Bonuses are an essential part of employee remuneration in France. They represent salary supplements paid according to a variety of criteria, ranging from individual performance to specific job constraints. Understanding the list of existing bonuses will enable you to optimize your compensation policy while complying with legal and collective bargaining obligations. These benefits form part of your company’s broader social and payroll management framework.

What is the bonus list?

Bonuses refer to all additional remuneration that an employer may pay to its employees in addition to the basic salary. In France, there are over 25 different types of bonuses, representing an average of 15-20% of gross annual pay, depending on the sector. These bonuses fall into three distinct categories: mandatory statutory bonuses (such as the thirteenth-month bonus provided for in certain collective bargaining agreements), bonuses linked to company practice (which create an acquired right through their regular and constant payment), and optional bonuses based on the employer’s discretionary policy (such as exceptional bonuses). These bonuses meet a variety of objectives: rewarding performance, compensating for particular constraints or building employee loyalty.

These remuneration supplements form part of the fringe benefits and professional expenses you offer your teams. Their tax and social security treatment varies considerably according to their nature and the conditions under which they are granted, with some eligible for exemptions similar to deductible actual expenses under strictly defined conditions.

Performance and results-related bonuses

Objective-based bonuses are one of the most widespread forms of variable compensation. It rewards the achievement of pre-defined individual or collective results. The amount of the bonus depends directly on performance measured against precise indicators. Today, some 60% of French companies use at least one form of performance bonus, testifying to the importance of this motivational lever in modern human resources management.

Performance bonuses are designed to reward employee productivity. It is particularly applicable in industrial sectors where production can be objectively quantified. Its calculation is generally based on measurable criteria such as the number of units produced or sales generated. These bonuses are particularly developed in certain specialized business sectors such as sales, technology and finance, where 60 to 70% of sales executives benefit from variable remuneration linked to objectives. The variable component can represent between 10% and 50% of total compensation, depending on the position and responsibilities held.

The seniority bonus rewards employee loyalty. Although less linked to immediate performance, it recognizes accumulated experience and professional stability. The amount of the bonus increases progressively with years of service with the company.

Exceptional bonuses and gratuities

An exceptional bonus is awarded on a one-off basis in recognition of an outstanding contribution or a special event. It does not create a vested right for the employee, unlike regular bonuses included in the employment contract.

The Value-Sharing Bonus (PPV), formerly known as the Macron bonus, is now an essential part of the exceptional compensation package. More than 50% of French companies paid this bonus in 2023, with an average amount of between 800 and 1,000 euros. Its main advantage lies in its tax-exempt status: it can be fully exempt from social security contributions and income tax up to 3,000 euros, or even 6,000 euros under certain conditions (companies with fewer than 50 employees, profit-sharing agreements, or employees paid less than 3 SMIC). This scheme enables employers to reward their employees in a tax-efficient way, while boosting purchasing power.

The balance-sheet bonus rewards the company’s annual results. Its payment depends on overall performance, and can vary significantly from one year to the next depending on the company’s financial health.

Compensatory bonuses linked to working conditions

The arduous work bonus compensates for exposure to occupational risk factors. It recognizes the physical or environmental constraints to which certain employees are exposed in the performance of their duties. Such compensation is part of the employer’s broader social obligations.

Night bonuses are paid for work performed during the night, generally between 9pm and 6am. The rate varies from one collective agreement to another, but typically represents between 10% and 50% of the basic hourly wage. This bonus compensates for the disruption to biological rhythms and family constraints associated with night work.

The Sunday and public holiday bonus increases the pay of employees working on these special days. It compensates for the social and family constraints involved in working during these normally non-working periods. The amount is generally set by collective agreement or company practice.

Job mobility bonuses

The travel allowance compensates for the constraints associated with frequent business travel. It is in addition to the reimbursement of home-to-work mileage and other business expenses.

The basket or tooling allowance covers specific expenses incurred by the employee in the course of his or her work. It is similar to meal allowances in its compensatory nature.

