Apprenticeship in France: Exceptional Financial Aid to Employers Who Recruit Young Apprentices
As part of the “#1jeune1solution” plan, the government is setting up exceptional aid for the recruitment of apprentices up to master’s level for all companies (decree no. 2020-1084 of 24 August 2020). Assistance will be paid for contracts signed between 1 July 2020 and 28 February 2021.
How High is the Exceptional Aid for Apprenticeships in France?
Aid of up to
- EUR 5,000 for an apprentice under the age of 18
- EUR 8,000 for an apprentice aged 18 or older
will be provided for apprenticeship contracts preparing for a diploma up to a master’s degree (baccalauréat + 5 years = level 7 of Répertoire National de la Certification Professionnelle).
Which Employers are Eligible for the Exceptional Aid?
The state payment for apprenticeships in France is for companies with
- less than 250 employees,
- more than 250 employees, provided that they undertake to reach the threshold of apprenticeship or employment contracts in their workforce by 2021 according to terms defined by the decree (if the terms are not met the sums received must be reimbursed).
Under this measure, there is a small residual cost to the company of recruiting an employee on an apprenticeship contract: the aid covers 100% of the salary of an apprentice under the age of 21 and 80% of the salary of an apprentice between the ages of 21 and 25.
The French government is supporting companies that train apprentices or offer employment contracts to young people despite the poor economic situation due to the corona pandemic.Gérard Bénazra, Chartered Accountant, Certified Auditor/Tax Advisor, Partner, ECOVIS France, Paris, France
It should be noted that at the end of the first year of the contract, companies eligible for the one-time aid will be able to benefit from this aid until the end of the contract, say the Ecovis advisors.
What are the Terms of Payment?
The management and monitoring of the aid is entrusted to the Service and Payment Agency (ASP). It will be paid monthly, before payment of the apprentice’s salary.
New Employment Assistance
As announced by the government, a decree of 5 August 2020 implemented assistance for companies hiring young people under the age of 26 on contracts concluded between 1 August 2020 and 1 January 2021.
Employers can obtain assistance up to a maximum amount of EUR 4,000 for hiring of a young person on a permanent or fixed-term contract of at least 3 months paid up to a maximum of 2 SMIC (EUR 3,078.90 based on working 35 hours per week). SMIC (interprofessional minimum wage for growth) is the legal minimum wage in France. As of 1 January 2020, this minimum wage has been set at EUR 10.15 (gross) per hour and EUR 1,539.42 per month (gross).
The aid is paid in arrears on a quarterly basis, at a maximum rate of EUR 1,000 per quarter, limited to one year. The application for aid is sent electronically by the employer to the ASP within a maximum of 4 months following the date of commencement of the contract. The application for assistance can only be sent to the ASP from 1 October 2020, explain the Ecovis consultants.
The assistance is not payable
- for employees’ periods of absence which did not give rise to the maintenance of the remuneration by the employer or
- for periods during which the employee is placed in a position of partial activity.
Taxes and Social Security
The employer must be up to date with his reporting and payment obligations to the tax authorities and to the bodies responsible for collecting social security or unemployment insurance contributions and dues. He may also have subscribed to and comply with a plan for the settlement of outstanding contributions and dues. The employer must not have carried out any dismissal for economic reasons in the position covered by the aid since 1 January 2020.
For further information please contact:
Gérard Bénazra, Chartered Accountant, Certified Auditor/Tax Advisor, Partner, ECOVIS France, Paris, France
Email: gerard.benazra@ecovis.fr