Getting Started in French Payroll Module 3. Presented by Denis Barnard

Transcription

1 Getting Started in French Payroll Module 3 Presented by Denis Barnard

2 Agenda Time management Contracts Net Guarantee Loans and advances Final settlement Wage attachment

3 Time Management 3

4 35H agreement, RTT and Leaves RTT (Time off requirements as compensation for working more than 35 hours per week) is managed through the T&A systems Hours of delegation = Employee attendance as delegated to union meetings will be managed through the T&A/work management schedule and are generally not administered as a leave type through payroll Job Search Leave = Leave allowed during an employee s notice period for job search will be managed as a local agreement between the line manager and the employee and does not require leave administration, however this agreement is confirmed in a letter to the employee within the separation agreement

5 Attendance

6 Daily Work Schedule

7 Absence Type Catalog

8 Absence Type Catalog

9 Overtime Overtime exists when an eligible payee works more than the standard number of hours during a week stipulated by the French government If a payee works overtime, an employer is obligated to pay a surcharge on the extra time worked If the extra time worked exceeds a second limit, then an employer may have to give the payee time off in lieu (repos compensateur)

10 Overtime Overtime calculations are based on a weekly calculation of hours worked, but in certain situations the standard working hours can be calculated on a yearly basis This is referred to as the modulation of working hours. The modulation of working hours can be set up in companies if a collective agreement or a company or establishment agreement exists Limit = 220 hours a year for employees

11 Overtime Some overtime may be taken as time off in lieu of compensation. These hours are known as bonus hours. There are two different types of compensation in lieu of time off : Repos compensateur This type of compensation adheres to certain regulatory rules for its calculation. This type stipulates that when a payee works over a weekly hour limit in a week, that payee is entitled to receive some hours paid with a surcharge and to also acquire some compensation in lieu entitlement

12 Overtime There are two different types of compensation in lieu of time off : Récupération d heures This type is not stipulated by regulations and companies can decide whether to apply this rule This type enables a payee to take some time off instead of being paid for the overtime

13 IJSS (social security daily allowance) When an employee is eligible to receive a daily IJSS allowance during an absence, the employer must uphold the employee s salary The term subrogation is used to refer to this method of paying IJSS Eligibility = Subrogation will be applied to employees who are employed for more than one year according the collective agreement (depends on company and CBA s) Daily IJSS allowance is not taxable Sickness - IJSS The elements to take into account are illness, work accidents, and maternity

14 Managing the Net Guarantee French law requires employers to pay a guaranteed percentage of a payee s gross salary during the time that the payee is on sick leave, subject to certain conditions Alternatively, some collective agreements stipulate a guaranteed percentage of a payee s net salary during a payee s sick leave Many collective agreements stipulate that the allowance paid to a payee during the payee s illness, after deduction of the social security daily allowances, cannot result in the payee s net salary exceeding the net salary earned when the payee is not on sick leave This is called the guarantee on the net salary (garantie sur le net)

15 Managing the Net Guarantee Daily cash benefits In the event of incapacity for work, a sick note must be obtained from a doctor Daily cash benefits are payable as from the 4th day of absence from work The daily benefit is equal to 50% of the daily wage of the last three months up to a limit of 1/91.25 of the quarterly wage subject to a ceiling of 1.8 times the annual SMIC and two-thirds of the daily wage as from the 31st day of sick leave if the insured person has three or more dependent children, up to a limit of 1/ of 1.8 times the annual SMIC (with maximum amounts - as of 1st January of and respectively)

16 Managing the Net Guarantee Daily cash benefits For long-term illnesses, the daily benefit can be paid for a maximum period of three years from beginning to end date for each illness. For all other illnesses, the maximum number of daily benefit payments over a three year period is 360

17 Government Subsidised Contract A French government-subsidised contract is a contract derogating from the ordinary law for which employers will receive additional aid relating to hiring grants, training subsidies or exemption/reduction in certain obligations, such as social security and tax payments Contrat d'accompagnement dans l'emploi / CAE Contrat d'adaptation Contrat d'apprentissage Contrat d'avenir

18 Government Subsidised Contract Contrat de professionnalisation Contrat de qualification Contrat d'emploi consolidé / CEC Contrat d'orientation

19 Government Subsidised Contract Contrat insertion - revenu minimum d'activité / CI-RMA Contrat jeunes en entreprise / CJE ou SEJE Contrat unique d'insertion / CUI

20 Specific Contracts Apprentices Trainees Qualification contracts Fixed-term contracts Specific categories of payees Brackets for specific contracts Orientation contracts Adaptation contracts Special part-time contracts

21 Specific Contracts Specific contracts give exemptions on contributions Usually they are set up between an employer and a government department or between an employer and payee, subject to controls from the DDTE (the regional government organization that is responsible for employment laws) The payroll system should deliver rules for some common exemptions regarding some fixed-term contracts, specific exempted contracts, and specific categories of payees Specific contracts have an impact on many areas of the payroll process

22 About the new state-subsidised work contract in France (Known as Contrat Unique d'insertion)

23 Contrat Unique d'insertion Voted on the 1st of December 2008 and enforced on the 1st of January 2010 this law replace all the subsidised work contracts such as : Contrat d'accompagnement dans l'emploi (CAE) Contrats d'avenir CI-RMA (Contrat insertion Revenu minimun d'activité).# CIVIS (contrat d'insertion dans la vie sociale)

24 Contrat Unique d'insertion All of these are now regrouped in a single contract : Contrat Unique d'insertion (CUI) Rather loosely translated as Unique Contract of (labour market) Integration This contract aims at helping professional integration for persons in a difficult situation towards labour market

