Short-time working allows the employer to reduce its employees’ working hours or temporarily close all or part of its establishment in order to allow employment to be maintained and to partially compensate the loss of remuneration suffered by employees as a result of hours not worked. In view of the economic consequences of the spread of the Covid-19 epidemic, a decree dated 25 march 2020 and an Ordinance dated 27 march 2020 provide for favouring and facilitating recourse to short-time working.
Which companies may make use of short-time working?
The employer may put its employees on short-time working if the company is forced to reduce or temporarily suspend its business for one of the following reasons: the economic climate; difficulties in procuring raw materials or energy; severe damage or weather-related damage of an exceptional nature; the transformation, restructuring or modernising of the company; any other circumstance of an exceptional nature.
According to the Labour Ministry, the Covid-19 epidemic constitutes a circumstance likely to justify recourse to short-time working.
The Labour Ministry specifies in particular that it is possible to have recourse to it in the following cases:
- administrative closure of an establishment;
- prohibition of public gatherings following an administrative decision;
- massive absence of employees essential to the company’s business;
- temporary interruption of non-essential activities;
- suspension of public transport by administrative decision;
- drop in business due to the epidemic.
It seems that companies may not anticipate their request and that it must be demonstrated:
- either that it is concerned by the closure obligation provided for by the government decree of 23 March 2020;
- or that it cannot pursue its business normally due to the impossibility of using teleworking, the impossibility of complying with the distancing measures or a massive absence of its employees essential to the continuation of its business.
How to make a short-time working request in practice?
The employer sends a short-time working request to the Prefect of the department in which the establishment concerned is located or, if the request concerns several establishments of the same company, to the Prefect of one single department (FAQ of 29 March 2020, which can be downloaded from the site: https://travail-emploi.gouv.fr/IMG/pdf/covid19-doc-precisions-activite-partielle.pdf)..
- What information must be provided?
The request specifies the reasons justifying the recourse, the predictable period of under-activity and the number of employees concerned. The request is accompanied by the opinion of the social and economic committee (CSE) if it has been given or, failing this, indicates the scheduled date of consulting the CSE; in the latter case the opinion must be sent within a maximum period of two months from the request.
The authorisation request is made in dematerialised form on the site: https://activitepartielle.emploi.gouv.fr/aparts/, or by any other means providing a certain date.
The employer has a period of 30 days from the placing of its employees on short-time working to send its request.
- Within what period does the employer receive its reply?
The Direccte has two calendar days to give its decision. Should no reply be received within this period, the authorisation is granted tacitly. The employer informs the CSE (social and economic committee) and the employees of the favourable or unfavourable decision to place the establishment on short-time working.
Are all the employees eligible for the short-time working mechanism?
All the company’s employees (permanent staff, staff on fixed-term contracts, temporary staff) are, in principle, entitled to benefit from the short-time working indemnification.
The decree dated 25 march 2020 extends the benefit of short-time working to employees working under a regime of a set number of hours or days worked, including if there is no total closure of the establishment, i.e. even in the event of a reduction in the working duration.
To what indemnisation does short-time working entitles?
In exchange for the administrative authorisation to have recourse to short-time working, the employer must:
- pay the employees for the hours normally worked in the event of a reduction in the working duration;
- pay the employees an hourly indemnity corresponding to 70% of the gross remuneration used as the basis for the paid leave indemnity, i.e. 84% of the net remuneration, for unworked hours providing an entitlement to the payment of this indemnity (i.e. up to 35 hours) ;
- pay, where applicable, to the employees on short-time working whose remuneration is , in a given month, less than the guaranteed minimum growth salary (SMIC), additional remuneration at least equal to the net SMIC (€8.03) on the basis of 35 hours (compliance with the minimum monthly remuneration or RMM);
- pay the short-time working indemnity on the normal payday.
Example: for an employee whose working hours are 35 per week who receives a gross monthly salary of €2,024.80 and whose number of unworked hours that can be indemnified under short-time working is 30 hours in the month.
Employee’s hourly remuneration rate: 2,024.80/151.67 = €13.35
Maximum amount of the hourly rate of the short-time working allocation: 70% × €13.35 = €9.35 (< 70% x 4.5 x €10.15 government indemnification ceiling).
The employee receives for 121.67 hours worked: 121.67 x €13.35 = €1,624.29
The employee receives for 30 hours of short-time working: 30 × €9.35 = €280.50
The employer is reimbursed by the government: €280.50
Remains payable by the employer: € 0
This indemnity is not subject to payroll and employer social security taxes, nor to the corporate contribution (forfait social). It is, however, subject to the CSG tax at the rate of 6.20% and to the CRDS tax at the rate of 0.50%. These two contributions are calculated on the basis of 98.25% of the indemnity paid (application of a deduction of 1.75% for professional expenses). Under these conditions, the employee will receive remuneration representing 84% of their net salary.
How does the employer obtain the short-time working allocation?
The employer receives a short-time working allocation funded jointly by the government and the unemployment insurance administrative body (Unédic). The short-time working hourly rate is equal to 70% of the hourly remuneration limited to 4.5 times the guaranteed minimum growth salary (SMIC). This hourly rate may not be less than 8.03 euros (Labour Code, art. D. 5122-13 amended by the decree).
The employer sends, within a period of one year following the end of the period covered by the short-time working authorisation, an indemnisation request accompanied by the supporting documents (the employees’ payslips mentioning the number of unworked hours) on the site https://activitepartielle.emploi.gouv.fr/aparts/.
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