PLEASE NOTE:
Reduction in the Employer Unemployment Insurance Contribution: Impact on the Bonus-Malus System
In a circular published on May 1, 2025 (Circular No. 2025-05), Unédic clarified the consequences of the reduction in the employer unemployment insurance contribution on the modulation system (bonus-malus) that applies in certain sectors of activity (companies with 11 or more employees in 7 sectors).
As such, the increased or reduced contribution rate, valid until August 31, 2025, is lowered by 0.05 percentage points starting from May 1, 2025. In practice, this means that employers subject to the minimum or maximum rate may now benefit from an effective rate of 2.95% or 5%.
Effective Date of the New AT/MP Contribution Rates
Two decrees dated April 29, 2025, set the average costs, collective rates, and applicable surcharges for work accident and occupational disease (AT/MP) contributions, effective as of May 1, 2025, without retroactive effect.
In an announcement on April 30, 2025, GIP-MDS stated that personalized AT/MP contribution rates have been communicated to employers and their authorized representatives. These personalized rates are now accessible via employers' business accounts on the net-entreprises online portal.
Withholding Tax on Payroll: New Neutral Rate Tables Effective from May 1, 2025
As a reminder, employers are required to implement income tax withholding by applying the personalized rates provided by the tax authorities or, failing that, the so-called "neutral" rates, which are set annually by tables included in the General Tax Code.
Due to delays in the review of the 2025 Finance Act, the 2024 rates continued to apply at the beginning of 2025. The new default rate tables, resulting from the 2025 Finance Act, now apply to income received as of May 1, 2025 (Law 2025-127 of February 14, 2025, Art. 2, I-C and III).
FIGURES:
4% : this is the new employer unemployment insurance contribution rate.
The new unemployment insurance agreement dated November 15, 2024, reduced the standard employer contribution rate from 4.05% to 4%.
This reduction has been in effect for employment periods starting on or after May 1, 2025 (Unemployment Insurance Agreement of November 15, 2024, Art. 4 §1 and Art. 11 §3).
BOSS UPDATE:
On April 30, 2025, the Directorate of Social Security published several updates to the Official Bulletin of Social Security (BOSS), primarily concerning the update of the "T value" used to calculate the general reduction in employer social security contributions, effective from May 1, 2025.
This value has been revised to reflect changes in the rates of work accidents and occupational disease (AT/MP) contributions and unemployment insurance contributions as of that date.
The update also specifies that the kilometric allowance scales set by the tax administration remain unchanged in 2025.
WORK IN PROGRESS:
Employment of Seniors and Evolution of Social Dialogue: Presentation of the Bill Transposing the ANI Agreements to the Council of Ministers
As a reminder, on November 14, 2024, social partners concluded two interprofessional national agreements (ANI) regarding the employment of experienced employees (referred to as the ANI on senior employment). On May 7, 2025, Astrid Panosyan-Bouvet, Minister of Labor, presented to the Council of Ministers a bill aiming to transpose these ANIs into law, with its examination in Parliament scheduled to begin on June 4 in the Senate.
Among the measures included in the bill is the creation, on an experimental basis, of an "experience enhancement contract" with a 30% exemption on employer contributions to the retirement indemnity, as well as the possibility for senior employees, within the framework of a collective agreement, to transition to part-time work, using their retirement indemnity to maintain their salary starting from May 1, 2025 (Law 2025-127 of February 14, 2025, Art. 2, I-C, and III).
Public Service Contracts – Extension of Termination Deadlines for Public Insurance Contracts for Local Authorities
On April 28, 2025, a bill was introduced in the Senate to extend the termination deadlines for public insurance contracts for local authorities. Its sole article proposes adding a paragraph to Article L. 113-12 of the Insurance Code, allowing public entities to oppose, for reasons of public interest, an insurer's unilateral decision to terminate the insurance contract and to compel the insurer to continue fulfilling the contract for the strictly necessary duration required to carry out the process of awarding a new insurance contract, with this period not exceeding twelve months.
THE COURT HAS RULED:
Two-Year Prescription in Insurance Contracts: Interruption of Prescription May Extending a New Request When It Aims at the Same Goal
In a ruling issued on May 7, 2025, the second civil chamber of the Court of Cassation ruled that while the interruption of the prescription period generally cannot extend from one action to another, the situation is different when both actions aim at the same goal. In this case, after filing a claim for the payment of a permanent disability pension, the claimant made additional requests on appeal for the payment of a disability capital sum and supplementary daily indemnities.
The Court of Appeal noted that these new requests were made more than two years after the filing of the expert report, which marked the start of the two-year prescription period, and therefore ruled that these requests were time-barred.
The second civil chamber overturned the Court of Appeal's decision, arguing that the prescription had indeed been interrupted by the initial request, as the two subsequent actions were aimed at compensating for the same loss under the same insurance contract, and thus at the same goal (Cass. Civ. 2nd, May 7, 2025, No. 23-20.113).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
