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France

Government support for business and workers in France

Table of contents
  1.  What government schemes(s) are available in your country to help employers and workers in the current COVID-19 crisis and for how long?
  2. What payments are made under the scheme(s) and how/by whom?
  3. Which employers and employees are covered?
  4. What procedure(s) does an employer have to follow to be able to take advantage of the scheme(s)?
  5. Are there any other important eligibility criteria?
  6. Are employees covered by the scheme(s) protected from dismissal?
France

1. What government schemes(s) are available in your country to help employers and workers in the current COVID-19 crisis and for how long?

If your company faces “exceptional circumstances”, such as the current pandemic, leading to a decrease in activity or even to a temporary closure, you can ask for a special indemnification from the state to cover the costs of unworked hours.

The maximum duration was usually six months and 1,000 hours/employee by year. In the context of COVID-19, this has been increased to 12 months and 1,607 hours/employee by year.

2. What payments are made under the scheme(s) and how/by whom?

The employer must maintain at least 70% of the employee’s compensation. This is paid directly by the employer to the employee. Some collective bargaining agreements provide for a higher percentage. In turn, the employer must claim to the French government for indemnification.

The indemnification of the employer by the government is capped at a maximum of 70% of the cost with a limit of 4.5 times the statutory minimum hourly wage ("SMIC") which means an indemnification by the French government of approx. 4.850 EUR max per employee.

For example, your employees work 35 hours a week, but you must reduce this by 50% because of the losses of contracts due to COVID-19:

  • 35/2 = 17.5 hours will not be worked and 17.5 will be worked.
  • You must pay your employees 17.5 hours normally and 17.5 hours x 70% minimum (the “unworked hours”). For the unworked hours, you will receive an indemnification from the state, which is almost free of social security contributions (only CSG and CRDS levies apply).

3. Which employers and employees are covered?

Until now, short-time work did not cover certain categories of employees, such as employees having their working time computed in terms of days or regulated sales representatives. However, this system has now been extended to them. All employers are covered, even foreign employers with no legal entity registered in France, as long as the employees are governed by French law and contribute to French social security.

4. What procedure(s) does an employer have to follow to be able to take advantage of the scheme(s)?

In our scheme, the process is as follows:

  • inform and consult with the works council;
  • file the form on the dedicated platform (agreement within 48 hours);
  • the employer pays the employees; and
  • the employer requests indemnification. The French Government specifies that companies may decide not to ask for the payment of the short-time work allowance from the Administration.

5. Are there any other important eligibility criteria?

The application for short-time work must be completed by the employer on a dedicated website before 30 April 2020.

When completing the application, the employer must provide specific information relating to the company, in particular the reasons justifying the implementation of short-time work. To do so, it is important to clearly specify the consequences of the pandemic on the company’s activity. The employer can provide any supporting documents with the application.

Furthermore, the employer must specify the form of short-time work applied in the company (i.e. reduction of work or suspension of activity), the measures applied to limit short-time work (e.g. allocation of days off, training), the foreseeable period of short-time work, the number of employees concerned and the maximum number of unworked hours to be compensated by the Administration.

6. Are employees covered by the scheme(s) protected from dismissal?

No protection from dismissal has been provided for employees in short-time work.