Cost of employing people

[AnOther]

Can someone advise me as to the cost to an employer of employing a person.

I'm not referring to actual salary, although presumably the size of this would have some effect on the cost of employment, I'm thinking more of the peripheral costs such as health contributions, taxes and/or other dues etc. that a French employer has to pay per employee ?

Also, how many hours a week does an employee have to work to qualify as full time ?

[LesFlamands]

Very hard to work out as bills keep arriving even months after the contract has finished. In the building industry (where paid holiday is compulsory) my accountant reckons it's about 110% of the salary. 35 hours a week is a full time contract.

[Val_2]

Not far off Charles. We used to reckon about 92% again of each month's salary for an employee plus the extras like dinners and use of a vehicle and things like paying yearly for medical,taxe apprenticesage etc.

Be very very careful when taking on employees, make sure you get the employee to sign his hours of work sheet just before submitting for a bulletin de salaire each month, the contract is water tight and that they can be trusted especially working in other folk's houses. Getting rid of in France is a minefield and without the above,you can end up paying dearly perhaps upto six months full wages for someone who isn't worth it. Sorry to whinge,but have been there many times and done all that and still have the scars to show.

[AnOther]

Crikey, I'd heard it was high but at that rate you're saying that employing someone on €20,000 pa salary actually cost's an employer €42,000.

If this is correct then it's amazing that anybody in France has a job at all [:-))]

[Val_2]

Yep its high allright and which is why so many legally registered artisans complain bitterly about those working onthe black. We worked it out recently that the last employee who took home 1044€/month after charges cost us over 32000€ per year in real terms. Obviously these huge payments are taken into account with the yearly accounts and some allowances are made but yes, employing folks here if you are a small business is a big risk and needs guidance by an accountant as to whether it is feasible or not because once you start the ball rolling it is very difficult to stop it.  We have since not taken on any employees as my husband wanted to cut down a little and we have actually turned over far more work in money terms and made decent profits than we ever did with employees.

[WJT]

Does anyone know if the current government will make it easier and cheaper for small enterprises to hire employees?

 The longer I stay here the more widespread I learn working on the black here is. I feel that Brits are much more concerned about this (including us, we wouldn't dream of it for many reasons) than the French. Just talking to our neighbours and French artisans etc.. they are making out as if we are mugs because we make such a big deal about it. Everyone does it we are told in one way or another. One neighbour asked me if I knew what the percentage an artisan must pay if all income was declared and how they could possibly declare everything? [blink]

It does appear to me at least, the government is probably losing buckets of money paid on the black.

[Will]

Actual cotisations paid by employers are about 40% of salary. But as Les Flamands and Val say, there are all the other costs too. That is based on being paid at SMIC level, I believe that paying over the SMIC attacts extra costs. Their employees are lucky, Mrs Will has to pay her own vehicle costs, fuel, phone etc.

The French way of working on the black, at least for individual artisans and small companies, is mostly to put some parts of a job through the books, and do other bits for money in the pocket. Outside the big scams on mjor construction projects, few are totally 'au noir', whereas there are quite a few British completely outside the system. Many through ignorance, but a few have a 'don't care' attitude.

[AnOther]

Pardon moi but what is SMIC level ?

[derf]

[quote user="ErnieY"]

Pardon moi but what is SMIC level ?

[/quote]

You will find some info here.

http://www.insee.fr/en/indicateur/smic.htm

[LesFlamands]

[quote user="Will"]

Actual cotisations paid by employers are about 40% of salary. But as Les Flamands and Val say, there are all the other costs too. That is based on being paid at SMIC level, I believe that paying over the SMIC attacts extra costs. [/quote]

Caisse Conges Paye is 20% and URSSAF is more than that, Assedic and Pro BTP as well. I was told that the basic cotisation was something like 68% then you have to add all the little bits and pieces. It's not just the cost but it's also an administrative nightmare. If you ever get to the stage of giving an employee a CDI your locked in for life. Everyones after the elusive CDI as it makes them creditworthy with the bank.

I still feel, however, we are missing some vital piece of information that only the native French employers and employees know about as I can't understand why and how so many people are so prosperous. If, as we a re lead to believe, some vast percentage (50%??) of the French workforce are on the minimum wage (SMIC, approx. 1250 euros a month before cotis. personnel of about 20%) how does anyone afford a mortgage or a new car?

