France: Changes to Expect in 2021

February 3, 2021
5 mins read

Highlights of the new legislation coming into effect this year.


Increase in Minimum Wage (SMIC) Salaire Minimum de Croissance

As of 1 January 2021, the minimum hourly wage (SMIC) increases to €10.25 -an increase of 0.99% from 2020.

The new SMIC rate applies to remuneration for periods of employment on or after January 1, 2021.


Employers Social Security Contribution

The portion of the social security contributions to which the general degressive reduction can be applied is set at 0.70 points in 2021.

Internship Bonus

The 2021 internship bonus is based on the Social Security hourly ceiling, which is €26 for 2021.

The 2021 internship allowance is €3.90 per hour.

Employers, please note:

From the government’s viewpoint, when the trainee‘s bonus is less than or equal to an amount determined each year, no contribution or social contribution is due by the host company or the trainee. This is known as the contribution exemption.

The exemption is equal to the amount of the mandatory minimum bonus for an internship of more than 2 months (i.e., the sum of 15% of the Social Security hourly ceiling multiplied by the number of internship hours completed during the month).

If the bonus paid is higher than this minimum, contributions are only due on the fraction above.

The exemption covers employee and employer contributions to Social Security, the CSG and the CRDS, the autonomous social contribution, the transport payment, and the FNAL contribution, where applicable.

However, because the trainee is not an employee, the unemployment insurance contributions and the employer’s contribution to the trade union organizations’ financing are not due even if the bonus paid exceeds the deductible threshold. Also, the gratuity is exempt from income tax.


Restaurant Meal Vouchers

2020 restaurant vouchers, which are due to expire at the end of February 2021, have been extended to 1 September 2021.

The doubling of the daily ceiling for the use of vouchers in restaurants was increased to €38 per person from June 12, 2020. This measure is extended until September 1, 2021, and people are allowed to use them on weekends and public holidays.


Employer’s, please note:

The benefit of the exemption is conditional to the following limits:

  • The employer’s contribution may not exceed 60% of the final value of the voucher.
  • It must be at least equal to 50% of this value.
  • The value of the restaurant voucher entitling the exemption is between €9.23 and €11.08.


Payroll Tax

The scale of payroll tax in 2021 is:

  • 25% on the fraction of annual compensation less than €8.020
  • 50% of €8.021 to €16.013
  • 60% above €16.013

The amount of the tax rebate on salaries paid in 2021 is €21,086.

The abatement relates in particular to the associations of the law of 1901 and the professional unions.


Extension of Paternity, Birth and Adoption leave


Paternity and Childcare leave:

From 1 July 2021, Paternity and Childcare leave will increase from 11 to 25 calendar days- an increase of 14 days.

Taking into account the Labor Code‘s birth leave of 3 working days, an employee now has a total of two leaves,  a minimum right of 28 days instead of the previous 14.

In the case of multiple births, paternity leave increases from 18 to 32 calendar days -to which an employer must also add the 3 days of birth leave.

Paternity leave will include a compulsory part, covering 4 consecutive days of paternity leave, which will be added to the birth leave -3 days, unless a higher duration is fixed by collective agreement.

The balance of the paternity leave (21 days in principle, 28 days in the case of multiple births) may be taken consecutively or later, if necessary, by splitting it.

Adoption leave

From July 1, 2021, adoption leave increases from 10 to 16 weeks. An increase of 6 weeks.

Extension of Birth Leave Recipients

From July 1 2021, the leave will benefit not only the father of the child but also, where applicable, the spouse, the partner, or the legal domestic partner of the mother.

Important Information:

Birth leave is fully paid by the employer. It is 3 working days, unless a longer period is provided for by a collective company or agreement or, failing that, by a branch agreement.


Revaluation of benefits in kind and professional expenses as of January 1, 2021


  • Benefits in-kind for food: Where the employer provides the food, the value of this benefit in kind will be assessed at a flat rate of €4.95 per meal or €9.90 per day.
  • Benefits in-kind for housing/lodging: When the employer provides housing, this benefit is determined on the basis of a monthly lump sum based on the number of rooms and the employee’s level of remuneration established by reference to the Social Security monthly ceiling.

Professional Fees

Meals flat-rate allowances for professional expenses are excluded from the basis for social security contributions within certain limits fixed as of January 1, 2021:

1) Shift, teamwork, continuous, staggered, or night work.

(2) Where it is not demonstrated that circumstances or customs require the employee to eat at a restaurant. Example: employee working on a construction site.


Moving expenses inside France


Professional Travel

Employers are authorized to deduct from the social security contribution base expense allowances for professional mobility:


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