The Social Security 2024 Finance Act (LFSS) was officially adopted on December 4th, 2023. This law includes numerous measures, below are presented those which are directly in connection to companies, in particular the management of payroll or social security contributions for self-employed workers (freelancers).
I – Contributions provisions on salaries
Employer contributions
- Transmission of information for the rectification of the social rights of employees in the event of URSSAF adjustment
The law provides that, from January 1st, 2024, when an adjustment of contributions and social security contributions made by the URSSAF will have an impact on the employees’ rights under social insurance and legally obligatory supplementary retirement (AGIRC-ARRCO), URSSAF will transmit to the relevant organizations, the information necessary to correct the rights.
Presently, in the event of contributions’ adjustment, URSSAF must only transmit to CARSAT (retirement and occupational health insurance fund) the information necessary for it to proceed with the rectification of employees’ rights under the basic senior’s insurance.
- Remuneration’s cap giving entitlement to reductions in the rate of employer health contributions and family allowances
Deindexation of the SMIC from salary ceilings giving entitlement to rate reductions:
- To avoid automatic indexation to the SMIC of salary ceilings giving entitlement to these rate reductions, the ceiling amount of remuneration giving entitlement to rate reductions will be set by decree. However, it cannot be less than:
- 2.5 times the minimum wage (SMIC) in force on December 31st, 2023, for the health contribution
- 3.5 times the minimum wage (SMIC) in force on December 31st, 2023, for the Family Allowance contribution.
- Details of the social system for conventional termination compensation (RCI)
Individual conventional termination compensation occurring since September 1st, 2023, are exempt from social security contributions and charges, having the same basis within the limit of two annual social security ceilings, “including when they are taxable”, up to of the following highest amount, either:
- The legal or conventional minimum severance pay or,
- 50% of the compensation or twice the employee’s gross annual remuneration over the calendar year preceding the termination.
Before this update, the BOSS (Bulletin Officiel de la Sécurité Sociale) did not really detail the social regime of the RCI compensation paid to the employee entitled to benefit from a senior’s pension, in particular in terms of social security contributions.
- “Social security” workforce and employees made available by a group of employers
The “social security” workforce designates all of the workforce count rules which apply to the thresholds set by the social security code. Currently, employees made available by a group of employers are not counted in the workforce of the host company, but in that of the group. For seconded employees, contributions are paid by the employer of these employees and not by the user company. In fact, these employees are counted in the workforce of their employer, the group.
It is now planned that from January 1st, 2026, at the latest, employees made available by a group of employers will be taken into account in the “social security” workforce of the user company, in the appropriate proportion of their working time, except with regard to AT/MP pricing.
Social declarations
- Obligations of foreign companies without establishment in France
Foreign employers whose company do not have an establishment in France make declarations and payments of legal or conventional social contributions regarding the employment of employed staff to a single collection body: the URSSAF Foreign Firms Service (TFE/SFE). To fulfil their obligations, the employers can appoint a representative residing in France who may be a third party to the company or one of its employees. This is a possibility, not an obligation.
The electronic one-stop shop for business formalities, mandatory since January 1st, 2023, now allows foreign companies without an establishment in France to carry out all of their formalities electronically, without having to resort to a corporate representative in France.
From March 1st, 2024, foreign companies will no longer be able to delegate to an employee or a third party residing in France the responsibility for carrying out their social declarations.
They will have to register with the electronic one-stop shop (Net Entreprise) to be able to comply with their social obligations.
- Simplified agricultural employment title (TESA-S)
From January 1st, 2024, the use of the TESA-S will allow the employer to meet the obligation to issue a DSN or, when applicable, to establish the formalities and declarations for which the DSN replaces.
In addition, the employer who uses the TESA-S or the TESA+ will be deemed to satisfy new formalities:
- Maintaining the unique staff register
- Declarations relating to withholding of income tax
- Providing the employee with one or more written documents containing the main information relating to the employment relationship.
II – Contributions provisions for self-employed workers
Unification of the social contribution base
- The social contribution base for self-employed workers is reformed from January 1st, 2025, in order to strengthen the fairness of their social security contributions with employees and improve their social protection. Social security contributions due by non-agricultural self-employed workers not covered by the micro-social regime will be based on the base applicable to the CSG.
The social base will be subject to a reduction of 26% which cannot be:- Less than a minimum amount, set by decree
- Greater than a ceiling amount, also set by decree at a value at least equal to the annual social security ceiling.
- The law also provides for the end of specific rates for liberal professionals attached to the social security of the self-employed. Thus, from January 1st, 2024, it is impossible to request a specific rate for the calculation of supplementary pension contributions for certain unregulated liberal professions which fell within the scope of affiliation of the CNAVPL (and the CIPAV) and which have been attached to the old-age insurance of self-employed workers, managed by the general system.
New obligations for digital platforms
Currently, all self-employed workers carrying out their activity through a platform whose activity consists of connecting several parties electronically with a view to the sale of a good or the provision of a service can authorize by mandate to carry out electronically the declaration procedures for the start of activity with the one-stop shop for business formalities. This option will not be modified.
The law establishes a mandatory regime for the declaration and withholding of social security contributions by platforms, for self-employed workers covered by the micro-social regime (or self-employed) who carry out their activity via digital platforms.
Thus, by 2027, their social contributions will be collected directly by the platforms.
The direct debit obligation will also concern users of the platform who have chosen to join the general regime (short-term furnished rentals and rentals of movable property).
Entrepreneurs (sellers or service providers) will transmit to the operators of the platforms they use, the data allowing their identification.
The costs of the debits, declarations and payments that they are required to make will be carried by the platform operators.
III – Other provisions of the Social Security 2024 Finance Act
Sick leave
- Limitation of the duration of sick leave delivered via teleconsultation
The prescription or renewal of a sick leave during a telemedicine procedure cannot cover more than 3 days, nor have the effect of extending the duration of the leave already in progress to more than 3 days, except in the following cases:
- Prescription or renewal of sick leave by the insured’s attending physician or midwife
- Justified inability by the patient to consult a competent medical professional to obtain, by prescription in their presence, an extension of the sick leave.
- Removal of the IJSS waiting period in the event of medical termination of pregnancy (IMG)
The LFSS provides that for sick leaves prescribed from a date provided for by decree and no later than July 1st, 2024, women who have undergone an interruption of pregnancy for medical reasons will now be able to receive, during their sick leave, IJSS (social security payments) disease without waiting period.
Gradual retirement
Gradual retirement allows, under certain conditions, an insured person to continue working part-time or reduced time, while benefiting from a fraction of their provisional retirement pension, which depends on the length of time worked. Once the employee decides to retire, its provisional pension is recalculated, considering the rights acquired because of working part-time.
Some company directors are obligatorily affiliated to the general social security system even though they do not have an employment contract. Gradual retirement was admitted for their benefit by the LFSS 2022. However, the modification of the legislative provisions relating to progressive retirement made by the law of April 14th, 2023, has maintained the eligibility for this system for managers whose activity is not subject to work quota and accidentally closed access to progressive retirement to those whose activity is subject to work quota.
The 2024 Finance Act accordingly corrects the social security code and thus secures the situation of “employee-like” corporate officers (minority or egalitarian managers of SARL, General Directors of SA, etc.).
If you have any questions about any of the points raised in this article, please don’t hesitate to contact us!
