Employee benefits in France

Benefits

1. Healthcare / Private Medical Insurance

The French government refunds patients 70% of most health care costs, and 100% in case of “ALD” conditions (long term medical problems such as cancer and diabetes).

Every worker is entitled to access an additional, company subsidised plan, These are managed by non-profit mutuelles, and employers must pay at least 50% of the cost of these.  Mutuelles can cover various out-of-pocket expenses, including co-payments, dental care, vision care, prescription medications, and other services not fully reimbursed by the statutory system.

It’s worth noting that mutuelle health insurers are bound by a non-discriminatory code of practice, and they cannot refuse health coverage or charge extra premiums based on health conditions or to perceived high-risk individuals.

Mutuelle costs are dependent on the type of policy you take out and costs vary according to income, age, chosen level of cover, status as employee/self-employed, and living situation. Many employers chose to fully cover the cost of mutuelles and even family plans (above the 50% requirement). The market standard coverage includes dependents, but excludes unemployed partners. We’ve seen this cost our employers an average of €50 pp/pm (excluding spouse) with about €30 additional per child. 

Some popular mutuelle providers include:

• Alan
• AXA Santé
• MGEN (Mutuelle Générale de l'Éducation Nationale)
• MAAF Santé
• Harmonie Mutuelle
• MACIF Santé

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Click here to view our catalogue on private medical insurance providers in France.

2. Life Insurance, Income Protection & Disability

Sécurité sociale supports families in the event of the death or accident of a spouse. In the event that an employee can no longer work, they receive a daily allowance. There is also a mandatory payout of 13% of base income for disability, critical illness and to survivors of a deceased employee. However, 80+% of employers offer additional support in the form of assurance décès. And 70+% of employers offer further accidental death and dismemberment (AD&D), long and short-term disability insurance (assurance prévoyance). 

For supplemental coverage, the employee and employer contributions are both typically 1% of employee base salary, and the payout range is 2x - 3x salary, with an additional 0.85x per dependent child. If the employer is including assurance prévoyance, it is included in this contribution. 

While companies are not required unilaterally to take out prévoyance, there are collective agreements by which it is compulsory to offer this type of insurance for employees of a sector of activity or a professional branch.

Employers have the obligation to pay a death in service benefit to executives (Cadres). In addition, a death allowance may be paid by the National Sickness Insurance Fund (CNAMTS)

Leading providers in assurance décès and prévoyance include:

• Axa France
• MMA
• Allianz
• MACIF

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Click here to view our catalogue on insurances in France.

3. Retirement

The retirement scheme in France is complex and in some ways politically contentious. It is also considered one of the strongest in the world, and private pensions are not considered essential in the way they are in the UK and the US, for example (in the UK, state pensions equate just 28% of a person’s salary at the time of retirement, while France boasts an average of 74%). That said, it is very common for employers to offer an additional workplace pension scheme. 

France’s state pension or l’Assurance Retraite is compulsory, meaning that all workers, whether employed or self-employed, must pay contributions to a pension fund. The French pension scheme is made up of two parts, both of which are compulsory and set by the state (i.e. you cannot opt out of either scheme, or choose the type of  complementary regime – it depends upon your profession):

• Régime de base: basic state pension
• Régime complémentaire: based on a points system, this is a complementary pension, which varies depending on the type of job you do and your salary

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The French pension system is very strong, and it is not considered necessary to pay into a private pension. However, 45+% of companies provide a defined contribution (DC) supplemental retirement benefit, for which the employer contributes 70% - 100%

• Employee contribution: 0-2%
• Employer contribution: 1.5-4%

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10+% of employers offer a defined benefit (DB) supplemental retirement benefit. This typically requires 10-15 years seniority and that the employee retires from the company. The employer pays full cost, but it is tax advantaged, and payout is life annuity at 50-65% of final salary.

For employers, there are tax advantages to funding supplementary plans

Click here to view our catalogue on insurances in France.

4. Meal Vouchers

Meal vouchers are a popular tax-advantaged benefit in France. There are 3 conditions with which the employer must comply in order to be exempted from tax contributions on the value of the vouchers:

1. The employer contribution must not exceed the indexed limit. As of May 2023 that limit is €6.91
2. The employer contribution must be 50% - 60% of the voucher value
3. An employer can only give one voucher per employee per lunch break within the daily working schedule.

5. Other tax advantaged benefits

• Assurance vie is a popular tax advantaged savings plan. This financial investment is free from French income and capital gains tax during the investment stage.

Policies

1. Annual Leave

Employees are entitled to 30 days of annual leave (jours ouvrables), accrued at a rate of 2.5 vacation days per month. Vacation days are still accumulated if a worker is on paid leave, leave to compensate for overtime, leave for family reasons, absence from work due to occupational accidents or illnesses, maternity or paternity leave, adoption leave, training leave, and military service periods.

Employment law indicates that employees should not take more than 24 days off at once, but at least 12 consecutive working days must be taken at one time.

If an employee gets sick during the holiday leave, they are not entitled to additional days. (In the UK, these days are “refundable”).

Some companies give additional vacation days to reward years of service.

2. Sick pay

Social Security covers up to 50% of an employee's daily earnings from the fourth day of illness onwards. The employer may be required to contribute, depending on the relevant provisions of the collective bargaining agreement. In some instances, the pay is as high as 90%.

There are requirements an employee must meet in order to be eligible for the first 6 months of sick pay, and another set of requirements in order to be paid for 12 months.

3. Maternity & Paternity

Maternity leave of 16 weeks is covered by social security. This includes up to 6 weeks before birth, and a minimum of 8 weeks after birth

The first 3 days of paternity leave are covered by the employer, and 25 days covered by social security. This is extended to 32 days in the case of multiple births

To be competitive in the modern workforce, many employers are choosing more equitable maternity/paternity policy.

Adoption leave length is dependent on the number of children in the household prior to adoption

Parents are entitled to additional unpaid leave at the end of the maternity and paternity leave, to be taken between 6 months and 3 years after the birth. The unpaid leave lasts for one year but can be extended until the child's third birthday and divided between both parents. The parents may take it simultaneously or alternate.

Employers may not refuse this parental leave if the employee has been with the company for at least one year before the birth of the child.