPAE https://www.due.urssaf.fr/declarant/index.jsf
New Employee
New Employee
DPAE - 8 Days before the start date If it is your first employee you must open your employer account with URSSAF • Employer registration to Pole Emploi • Employer registration to the occupational health service/department • • Employee registration at the caisse primaire d'assurance maladie CPAM Trigger for the medical examination an employee must undergo a medical • examination at the beginning of their employment to make sure that they are fit for the work Report - Déclaration annuelle des données sociales (DADS) •
ANNUAL HEADCOUNT
Base Salary Base salary – Definition – Link with compensation - French Labor Code (Articles • L211/1–L236/13) The salary range for each job classification should meet the statutory minimum • wage for that classification as outlined in the Collective Bargaining Agreements (CBAs) An employee cannot be paid a salary below this legal minimum – You should • ensure that the salary range for all positions meets the national statutory minimum wage There may be a specific pay element which, compares base salary, minimum legal • and statutory minimum wage for that job classification as outlined in the CBAs and you should take the best in favour of the employee
Basic Pay Basic Pay forms the basis of an employee’s earnings and is based on pay scales • The hourly and daily rates of pay are calculated from Basic Pay, which is based • on Pay Scales and by the CBAs and job classifications Pay Scale setup consists of Pay Scale types, Pay Scale areas, Pay Scale groups • and levels • Pay Scale groups generally represent the job grades in an organisation. According to the employee’s job grade, an appropriate salary structure is applied. Pay Scale area generally represents different collective agreement areas in • accordance with the collective agreement that occurs within the enterprise
Collective Bargaining Agreement’s
MINIMUM SALARY The rewards Specialist should ensure that the salary range for each job • classification meets the statutory minimum wage for that job classification as outlined in the CBA. • Ensures that the salary range for all positions meets the national statutory minimum wage. French Labour Code (Articles L211/1–L236/13) • The basic wage is usually paid once a month over 12 months or 13 • months. When wages are paid over 13 months, half of the 13th monthly • installment will be paid in June and the other half in December but this can be also paid in one month only (November).
Remuneration Remuneration based on worked hours : By far the most common remuneration, based on the time the employee is • present at the workplace, there is no reference to the amount of work the employee has to provide French labour laws use this formula to determine average monthly worked • hours : Hours worked per week (35) x weeks in a year (52)] divided by months in a • Year (12) This brings us to (35x52)/12 = 151.67 hours worked in a month when no • lateness or absence have been reported
Minimum Salary The employers should ensure that the salary range for each job classification • meets the statutory minimum wage for that job classification as outlined in the CBA And that the salary range for all positions meets the national statutory • minimum wage French Labour Code (Articles L211/1–L236/13) • The basic wage is usually paid once a month over 12 months or 13 months • When wages are paid over 13 months, half of the 13th monthly installment • will be paid in June and the other half in December but this can be also paid in one month only (November)
Minimum Salary In 2017, The statutory national minimum wage (SMIC) is €9.76 gross per hour. • This amounts to €1480,30 per month for a 35- hour work week for 151.67h a Month.
Minimum Wages In France Called SMIC : Salaire Minimum Interprofessionnel de Croissance • Current Gross Hourly Wages : €9.76 effective • Current Gross Monthly Wages : €1480.27 for 151.67 hours • Current Net Monthly Wages : €1149.07 • (Figure from 1st January 2017) • The SMIC is updated by government decree: • 1st January each year or • Whenever specific convenience goods prices increase over 2% •
EMPLOYMENT CONTRACT
MINIMUM WAGES IN FRANCE
SMIC The SMIC also includes monthly bonuses and benefits in kind but yearly • or one-time bonus are not. For instance the « thirteenth month bonus » (roughly an extra month • salary rewarded at the end of the year) cannot count in the SMIC index. And any bonus that is not directly related to the amount of work • provided. Bonuses can be fixed or variable but there are always in one of the • following category : -Contractual (Bonuses amount and frequency are written in the • employment contract) -Considered Contractual (The effect are the same as above but it is not • formaly written) -Benevolent (The employer have no obligation on amount and frequency) •
Bonuses The most common bonuses in France : Seniority Bonus : • To reward loyalty to the company, determined by industry-wide agreements • and the formula is usually: Seniority bonus = Percentage x Basic Salary • Sometimes the Basic Salary can be the one of the lowest rank of the industry and • it can also be a lump sum This bonus is independent of the amount of work provided and therefore is not • to be considered when calculating the SMIC
Bonuses Assiduity bonus : • This bonus rewards the efforts of the employee to avoid lateness • and absences It can be paid monthly or quarterly for the previous month or quarter • The assuiduity bonus in January will be earned during • February for instance Constraint bonus: • Proportional to the constraint (night shift, cold environment...) • Usually paid monthly • Results bonus: • Dependant of the industry-wide agreements • Thirteenth month bonus : • 1/12 of the yearly salary earned at the end of the year •
Seniority Bonus Seniority Bonus • Amount = Base * % • Base = mini du seniority coefficient * monthly hourly average / hourly • collectif Seniority Percentage: (issu de la table ANC) • Collective Bargaining Agreement = payable after 3 years. 1% per year • until the 15th year: 3%, 6%, 9%, 12%, 15%
Bonuses Table Name of the Subject to Subject to Subject to To be To be Bonus Contributions (FR : Levies (FR : Taxes ? accounted for accounted for Cotisations) ? Contribution Paid holidays Extra hours ? s) ? base ? Exceptional Yes Yes Yes No No Bonus Seniority Bonus Yes Yes Yes Yes No Assiduity Bonus Yes Yes Yes Yes Yes Constraint Yes Yes Yes Yes Yes Bonus Results Bonus Yes Yes Yes It depends No or any Bonus with objectives or targets. Thirteenth Yes Yes Yes No No month bonus.
Leavers de-registration Unless the collective bargaining agreement (CBA) or the • employment contract states otherwise the employment contract can be terminated without any restrictions during the probationary period Where an employee has passed/exceeded the probationary period set notice • periods will apply in line with the CBA or employement contract and the notice period will depend on the length of service If the employer terminates the employment they are required to issue a • written statement indicating the reasons for leaving The employer must provide the signed letter to the employee as a receipt • of all monies due before leaving A certificate for unemployment registration must also be provided on the • final working day and a copy sent to the unemployment office
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