In addition to these optional bonuses, certain reimbursements are required by law. Since 2009, employers have been required to reimburse at least 50% of the cost of public transport tickets used by employees to commute to and from work. This mandatory contribution applies to public transport season tickets, and is a separate item from traditional business expenses.

The sustainable mobility package, introduced in 2020, enables employers to cover the cost of commuting to and from work by bicycle, carpool, electric scooter or other “soft” modes of transport. This lump-sum payment is tax and social security exempt up to €700 per year and per employee, thus encouraging environmentally-friendly mobility practices.

These two schemes can be combined, up to an overall exemption ceiling of €800 per year. This combination offers considerable flexibility for employees who use several alternative modes of transport for their daily commute.

Annual and seasonal premiums

The thirteenth month is the equivalent of an extra month’s salary paid annually. Often provided for in collective agreements, it is an element of remuneration expected by employees and can be paid in one or more instalments.

Vacation bonuses make it easier for employees to go on vacation, by providing them with additional income. The amount generally varies from a few hundred to several thousand euros, depending on the business sector and applicable agreements.

The end-of-year bonus or Christmas bonus rewards employees at the end of the financial year. Depending on established practice, it may be awarded on the basis of seniority or company results.

Bonuses for personal events

The wedding bonus celebrates the employee’s union and demonstrates the employer’s recognition of the important moments in the employee’s personal life. Although less and less systematic in today’s companies, it still exists in certain traditional sectors and collective bargaining agreements. The amount generally varies between 150 and 500 euros, depending on the agreements in force, and may be conditional on a minimum length of service with the company.

The birth bonus accompanies the arrival of a child in the employee’s family. It reflects the employer’s attention to the work-life balance of its teams. This bonus, usually ranging from 200 to 800 euros, can be paid for each birth, adoption or arrival of a child in the home. Some companies extend this scheme to multiple births, with higher amounts, thus reinforcing their policy of supporting parenthood.

Incentive and profit-sharing bonuses

The profit-sharing scheme associates employees with the company’s results or performance, according to a predefined calculation formula. This optional scheme is exempt from social security contributions (excluding CSG/CRDS) up to a limit of 75% of the annual Social Security ceiling (PASS), i.e. around €33,000 in 2024. Profit-sharing is fully exempt from income tax if invested in an employee savings plan (PEE or PERCO). For executives, see our page onprofit-sharing for non-salaried executives.

Profit-sharing is compulsory for companies with more than 50 employees. It redistributes a portion of profits earned according to a statutory formula, enabling employees to share directly in the collective success. When invested in a savings plan, profit-sharing payments benefit from the same tax advantages as incentives.

These employee savings schemes reinforce employees’ sense of belonging and align their interests with those of the company. The sums invested in a PEE can be released early in certain cases (purchase of principal residence, marriage, birth), while those invested in a PERCO are blocked until retirement, except in exceptional cases of early release. They represent powerful levers for motivation and loyalty, while offering significant tax optimization.

Tax and social security treatment of bonuses

The tax and social security treatment of bonuses varies considerably according to their nature. To optimize your compensation policy, it is essential to distinguish three categories of bonuses according to their liability to social security contributions and income tax.

Bonuses fully exempt under certain conditions: The value-sharing bonus (PPV) is exempt up to €3,000 per year per employee, raised to €6,000 for companies with fewer than 250 employees that have a profit-sharing agreement. Profit-sharing is exempt from social security contributions up to 75% of the annual Social Security ceiling (PASS). Profit-sharing also benefits from a favorable social security regime when invested in a savings plan.

Partially-exempt bonuses: Luncheon vouchers are exempt from social security contributions for between 50% and 60% of their value, up to a limit of €6.91 per voucher in 2024. The mandatory 50% reimbursement of home-to-work transport costs is exempt, as is the sustainable mobility package of up to €700 per year for alternative modes of transport. Bonuses linked to business expense accounts may be exempt if they comply strictly with URSSAF scales.

Bonuses still subject to social security contributions and income tax: Performance bonuses, the thirteenth month’s pay, seniority bonuses and most exceptional bonuses are fully subject to social security contributions and income tax in the same way as basic salaries.

