The “Career Future” law
Newsletter - September 2018
The law on the freedom to choose one’s career future was adopted on 1 August 2018. This reform, the battle cry during the presidential campaign, amends the regulations concerning vocational training and apprenticeships, and various other employment-related provisions.
The personal training account (“CPF”) is now credited in euro rather than in hours as it has been until now. Also, to finance longer training programmes in the scope of a professional transition plan, a special way of using the CPF has been introduced; the employee has the benefit of a special kind of leave when the training occurs during working hours. To take advantage of this leave, the employee must first do a career profile process to identify his/her professional experience, so that the term of the training path can be set.
The career development period is replaced by retraining or “on-the-job” promotion, which must enable the employee to shift specialties or take advantage of a promotion by means of training actions.
Unlike what was announced, the financing of the vocational training is little changed, and the rates and bases of the contribution to vocational training and of the training levy remain unchanged.
In-class and on-the-job training
The new law relaxes the rules pertaining to apprenticeships, making them possible for people up to the age of 29. The employer is now able, in certain cases, to dismiss the apprentice, and the apprentice is able to resign according to certain conditions. The term of the career development contract is raised to three (3) years. It is to be noted that the contract may now be partially performed abroad.
To remedy the wage differences between men and women, companies with more than 50 employees are required to check whether there are pay gaps between men and women. If so, they are responsible for negotiating or setting up catch-up measures within three (3) years or face penalties.
The obligation to hire disabled workers is simplified. All employers will be required to declare the numbers of disabled workers they employee starting on 1 January 2020. At that same date, the annual contribution will no longer be paid to AGEFIPH, but directly to URSSAF. As a reminder, only employers with at least 20 employees are subject to the obligation to employ disabled workers. Employers will declare their situation with regard to the obligation to hire which they must follow by using the named corporate declaration (“DSN”)
The employee’s contribution is scheduled to disappear as at 1 January 2019 as per the Law on financing social security for 2018, while for the last quarter of 2018, it is ACOSS that will be responsible for paying the contribution to URSSAF. However, some exceptions remain: this is the case for expatriated workers who are members of the unemployment insurance, certain seasonal workers in show business, and companies located in Monaco.
Furthermore, employers and employee groups are expected to be able to take advantage of new arrangements enabling them to directly influence the total employer’s contribution, via a merit rating mechanism, according to three criteria:
– the company’s industrial sector,
– the number of contract terminations (not including resignations) that lead to employees being included on the job seeker list (e.g., contractual termination),
– the number of terminations of “lending” contracts between the user company and a temporary staffing company.
Last, employees who resign and independent workers shall, in some cases, be eligible for unemployment insurance benefits.
Prevention of illegal working
To find infringements pertaining to illegal working, the labour inspectorate may show up at a company’s premises and obtain a copy immediately of documents providing evidence that the employer is adhering to its disclosure responsibilities. The law enhances the investigation powers by entitling the labour inspectorate to obtain computerised data and media from companies and by broadening this right to documents held by third parties when conducting inspections.
This right to obtain documents is expected to make it easier for the labour inspectorate to conduct programmes aimed at preventing fraud. This practice is used by some companies, which employ strategies such as seconding employees to elude the social security contributions and their taxes, even though they carry out a stable, regular and ongoing business in France. The labour inspectorate may now use as a basis a bundle of indices, which can be gather from third parties (suppliers, clients, etc.), to identify and dismantle arrangements set up by fraudulent companies.
We are entirely available if you have any further queries about the issues discussed in this newsletter or about any other accounting, tax, social security or law related topic.