The generalization of telework involves new legal problems to be solved. The home occupation allowance for professional purposes is one of them. We are going to discover the characteristics of this indemnity, the conditions of payment as well as the risks of conflicts.
I – Definition of occupancy allowance
It is divided into two different allowances:
- the constraint caused by the occupation of the employee’s home for professional purposes;
- the costs generated by this occupation.
With regard to professional expenses, it is up to the company to cover the expenses incurred by the employee for the purposes of his professional activity and in the interest of the company, after prior validation by the employer. The home occupation allowance compensates for the inconvenience resulting from the use of the accommodation for professional activity.
The case law of the Court of Cassation on home occupation compensation in the event of teleworking is rare. The Court of Cassation nevertheless established the principle, in cases concerning itinerant employees, that an indemnity for occupying the home is due to the employee when a professional premises is not actually made available to him.
It should be added that recent Court of Appeal judgments, concerning facts that occurred before the health crisis, seem to extend the conditions for payment of this compensation in the following cases:
- when the employer imposes a particular constraint on the employee (understood as the implementation of teleworking at the request of the employer);
- when professional premises are not made available to the employee by the employer (which confirms the position of the Court of Cassation).
II – Conditions for payment of this compensation
When the employer asks the employee to use his home on a professional basis, he must obtain the employee’s prior consent to do so.
It follows from case law (see above) that in this case the employee is entitled to compensation for the occupation of his home for professional purposes.
Outside the context of the COVID health crisis, the employee who works from home must be compensated for this particular constraint only if no premises are made available to them by the employer or when teleworking is imposed by the employer. It is up to the employer to justify that professional premises are made available to the employee.
It should be added that recent case law has specified that the employee taking the initiative to telework, without the agreement of his employer, and in the absence of any collective agreement to this effect, will not obtain reimbursement of the costs incurred.
We can therefore conclude that only the costs resulting from telework framed by a collective agreement, or a charter, or even an agreement of the employer, must be borne by the employer.
It should also be specified that the occupancy allowance is not a salary element and that it is subject to the prescription of personal and movable actions.
III – Amount of compensation and consequences on social charges
Calculation of the amount of compensation
It is possible to evaluate the cost generated by the occupation of the residence, on the other hand, it is difficult to evaluate the constraint generated by this occupation.
Costs resulting from the exercise of regular teleworking
The employer is subject to the general obligation to cover the costs incurred by an employee in the context of his work. Thus, the costs generated by teleworking being deemed to be expenses inherent in the job, they must be borne by the employer.
Cost of ergonomic work equipment
When regular teleworking is introduced, the work equipment ensuring optimal protection of the health and safety of the employees concerned is necessarily the responsibility of the employer. If the employee makes the advance, he may obtain reimbursement, on receipt, provided that the expense is necessary, justified and not excessive.
Constraint generated by occupation
The Court of Cassation recognized that the occupation of housing for professional purposes results from the storage of professional equipment and does not vary according to the actual working time or the use of delegation hours. This solution seems to call into question, in part, the previous case law according to which “objective and relevant elements may justify the granting of different allowances according to the categories of staff considered, in this case a different occupation rate, in terms of time and space, from the employees’ homes for professional purposes”.
Under these conditions, it is not possible to propose an amount of compensation. We can only specify that in a case where itinerant employees, medical representatives, had to carry out a certain number of administrative tasks (managing orders, preparing their visits and reporting on them, updating their information, answering their emails, accessing mandatory training dispensed at home) the trial judges set the occupancy allowance at a lump sum of €91 per month.
Employment allowance and social charges
Exemption conditions
The decree of December 20th 2002 relating to deductible professional expenses for the calculation of social security contributions provides for three categories of expenses inherent in teleworking which may be excluded from the contribution base:
- fixed and variable costs related to the provision of private premises for professional use;
- costs related to the adaptation of a specific room;
- costs of computer equipment, connection and miscellaneous supplies.
It should nevertheless be specified that other types of costs may be excluded from the social security contribution base, provided that the employer can demonstrate that they are professional costs related to teleworking.
Exemption limits provided by URSSAF
There are two methods of compensating employees working from home:
Flat-rate allowances
The flat-rate allowance paid by the employer to an employee teleworking is exempt from contributions and social contributions within the overall limit of €10 per month, for an employee performing one day of teleworking per week. This lump sum allowance can therefore amount to €20 per month for an employee doing two days of teleworking per week, €30 per month for three days per week, etc.
When the flat-rate allowance is provided for by the branch collective agreement, the professional or inter-professional agreement or a group agreement, it is exempt from social security contributions and contributions within the limit of the amounts provided for by the collective agreement, even if the latter is greater than the amount set above.
When the amount paid by the employer exceeds these limits, the exemption from social charges may be accepted provided that the reality of the professional expenses borne by the employee is justified.
Reimbursement of expenses actually incurred by the employee
These refunds may relate to:
- the rent for the premises used for teleworking;
- heating, air conditioning and electricity costs;
- expenses for the acquisition of furniture and adaptation of the premises;
- purchases of computer equipment and consumables;
- connection costs.
The amount of these expenses must be justified by the presentation of invoices.
URSSAF also provides a table to assess the reimbursable amount of expenses incurred by the employee. Click here to access to this table on the URSSAF website.
To end this article, we give you some advice to limit the risk of litigation:
- It is preferable (as we suggested above), to favor the initiative of the employee for the implementation of telework. However, a court could require the payment of a home occupation allowance if constraints such as keeping records are imposed on the teleworker at his home at the request of the employer.
- The employer must (if possible) allow all teleworkers to access a third location (e.g. co-working space, etc.) to avoid calling into question the qualification of telework as voluntary work.
- It may also be interesting to include an end of telework clause. Indeed, a judgment of December 7th 2021 from the social chamber of the Orléans Court of Appeal recalls that, in the absence of a reversibility clause, the employer cannot unilaterally end teleworking if this upsets the personal life of the employee.
All the team of French Business Advice is at your disposal, so do not hesitate to contact us!