25 Contrat Unique d'insertion This work contract can be either permanent / temporary ; full-time / part time The contract is signed between the employer and the employee and one of these organisation : Pole emploi (National French job-seeker agency) or the conseil général (Regional council)

26 Contrat Unique d'insertion Main features : 20 hours per week minimum Minimum salary equal to SMIC (French legal minimum salary) In the case of a training contract : 200 hours minimum Pole emploi must check that the training program is actually followed A tutor must be appointed to coach the employee

27 Contrat Unique d'insertion Cancelling the contract: If the employee finds a permanent or temporary (more than 6 months) position By the employer during the trial period If Pole emploi is asking for a ''Workplace evaluation'' (EMT in French) Regular ending of the contract The employer has to deliver a reference 1 month after the end of the contract at the latest There are no end of contract indemnities

28 Contrat Unique d'insertion Nature of the subsidy: 47% of gross SMIC per worked hour (with a limit of 35 hours per week). Subside delivered monthly. ''Fillon contribution relief''. More information: Law number of the 1st of December Articles L L of the Code du Travail (French work regulations) 28

29 Loans & 1 - Salary Advance = an interested free loan (Avance exceptionelle) Advances An advanced payment of salary that has not been earned yet The amount advanced may not exceed the monthly salary and can be considered as an interest-free loan It is paid back over one or more months over a schedule of repayments (= Payback period) According to regulations, the deduction for reimbursement of a salary advance is limited to a maximum of 10 percent of the net salary each month In the case of departure, the 10 percent limitation is applied to the notice allowance (indemnité compensatrice de congés payés) and vacation allowance (indemnité compensatrice de congés payés), but is not applied to the severance pay and to all the elements that are damages (dommages et intérêts)

30 Loans & Advances 2 - Advance on Salary = to be paid each 15 days Variable deposit on the 15th of the month A partial payment for work already done, which is paid in advance of the advance payment run for the pay period The amount advanced cannot be more than the amount earned When a payee receives an advance on salary, he receives an amount before the payroll payment

31 Loans & Advances 2 - Advance on Salary = to be paid each 15 days The system then should reduce the payee s next payslip by the amount already paid in advance The law or collective agreement defines the rules that give the entitlement for a payee to have an advance on salary It s up to the employer to manage those entitlements This will be in a special Payroll run, it will occur each month

32 Loans & Advances 3 Salary advance for expenses (Avance initiale permanente sur frais) Similar to a salary advance, except that the payee repays the entire amount all at once For example, many payees repay this amount when they leave the company The balance of a salary advance for expenses is recovered automatically when the payee leaves the organisation However, it should be possible to recover this advance prior to departure

33 Final Settlement

34 Voluntary Separation Ref : Code Du Travail (Labor Code) In order to resign from the company the employee must submit a Resignation Letter The Resignation Letter is sent to the company with proof of receipt If the employee wishes to reduce their notice period defined in the CBAs they must request this in the Resignation Letter before the separation is initiated as they are not paid for the difference between the requested and original notice period

35 Voluntary Separation The employer confirms acceptance of the resignation and separation date by sending a signed Acceptance of Separation Letter to the Employee In this letter HR will either accept or reject the reduction in notice period Upon separation, the employee s final pay is subject to the additional Deductions / Allowances / Entitlements as required by law When an Employee separates after completion of a Fixed Term Contract, he is entitled to a Precarity Indemnity which is equal to 10% of his Gross Salary for the entirety of the contract

36 Wage Attachment

37 Garnishment Types When a payee owes money to a third-party for alimony, tax debts, or other obligations, the employer may be required to deduct part of what is owed before the payee receives payment The deduction, known as a garnishment, is taken every month, according to national guidelines The size of the deduction depends on the payee s earnings and the number of dependents There are two types of garnishments: alimony and other debts

38 Garnishment Types Alimony deductions take priority over other debts when a payee s earnings are not sufficient to cover multiple garnishments Other debts fall into the following three categories, which are listed in the order of priority: Tax debts Penal sentences Ordinary debts

39 Garnishments Attachable and Unattachable Earnings An attachable amount of a payee s income is the part that may be garnished A payee s earnings may be split into three amounts: Obligatory attachable amount The obligatory attachable amount includes severance allowance, retirement pay over the taxable limit, and a profit-sharing allowance These amounts are completely attachable

40 Obligatory unattachable amount The obligatory unattachable amount consists of reimbursements of professional expenses (not including creditors), family allowances paid by the employer (not including creditors), and the RMI (legal minimum subsistence wage), which the government sets annually If there is not enough money to pay alimony from the attachable portion of the salary, it may be taken from the unattachable amount, provided the payee s salary doesn t fall below the RMI Only alimony payments may be taken from this portion of the salary Attachable amount Garnishments

41 Garnishments We can receive a wage attachment document from the 3 kind of originators (tresor public, organisme HLM, court of first instance) Wage attachments can be deducted from the attachable amount of employee salary, as well as the obligatory attachable amount, which includes severance allowance, retirement pay over the taxable limit and a profit-sharing allowance

42 Garnishments The obligatory un-attachable amount consists of reimbursements of professional expenses (excluding creditors), family allowances paid by the employer (excluding creditors), and the RMI (legal minimum subsistence wage), which the government sets annually If there is not enough money to pay alimony from the attachable portion of the salary, it may be taken from the un-attachable amount, provided the employee s salary doesn t fall below the RMI

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