BRINGING ON THE UNEMPLOYED

In France, social costs (the charges and taxes levied on salaries) can be as much as take-home pay. One way to keep these costs down is to take advantages of several schemes offered by the government. There are tax breaks for hiring one’s first employee but how else can a small business keep initial social costs down? Taking on a long-term “chomeur” (unemployed person) is one way.

The rules for employing a long term "chomeur"

• You haven’t fired anyone for economic reasons for 12 months prior

• The candidate must have been officially declared as “chomeur” for at least 12 months

• The position can be part or full-time on a temporary (CDD) or permanent (CDI) work contract as long as you hire the person for at least 12 months (but no longer than 18 months on a CDD).

A fixed subsidy corresponding to a percentage of the initial salary:

• 40% of the salary for the first year of a CDI or for the first third of a CDD

• 30% of the salary for the second year of a CDI or for the second third of a "Talking Business:Work Contracts" from Riviera Reporter N°91, June/July 2002

• 20% of the salary for the third year of a CDI or for the last third of a CDD

The effective ceiling of the subsidy is the amount of state unemployment insurance he or she was receiving at the time of hiring and limited to the amount of time left on his period of unemployment compensation.

The subsidy can only be obtained by submitting an offer of employment to the ANPE (Jobs Centre) who then propose candidates fitting the job description. If a suitable candidate is found, the employer returns his request for the subsidy to the ANPE who pass it on to ASSEDIC. To actually get the subsidy, the employer must submit a copy of the work contract to the ASSEDIC who will advise the employer within 5 days of exactly how much he can expect to receive in monthly payments. Every month the employer must send the ASSEDIC a form attesting to the fact that the employee is still working for the business.

As usual, it’s all rather bureaucratic (welcome to France!) but can mean considerable savings at a time when a business needs it most.

© Mike Meade 

From Reporter 91 - June/July 2002

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