France: Voted Measures to Increase Workers’ pouvoir d’achat
During this summer, plenty of measures have been voted to increase workers’ pouvoir d’achat. Let’s focus on those measures. As of 1 August, the gross hourly minimum wage is increased to 11.07 euros. This means that the gross monthly minimum wage will rise from 1,645.58 euros to 1,678.95 euros gross. Two important laws were published on 17 August 2022: the rectifying finance law of 16 August and the law on emergency measures to protect purchasing power of 16 August. The main measures are as follows:
- The exceptional purchasing power bonus, introduced in 2019, is replaced by the “value-sharing bonus”. It is introduced by mean of collective bargaining agreement or a unilateral decision of the employer, after consultation of the CSE if any. Its amount, left to the discretion of the employer, may differ according to the beneficiaries’ remuneration, classification level, seniority in the company, the length of actual presence during the past year or the or the duration of working time. The bonus can be paid in one or more instalments, up to a maximum of once per quarter, during the calendar year. It is exempted from social security contributions up to a maximum 3,000 euros per beneficiary per calendar year, or 6,000 euros in certain cases. All employees are eligible regardless of salary. However, for payments made between 1 July 2022 and 31 December 2023, employees earning up to three times the minimum wage are also exempt from income tax;
- In companies having profit sharing schemes, the law creates a new case of early release of employee savings for the “purchase of goods or the provision of services”. Employees will be able to request the release of their savings before 31 December 2022, up to a limit of 10,000 euros without this sum being taxed;
- Other measures on profit sharing include: the increase of the maximum duration of optional profit-sharing (intéressement) from 3 to 5 years, the possibility for companies with less than 50 employees to unilaterally adopt such schemes
- A reduction in employer contributions for overtime will apply from 1 October 2022 for companies with 20 to 249 employees. A decree will set the amount of this flat rate reduction;
- Until 31 December 2025, an employee may, at his or her request and in agreement with the employer, waive all or part of days of rest or “RTT” provided for by the collective bargaining agreement in relation to working time This renunciation to days or half-days give rise to an increase in salary and benefit from a favourable social and tax regime.
- Some tax exemptions in relation to meal vouchers and transport allowances are also improved during a limited period.
Specific short time scheme for COVID vulnerable persons
Employees who are deemed to be “vulnerable” (proven risk of developing a severe form of Covid-19) and who are unable to work even remotely may be placed under a specific short time work regime. A decree is to determine the medical factors characterizing such vulnerability.
Protection of whistle-blowers
The law of 21 March 2022 strengthening the protection of whistle-blowers came into force on 1er September. Companies must bring their internal regulations into line with the new provisions of the Labour Code and mention the existence of the whistle-blower protection scheme. The articles of the Labour Code on sexual and moral harassment, which are reproduced in the internal regulations, must also be updated.
Implementation of the transparent and predictable working conditions directive
On August 1st, 2022, the directive of 20 June 2019 on transparent and predictable working conditions in the European Union came into force. It extends the list of information to be given to the candidate at the time of recruitment and shortens the deadline for providing this information (at the latest within seven calendar days from the first day of work for essential information and at the latest within one month from the first actual day of work for non-essential information). In addition, it provides for the establishment of minimum rights for workers to enhance the predictability and transparency of the employment relationship and to safeguard the health and safety of the employee. In particular, the maximum duration of the trial period is thus set at a maximum of 6 months (a longer period may be provided for under certain conditions); exclusivity clauses are prohibited (a mitigation may be made when justified by the protection of business secrecy or the prevention of conflicts of interest). The practical impact in France is limited as a written employment contract containing most of those provisions is already normal practice.