How to benefit from Zero Charges on new employees recruitment
31 Oct 09
In December 2008 the Plan de Relance de l’Economie (economy recovery plan) launched a new initiative entitled “Zéro Charges”. Aimed at small and medium size companies with fewer than 10 employees, this scheme offered a 12 month exemption of employer’s social charges contributions “charges patronale” on new employees. Used by over 500 000 small companies so far, the deadline should be extended until June 2010.
Christine Lagarde, Minister of the Economy recently said on France Inter radio that she strongly hoped the “zero charge” scheme would be extended, allowing very small businesses “to receive a total exemption of charges for twelve months for any job created by 30th June 2010”. The law is currently being voted by the Conseil des Ministres as part of the “loi de finance 2010”.
\Zéro Charges completely exempts small businesses from employer’s social charges contributions (charges sociales patronales) on the hiring of new employees paid the minimum wage, also called SMIC. This financial help comes to about 185€ per month for a full time worker on minimum wage. The exemption then decreasing for salaries up to 1.6 SMIC. The Government is responsible for compensating the Social Security fund and unemployment insurance, as the employer does not pay expenses for his employee.
So how does it work and could your company benefit from this scheme? The applications criteria are flexible enough, as it applies to the hiring of a full-time or part-time, permanent (CDI Contrat a Durée Indéterminée) or fixed-term (Contrat à Durée Déterminée) contract of more than a month. It also applies to the renewal of a fixed term contract for a period exceeding one month, or for a CDD turning into a CDI. Interim contracts, however, are not eligible.
How to apply for “Zero Charges”?
If you are planning to recruit a new employee by the 31 December 2009 (or by 30 June 2010 once the law has been voted) download the form “Demande d’aide a l’embauche TPE Cerfa No. 13838’’ on http://www.zerocharges.fr or request a form from your local unemployment center - Pole Emploi. Complete and return the form to Pole Emploi, together with a copy of the work contract.
At the end of each quarter, you will have to send an up-dated form to Pole Emploi to calculate the financial aid. The form must be returned within 3 months following the quarter for which the financial help is requested.
What conditions must be fulfilled for benefit?
Zero charges applies to recruitment for SME
- Full-time hiring
- Part-time, permanent or fixed-term contracts hires of more than a month
- Renewal of a fixed term contrat or CDD (Contrat a Duree Limitee) for a period exceeding one month
- Transformation of a fixed term contract (CDD) into a permanent contract (CDI Contrat a Duree Limitee)
- ’‘contrat de professionnalisation’’ for job seekers aged 45 and over.
In order to qualify for this scheme the employer should not have preceded to a redundancy over the last 6 months for the post being filled by recruitment.
This article has been published in the November issue of TheFrenchPaper