[nimportequoi]

Well, if you have 3 or more children, the CAF benefits are quite good. But what percentage of the population have a morgage and/or new car? Granted I live in a rural area, but most people who live around me have neither, they live in rented accommodation and have very old cars. Or rented accommodation and a new car. But not a morgage and a new car.

[P-D de Rouffignac]

Yes, it is indeed a mystery how so many French people appear to live well. However after about six years in the region (Roussillon) I have gathered a few pointers:

A lot of middle-aged business owners or self-employed are living in the family home, either belonging to or inherited from parents

There is a vast pool of well paid professonals in the public sector (paid out of taxation) plus secure blue-collar jobs, health care, legal and accounting services, hotels, catering and leisure

If you are buying a new home you can be paying as little as 600 euros a month in mortgage repayments (over 30 years!)

Even if you are paying high social costs (a self-employed colleague contributes 2000 euros monthly) you could be getting half of this back in allowances

Numerous services are free (paid out of taxation) or low cost - schooling, university, health care etc

You can buy a new car on a lease/purchase scheme for less than 200 euros monthly

Comparatively little is spent on entertainment, with social life revolving around family and friends. Eating out is not generally expensive.

Many homes that look prosperous on the outside are sparsely furnished, with little spent on interior decoration. However they generally include all the latest gadgets including an Odeon-cinema sized flat screen TV!

I'm not sure if all this is depressing or encouraging but it does go some way towards explaining the apparent anomalies.

P-D de Rouffignac

[cooperlola]

Also, the benefits for which they pay are undoubtedly good.  A friend of mine here who has worked in the local abbatoir for years, recently was off work, for almost a year, due to an RSI caused by the work he does.  He received 90% of his normal salary all the time he was off work, and was quite scandalised that he did not get his mortgate paid on top!  Pensions can also be pretty good too, and for many workers are certainly relatively safe and secure - not something which many in the UK feel now....

[AnOther]

Swings and roundabouts then isn't it, pay heavily whilst earning, benefit proportionally when sick or retired.

Be nice if UK had a similar formula wouldn't it !

[cooperlola]

And yet the country is still heavily in debt....  Guess there's no perfect solution out there yet.

[AnOther]

[quote user="cooperlola"]And yet the country is still heavily in debt[/quote]and the UK isn't ?

[cooperlola]

Not to quite the same extent, perhaps.

Off there first thing - LMS Silverstone - I'll report back! Maybe by then I'll know if I'm going to have to find another couple of hundred euros a month to stay healthy....

[AnOther]

Maybe not quite as transparent [;-)]

Have fun and good luck, watch that ankle [;-)]

[Will]

I can't think of anything much less transparent than the funding of the French health system, for example, with all the regional CPAMs and the various other caisses.

Just to clarify, I am sure what Charles says is right for artisans employed full-time. However, I took the basic 40% employer cotisations from an actual pay slip, for a part timer (commercant) on SMIC (currently, I believe, 8.44€ per hour), the 16 or so deductions adding up to just over 40%. No paid holidays as such, no insurances other than the basic compulsory ones, Pro BTI doesn't apply, etc. Some may say that employment terms such as that could be illegal - I don't know for certain. What I do know is that they exist, and I mention it to show - for Ernie's benefit - that if you are a not-very-generous employer, you may get away with less enormous charges. It all depends what you do, and what sort of contract you can get away with.

You could also say that the employee should not put up with what amounts to exploitation. But that argument is countered by the fact that there are, literally, hundreds of English in France who would snap up that particular job if it became vacant, probably on even less favourable terms, and the demand is likely to increase because non-French residing in France want to build up a work record for healthcare and social security reasons.

[AnOther]

[quote user="Will"]that there are, literally, hundreds of English in France who would snap up that particular job if it became vacant, probably on even less favourable terms, and the demand is likely to increase because non-French residing in France want to build up a work record for healthcare and social security reasons.[/quote]Congratulations will, you sussed me out although I'm thinking somewhat more obliquely than out and out working for a living, who on earth want's to do that [;-)]

You're absolutely right of course that for someone with a few years to go to official retirement age, and with pre-existing health issues the cost of private health insurance which, from what I've learnt so far will likely exclude such conditions for a period of a couple of years at least, makes employment as a route into CMU a prospect - albeit not an appealing one nor for many I would imagine very likely.

I'm reluctant elaborate on my train of though in open forum so will send you a PM if I may ?