Optimizing the applicable regime requires in-depth expertise in employment and tax law. Inadequate structuring or non-compliance with exemption conditions can lead to significant URSSAF reassessments and compromise the economic advantage sought for both the company and the employee.

Setting up and managing bonuses within the company

The introduction of a bonus requires clear formalization of the conditions under which it is awarded. Whether provided for in the employment contract, a collective agreement or company practice, its implementation must respect the principles of equal treatment and non-discrimination.

Transparent award criteria avoid potential disputes. For each type of bonus, you must explicitly communicate the calculation methods, targets and reference periods.

Regular review of your bonus policy ensures that it is in line with your strategic objectives. Changes in legislation and collective bargaining agreements also require constant monitoring to ensure that your practices remain compliant. This tax review approach is part of a rigorous management of your company’s accounting and social obligations.

Optimize your compensation policy with bonuses

A well-designed bonus list is a strategic human resources management tool. It enables you to attract talent, motivate your teams and reward outstanding contributions, while keeping your payroll under control.

The balance between mandatory and optional bonuses, between fixed and variable remuneration, must be adapted to your business sector and corporate culture. Mandatory bonuses are part of the broader framework of compulsory deductions that govern your compensation policy. This personalization strengthens the effectiveness of your overall compensation policy.

To ensure that your bonus system is legally and fiscally secure, it is essential to work with experts in employment and tax law. They can help you structure effective schemes while minimizing the risk of tax adjustments and maximizing the benefits for all stakeholders.

Value-sharing premium (VSP)

The Value-Sharing Bonus (PPV), formerly known as the “Macron bonus”, is an exceptional scheme created in 2019 that has been made a permanent fixture in the French supplementary compensation landscape. This mechanism enables companies to pay an exceptional bonus to their employees under advantageous tax and social conditions.

The bonus exemption scheme is particularly attractive:
– Total exemption from social security contributions and income tax up to €3,000 for all employees
– Ceiling raised to €6,000 for companies with fewer than 250 employees that have set up a profit-sharing agreement.

Several conditions govern the payment of PPV:

• The company must be profitable for the year in question
• Only employees earning less than 3 SMIC are eligible.
• The bonus can be paid in one or more instalments during the year.

The popularity of this scheme continues to grow: in 2023, over 50% of French companies chose to pay this bonus, with an average amount of between €800 and €1,000 per beneficiary. As an added benefit, the PPV can be fully combined with profit-sharing schemes, making it an attractive part of a total compensation package.

In terms of timing, employers enjoy a certain degree of flexibility, since the payment can be made within 12 months of the end of the reference financial year, enabling optimized management of the company’s cash flow.

Transport allowance and sustainable mobility package

Since the 2009 law, employers have been legally obliged to cover at least 50% of their employees’ public transport costs for commuting to and from work. This measure constitutes a minimum base applicable to all companies, whatever their size.

In addition, the sustainable mobility package offers an ecological and economical alternative. This optional scheme enables employers to pay up to €700 per year per employee, fully exempt from social security contributions and taxes, to encourage the use of alternative modes of transport:

• Personal or self-service bicycles
• Carpooling (driver or passenger)
• Electric scooters and other personal mobility devices
• Car-sharing with electric, hybrid or hydrogen-powered vehicles
• Public transport (excluding season tickets already paid for)

One of the major advantages of this scheme is that it can be combined with the compulsory payment of public transport costs, up to an overall limit of €800 per year. This combination represents a significant lever for reducing the carbon footprint of business travel.

By 2023, around 25% of French companies had implemented the sustainable mobility package, demonstrating a gradual but steady uptake. To benefit from the tax and social security exemption, employers must collect supporting documents adapted to each mode of transport:
– Attestation sur l’honneur pour le vélo personnel
– Invoices d’abonnement pour les services de mobilité partagée
– Relevés de covoiturage provenant des plateformes dédiées

These schemes are part of a wider government initiative to decarbonize business travel. They are not only a financial advantage for employees, but also a concrete commitment by the company to the ecological transition, which can be promoted in its CSR policy.