Can the employer give free lunches to his employees?

Can the employer give free lunches to his employees?

Yes, the employer can provide free meals to the employee (or pay the meal directly).

In this case the meal is considered being worth the legal lump sum of €4.8 per meal (aka €9.6 per days for 2 meals).

However, this lump sum per meal is not exempted from social contributions.

Social security (URSSAF) considers it as a benefit in kind. Therefore, the basis of the social contributions must be increased by the number of meals paid to the employee time €4.8.

You can find the URSSAF explanation here:

https://www.urssaf.fr/portail/home/employeur/calculer-les-cotisations/les-elements-a-prendre-en-compte/les-avantages-en-nature/lavantage-en-nature-nourriture/lemployeur-fournit-gratuitement.html

Also, be extra careful. As the collective bargaining agreement can state a higher amount per lunch, you may have to pay much more than just contributions to €4.8 per lunch.

If the employee pays part of the meal, the employer part can be exempted from social contributions. However, to do so, the employee contributions must be at least 50% of the lump sum.

Here is the text from the URSSAF :

https://www.urssaf.fr/portail/home/employeur/calculer-les-cotisations/les-elements-a-prendre-en-compte/les-avantages-en-nature/lavantage-en-nature-nourriture/lemployeur-fournit-le-repas-a-pr.html

One other option is to provide lunch vouchers to the employee. This process is very common in France and well thought of.

Don’t hesitate to contact French Payroll Expert if you have any question on setting up lunch vouchers.

The new 2018 legal social contributions rates.

As of January 2018 social contributions rates changed.

The employee CSG contribution increased from 7.5% to 9.2%.

The Issurance for sickness, maternity, invalidity, death 0.75% employee contribution has been canceled.

And the Unemployment employee contribution has been reduced from 4% to 0.95%

Here are the new rates:

Benefit Global rate %Employer %Employee %Base
I. URSSAF (social security)
Assurance for sickness, maternity, invalidity, death) (1)13.0013.00Total gross salary
Solidarity for autonomy0.30.3
Family allocation (2)5.255.25
Retirement2.31.900.40
Housing help (at least 20 employees)0.50.5
Union funding0.0160.016
Work related accidentVariable rate based on the company’s activity
CSG9.29.298,25% of the total gross salary (3)
CRDS0.50.5
Retirement   15.458.56.9Salary limited to 1 social security ceiling
Housing help (less than 20 employees)0.10.1
Unemployment (4) (5)54.050.95Salary limited to 4 social security ceiling
AGS0.150.15
II. Complementary retirement (ARRCO & AGIRC)
Executives offciersArrco TA7.754.653.1Salary limited to 1 social security ceiling
Minimum mandatory life insurance1.51.5
AGFF TA21.20.8
Agirc TB20.5512.757.8Salary between 1 and 4 social security ceiling
AGFF TB2.21.30.9
Apec0.060.0360.024Salary limited to 4 social security ceiling
AGFF TC2.21.30.9
Agirc TC20.5512.757.8Salary between 4 and 8 social security ceiling
CET0.350.220.13Salary up to 8 social security ceiling
Non-executives officersArrco T17.754.653.1Salary limited to 1social security ceiling
AGFF T121.20.8
Arrco T220.2512.158.1Salary between 1 and 3 social security ceiling
AGFF T22.21.30.9
III. Taxes & others
Taxe on salary (6)4.254.25Total gross salary
Construction (at least 20 employees)0.450.45
Apprentice0.680.68
Professional training (at least 10 employees)11
Professional training (less than 10 employees)0.550.55

What payroll changes in 2017

As always, with the news come a few changes. Here are the ones related to the payroll.

Minimum wage increase

Avery year the minimum hourly wage (SMIC in French) is updated. With the presidential election in 2017 we expected the government to increase the SMIC at a higher rate than the inflation. We were happily disappointed.

The minimum hourly wage will increase of 0.93% on the 1st of January 2017 putting it at 9,76€ (it was 9,67€ in 2016).

For a full-time employee (35 hours per week) the monthly gross salary will then be of 1480€. The net will be of 1153€.

Visit our database for more information about the SMIC: http://www.frenchpayrollexpert.fr/database/minimum-wage-smic/

Social security ceiling increase

In the same way than the minimum wage salary the social security ceiling increases every year. In 2017 it will be of:

  • 39 228€ for a year (38 616€ in 2016)
  • 3 269€ for a month (3 218€ in 2016)
  • 180€ per day (177€ in 2016)
  • 24€ per hour (identical in 2016)

Some contribution rate increases when the employee’s salary exceeds the social security ceiling. Other contributions are limited to the social security ceiling. All in all, this increase is of a limited impact for most people.

Visit our database for more information about the social security ceiling: http://www.frenchpayrollexpert.fr/database/social-security-ceiling/

Retirement contribution increase

The retirement contribution paid to the URSSAF (social security) on the whole salary (not limited to the social security ceiling) will increase on the 1st of January. It will be of:

  • 0,40% for the employee contribution (0,35% in 2016)
  • 1,90% for the employer contribution (1,85% in 2016)

Transport contribution increase

Part of the public transportation program is financed by the payment of the transport contribution. This contribution is paid by companies employing at least 11 people. This contribution is paid on the whole salary. It’s rate will depend on the region were you company’s establishment is located.

In Paris the contributions rate will increase from 2,85% to 2,95% on the 1st of January.

You can find you contribution rate on this web site: https://www.urssaf.fr/portail/home/taux-et-baremes/versement-transport.html

Unemployment contribution decrease

The AGS is one of the unemployment contribution paid by the employer. In 2016 its rate was of 0,25% of the salary limited to 4 time de social security ceiling.

In 2017 this rate will decrease to 0,20%.

DSN

The DSN (“Déclaration Sociale Nominative” in French) is a global change in the declaration format.

This means that as of the 1st of January 2017, every payroll provider (in house, service provider or accountant) must provide the authorities with one (and only one) declaration.

This declaration will contain all the information about the month payroll.

The information will then be dispatch to all the social bodies to which the company is registered.

This system will replace all the monthly, quarterly and yearly declarations.

For the company, it will not change a thing. The rate will be the same and the payment schedule will be the same.

However, once a DSN is sent (and accepted) the company cannot modify it. This means that you cannot go back on a payroll.

We advise that you make sure you send a formal OK to your provider before he sent the DSN.

Also, every sick leave will be declared with the DSN. However, it must be done within 5 days after the employer has been informed of the leave. The sick leave information can no longer be provided to your service provider with the monthly payroll data.

The DSN is a big step to simplify the payroll process. However, we will all need to adapt and change our process and time line. We recommend you contact your payroll provider to setup this new process.

 

Somme other change for the year 2017 are note related to the payroll. Here are a few of them:

Stamp price increase

The price the stamp will increase in 2017. For a normal letter, it will go from 0,80€ to 0,85€.

Cigarette neutral packaging

The neutral packaging for cigarettes will now be mandatory.

Traffic offense

When a traffic offense is committed by a company car, the employer will now have to obligation to inform the authorities of who was driving the car when the offense took place.


Sources:

Public services: https://www.service-public.fr/particuliers/actualites/A11229?xtor=RSS-111

TISSOT editions: http://www.editions-tissot.fr/actualite/droit-du-travail-article.aspx?secteur=PME&id_art=8077&titre=Cotisation+d%E2%80%99assurance+vieillesse+2017


French Payroll Expert