PURCHASING POWER LAWS - THE NEW RANGE OF MEASURES FOR COMPANIES

VALUE SHARING PREMIUM

Since July 1, 2022, the Exceptional Purchasing Power Bonus (“PEPA” in French) implemented since 2019, has been replaced by the Value Sharing Bonus (PPV).

The mechanism for this payment can be determined either by collective agreement or by unilateral decision of the employer. It is exempt from social security contributions up to a limit of 3,000 euros per beneficiary per calendar year and up to 6,000 euros for companies with an a profit-sharing scheme existing at the date of payment of the premium. This bonus can be paid retroactively from July 1, 2022, in one or more instalments, with a maximum of one payment per quarter.

The bonus comes in addition to the usual remuneration and can never replace it, nor can it substitute for increases in remuneration or premiums provided for by a wage collective agreement, by the employment contract or by the practices in force in the company, the establishment or the department. Several criteria are likely to cause the amount to vary depending on the beneficiaries, such as salary, classification level or seniority in the company.

EXEMPTION OF SOCIAL CONTRIBUTIONS FOR OVERTIME, MEAL VOUCHERS AND MEAL EXPENSES

Increase in the exemption ceiling for overtime

The exemption ceiling for overtime has been raised from 5,000 to 7,500 euros.

This new ceiling applies to remuneration paid for overtime and complementary hours worked from January 1, 2022.

Reduction of employer contributions on overtime

A reduction in employer's contributions has been introduced for companies with between 20 and 249 employees for all overtime hours worked from 1 October 2022.

Increase in the daily limit for meal vouchers

In order to support purchasing power, meal vouchers can be used until December 31, 2023, for the purchase of any food product, whether or not it is directly consumable. In addition, the daily limit for using meal vouchers has been increased from 19 euros to 25 euros.

MONETIZATION OF COMPENSATORY DAYS OFF WORK (“RTT”)

The legislation on purchasing power allows companies, in consultation with employees, to buy back the RTT that employees give up.

Regardless of the size of the company, employees may, at their request and with the agreement of the employer, waive all or part of the days or half-days of rest earned in respect of periods after January 1, 2022 and up to December 31, 2025, pursuant to a collective agreement or collective bargaining agreement instituting a system of reduced working hours.

The days or half-days worked following the acceptance of this request will give rise to an increase in salary at least equal to the rate of increase for the first hour of overtime applicable in the company, without being charged to the legal or conventional overtime quota.

EMPLOYEE SAVINGS

Easing of the implementation of profit-sharing agreements

Companies with fewer than 50 employees that are not covered by an approved industry-wide profit-sharing agreement may set up a profit-sharing scheme by means of a unilateral decision, in the event that negotiations fail and there is a legitimate lack of employee representative bodies. The maximum duration of this type of agreement has been extended from three to five years.

The tacit renewal of the profit-sharing agreement for a period equal to the initial term of the agreement may now take place several times, as opposed to only once previously.

Companies will also be able to draft a profit-sharing agreement by electronic means on the "mon-interessement.urssaf.fr" website in order to check its compliance beforehand. These "pre-validated" agreements will be deemed compliant for tax and social security purposes as soon as they are filed.

Paternity leave is treated as time worked for the calculation of profit-sharing

Paternity and childcare leave have been added to the list of employee absences that are treated as time worked, when the profit-sharing agreement provides for the distribution of sums in whole or in part on the basis of time worked (article L 3314-5 amended of the French Labor Code).

Exceptional release of employee savings

Until December 31, 2022, beneficiaries of an employee savings plan may request the release of all or part of the securities, shares or sums held under a profit-sharing or incentive agreement to finance the purchase of goods or the provision of services. This release can only be done once and the amounts paid to the beneficiary cannot exceed 10,000 euros net of social security deductions.