benefits in france

Social coverage in France is very largely made up of contributions to funds which are fixed by law or by the collective bargaining agreement and are thus the same for all companies in the same area of activity.

Consequently, unlike in many other countries, employees do not normally try to negotiate these statutory benefits during the hiring phase.  (They are more likely to focus on base salary, variable compensation and other ‘side’ benefits such as cars, phones, etc).

5 components to compulsory coverage in FR

Social Security (URSSAF)

In a nutshell, social security in France covers the following areas:

  • Healthcare costs : generally refunds patients around 50-70% of most healthcare costs, or 100% in the case of costly or long-term illness.  Medical costs are managed by local centers called CPAMs (Centres Primaire d’Assurance Maladie – www.ameli.fr).
  • Maternity and sick leave : sick leave is paid from day 4 onwards and is capped at 44.34€ gross/day, while paternity leave (11 calendar days) and maternity leave (16 weeks) are capped at 86€/day.
  • Disability insurance : compensates for loss of income if the ability to work is impacted. Amount of indemnity depends on level on disability.
  • Basic pension fund paid from age 62 (sometimes earlier if born before 1951), and also paid to surviving spouse upon death (60% of pension amount).
  • Life insurance : approximately 3 months of salary (capped at 9 933 € in 2018) paid out to heirs of deceased employee.
  • Work accidents : benefits for work-related injury or sickness (100% reimbursement of medical costs and better sick leave pay than for ‘normal’ sickness).
  • Family benefits include assistance with childcare costs and the costs incurred with a new birth (PAJE : infant accommodation benefit)
  • Housing benefits paid out to support social housing and housing aid for low-income households.

Spouses and dependent children of an employee or retired person are also covered if they reside in France.

There is the same level of coverage whatever the level of salary for healthcare costs.  For the other benefits, the level of coverage is proportional to salary, but capped.

For an extensive explanation of your employees’ rights in France, please visit the CLEISS website.

Unemployment benefits (Pole Emploi)

This covers loss of employment (except in the case of resignation) and benefits are proportional to salary.

In general, if an employee is made redundant, or concludes an amicable termination agreement with his employer, he/she will get 57 % of average gross salary as unemployment benefits for up to 2 years (or 3 years if over 55 years old).

Please read the European Commission’s documentation on unemployment benefits in France, in English, for more details.

The ‘Pole Emploi’ also provides a wide variety of programs and financial aid for employees creating a business, training, etc.

Pension plans (funds vary according to activity branch)

These are additional pension funds, on top of the basic pension provided by the Social Security.  The contribution rules are set by law, are identical for all employers and are proportional to salary and employee ‘status’.

Pension funds are managed by organisations, usually private insurance organisations, which are designated according to a complex system which depends on the activity branch of the company, collective bargaining agreement, geographic area etc.

The contributions are split into two types, with different rates applicable :

  • ARRCO for all non-cadre employees (whatever their salary) and for all cadre (executive) employees (for the first 3 311 € */ month of their salary)
  • AGIRC for all cadre employees for the part of the salary over 3311€*/year

More information is available in French here on the official website, or in English here on the European Commission website.

* for 2018

Life & disability coverage (‘Prévoyance’)

Covers death, prolonged sick leave and disability risks.

Contrary to URSSAF, Pole Emploi and Pension funds, the rates are not determined by law, but by branch, through the collective bargaining agreement applicable to your activity branch.

The rates (and consequently the coverage) are also a minimum and the employer can choose to cover more.
The only legal minimum applicable to all employers is that for cadre (management-level) employees. Contributions are a 1.5% rate on the first bracket of their salary (up to SS limit – 3 311 € in 2018), for minimum death capital coverage.

Health coverage (or ‘Mutuelle’) (funds vary according to branch)

Covers part of the difference between the actual healthcare costs and those covered by the Social Security – which already covers approx. 100% of all ‘serious’ healthcare costs and around 70% of’everyday’ healthcare costs. This is provided by private insurers with a variety of coverage levels/rates.This is compulsory coverage, with rates (fixed amount per month) and levels of coverage, determined by law and collective bargaining agreements.

As of 2016, it has become compulsory for employers to provide a private health insurance to complement the healthcare reimbursements of French Social Security.

Contrary to URSSAF, Pole Emploi and Pension funds, the rates are not determined by law, but by branch, through the collective bargaining agreement applicable to your activity branch.

In our Neteem PEO package

Under the SYNTEC collective bargaining agreement (applicable for all consulting companies), the default designated insurer is Malakoff Mederic (same as for life & disability)

As of January 1st 2016, Neteem provides the level of coverage set by the collective bargaining agreement. Due to the volume effect of this new compulsory benefit (Malakoff Mederic covers virtually all the Syntec branch companies), the cost is relatively low for the level of coverage it provides (47€/month in 2017 for coverage of employee and children, split 50/50 between employee and employer)

The children of the employee are automatically covered for that cost.
The employee can choose to register his spouse or partner as well and can also choose higher levels of coverage if need be, however the extra cost of these will be his sole responsibility (up to 77 €/month for option 2 coverage & spouse extension). The collection of the contributions for the options will go through payroll however, taken out of their net pay.

It is compulsory coverage, and thus must be proposed to any new employee.
However, there are a few cases when the employee can refuse the coverage (e.g. if they were in the company before 1/1/16, or if they are already covered by their spouse’s compulsory coverage and produce proof of this yearly, or if they are on a less than 12 mos. contract and don’t wish Neteem’s contract etc.)

Details of the levels of coverage and options/costs available can be downloaded here.

NB. France is considered to provide one of the best overall health care systems in the world, which is already covered by Social Security benefits. For example, if you are hospitalized or have a long-term ailment and are treated in one of the very good public hospitals or with a physician (widespread) who applies Social Security recommended rates, there will in fact be no cost left for a private healthcare plan to pick up.
This new benefit will mainly serve for the bits that are not so well reimbursed by Social Security (e.g. eye-wear / dental care / « everyday »/comfort medicine – e.g. for colds etc, for which reimbursement is not 100% – and extra costs above Social Security rates in private clinics, with physicians who go over SS rates)
This is why a private healthcare plan – despite being an additional cost – is not really expensive, the employer cost is only +23.50€/month in 2018.