The
anatomy of a paycheck! (#2) |
Understand more about France with this example
of a paycheck ! |
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|
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- Case : a young professional,
hired one year ago, first job, administrative position, annual
salary $ 45 000.
- Employer : a successful investment
bank
- Working time : 162,5 hours/month
(full time) if
they work more than the mandatory 35 hours, employees (except
for top management) can recuperate up to two or three additional
weeks of vacation
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- Monthly Salary : $3,719
- In fact, he/she will actually cash
: $2,724
- But he/she will cost his/her boss :
$5,988
This
is a French
Mystery : to understand it,
read below :
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Plus (add to the
above mentioned salary):
- "Supplément familial"
(allocation for one child) : $ 105 (required by law)
- "Acompte 13ème
mois" (1/12 of an annual guaranteed bonus) : $ 391 (required
by law)
- Incentive to use public transport
$ 28 (required by law) (you can cash it in even if you don't use it)
- Corporate life insurance plan
(half is paid by employer) : $ 67 (company policy)
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Not
included various
benefits which are paid once a year (all the following are subject to most withdrawals
listed below) :
- "Participation"
: part of the net profit of the company which must legally be
assigned to employees and blocked (5 years) in a corporate saving
fund ; in this case (a very profitable company) , approximately
5 to 6 weeks of salary
- "Intéressement"
: an incentive program to motivate all the staff to reach corporate
objectives ; in this case, approximately 1 to 2 weeks of salary
- Individual bonus : does
not apply to this particular case ; for higher ranking professionals,
typically 0 to 40% of annual salary
- Of course, it does not include
all the services offered at reduced price by the Comité
d'Entreprise
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Minus : everything
required by law except corporate life insurance plan (which is
a policy of the company and applies to everybody) and not
including employee's income
tax, which is paid separately by employee
Withdrawals from paycheck
and direct employer's contribution |
$ paid by employee |
$ paid by employer |
Contribution to Social Security
(health) (as you see, most of it is
paid by the employer) |
Contribution to Social Security
(retirement) (idem) |
Insurance for work accidents
(idem) |
Tax for public social programs |
State family policy programs
(idem) |
CSG (tax to finance State social
programs) (idem) |
Unemployment
(idem) |
Specific unemployment for professionals |
Retirement
(additional to Social Security program, specific for "cadres") (idem) |
"Mutuelle" Social
Security (private plan) (idem) |
Corporate life insurance plan |
Specific tax for Education
(idem) |
For public housing (idem) |
For public training programs (idem) |
For public transport (worth
it - the public transport is good!) |
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31
|
195
|
0
|
105
|
0
|
184
|
115
|
1
|
176
|
52
|
135
|
0
|
0
|
0
|
0
|
|
474
|
321
|
37
|
17
|
200
|
399
|
190
|
1
|
274
|
108
|
67
|
18
|
55
|
15
|
93
|
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This is the normal number
of lines you'll find on all French paychecks. Sometimes they
are even more ! Compare it to an American one !!
UPDATE ! As of January 2017, a legal change considered revolutionary (!) reduced the number of lines from around 40 to around 20 (many taxes are now put together on one line) |
Total
1 |
Salary
+ benefits |
$3,719
|
|
2 |
minus : withdrawals by employer |
$995
|
(does
NOT include employee's income tax, paid separately, one
year later) |
3 = 1 -
2 |
Total
cashed by employee |
$2,724
|
what
you get |
4 |
Taxes
paid by employer (in addition to 1) |
$2,269
|
|
5 =4 +1 |
Total
cost for employer |
$5,988
|
what
you cost your boss |
6=2+ 4 |
Total
taxes/contributions |
$3,265
|
(>54%
of work cost) |
Warning : this page was designed a few years ago. Since that date, legislation has changed a bit and it will have to be updated soon but whatever the changes which happened or would happen in the immediate future, two things are sure : it is now more complicated and more costly for employers (at least as of today Nov. 2015).
- All the
benefits mentioned above result from the law and generally an
additional (more favorable) agreement between the company and
its unions (see : "partenaires sociaux"). They are considered "avantages
acquis", which means it is extremely difficult, if not
impossible, to suppress them.
- See an interesting
simulation (it's in
French but easy to understand)
- For higher salaries : see the
figures for executives in various countries of Europe ; the French government
develops specific provisions so that the level of taxes and contributions
would not impact the attractivity of France for headquarters
of big corporations
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- A French salary slip MUST include the following details :
- a complete identification of the employer with code numbers APE (Industry Classification System), SIRET (Firm's Identification Number) and URSSAF (Firm's Social Benefits' Number)
- the identification of the employee with code number Social Security and all necessary elements about his qualification and type of job
- a recapitulation of "total paid" and "total to declare in your tax form' (it is not exactly the same amount : the latter is a little higher)
- a recapitulation of vacation and RTT days
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DID YOU KNOW THAT..... ? Although the number of
employees who are members of an union is small (less than 10%), unions have a
lot of power because, by law, each company (above 10) must have
at least one "délégué syndical"
and (above 50) a "comité d'entreprise" which
must be consulted on any important issue concerning the company
; labor contracts must be signed with one or more of the "syndicats
représentatifs" , which means, practically, one or
more the the largest national unions : CGT (Confédération
Générale du Travail, close to what is left of the
communist party), CFDT (Confédération Française
Démocratique du Travail, more modern and reform-oriented),
CGC (Confédération Générale des Cadres,
for professionals), CFTC (Confédération Française
des Travailleurs Chrétiens, close to the Catholic church),
SUD (younger, fast developing, more leftist), and a few more. |
To related pages : working in
France (#1), doing business in France (#4), the
French Social Security system., history of American firms in France, etc... and See my new section Job Offers |
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page
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Harriet Welty
Rochefort writes articles and books about France and the French.
Order her books :
- "Joie de Vivre", Secrets of Wining, Dining and Romancing like the French, St.Martin's Press, New York, 2012
- "French Toast, An American in Paris
Celebrates The Maddening Mysteries of the French", St.Martin's Press,
New York, 1999
- "French Fried, The Culinary Capers
of An American in Paris", St.Martin's Press, New York, 2001
More on Harriet's
books
(excerpts, upcoming events, testimonials, etc..)
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