Measures to provide relief for employees in France
(1) Overtime can be paid out exempt from tax and social security charges up to an annual net amount of €7,500 per employee.
(2) Since the implementation of the shorter 35-hour working week, which is referred to in French as réduction du temps de travail (RTT), companies that still organise the work around 8-hour days may, if requested to do so by an employee, pay overtime in lieu of time off to compensate for the extra hours or days (‘RTT’ hours or days). Now, up to 2025, at least 8 to 11 days per year of overtime, based on a calculation factor of 1.25, together with ‘genuine’ overtime may be paid out largely exempt from tax and social security charges.
(3) New incentives have been created for the introduction of the profit-sharing schemes called participation and intéressement. If the amounts are capitalised for five years and kept in a so-called company savings plan account (plan d`epargne enterprise, PEE) they will remain exempt from tax and social security charges. In the past, only around half of employees made use of these tax advantages. The new provisions include a simplification for the introduction of a scheme and the elimination of a flat-rate charge for social security contributions for small companies.
(4) In 2022, employees have the option to withdraw up to €10,000 of their savings from the PEE account before the end of the 5-year period.
(5) The value-sharing bonus (prime de partage de la valeur, PPV) was raised up to €6,000 per year and per employee. This value-sharing bonus is largely exempt from social security charges and income tax. Employers can decide to pay this bonus without any negotiations with the works council and the amount can be staggered for each employee according to different criteria. Although, the bonus has to be paid to all of the employees in the groups concerned.
(6) On 1.9.2022, the amount that is exempt from social security contributions for meals for employees during working hours was increased to €5.92 per meal.
(7) Subsidies for public transport season tickets, electromobility and fuel that are exempt from social security contributions have been increased considerably and made more flexible. These measures will initially apply in 2022 and 2023.
(8) Furthermore, all French citizens can benefit from the cap on electricity and gas prices and from the temporary reduction in the taxes included in petrol and diesel prices.