In France, the Professional Future Law of September 5, 2018, amended the Employment Obligation of Disabled Workers with the aim of simplifying it and making it more effective. In addition, the Professional Future Law revised the legal regime for Adapted Companies, strengthened the right of disabled people to telework, and imposed the designation of a “disability” referent on companies with at least 250 employees. This LawFlash is a reminder that January 1, 2020, is the next deadline for compliance with certain of the law’s requirements.
Under French law, any employer, whether governed by public or private law, employing at least 20 employees is required to employ, on a full-time or part-time basis, disabled workers in a proportion of 6% of the company's total workforce. Institutions that do not (or only partially) fulfill this obligation must pay a contribution to the Association de Gestion du Fonds pour l'Insertion Professionnelle des Handicapés.
The Professional Future Law of 2018 amended the Obligation d’Emploi des Travailleurs Handicapés (OETH), requiring the following by January 1, 2020:
- Recognition of the status of a disabled worker will be granted definitively if a person's disability is considered irreversible. Currently, such recognition is granted for a period of one to five years.
- In multi-establishment companies, the OETH will no longer apply “establishment by establishment” but at the company level.
- The employer will only be able to fulfill its employment obligation by employing OETH beneficiaries, “regardless of the duration and nature of their contract,” or by paying an annual contribution to the development fund for the professional integration of the disabled for each of the beneficiaries of the obligation it should have employed.
- The current mechanisms for reducing the number of missing disabled workers “as part of the employer's efforts to maintain employment or directly recruit beneficiaries of the employment obligation” will be abolished.
- Companies with at least 250 employees must appoint a designated person to guide, inform, and support people with disabilities. This position is open to any voluntary employee who can attend a three-day training course called Référent Handicap, offered by the OETH association and in partnership with Cap Emploi.
- The extra-financial performance declaration (or extra-financial reporting), introduced by Ordinance No. 2017-1180 of July 19, 2017, and replacing the Corporate Social Responsibility (CSR) report, must include the measures the company has taken in favor of disabled people. The companies concerned by this declaration are
- listed companies where the net turnover exceeds 40 million euros or the balance sheet total exceeds 20 million euros and the average number of employees employed during the financial year exceeds 500; and
- unlisted companies where the balance sheet total or net turnover exceeds 100 million euros and the average number of employees employed during the financial year exceeds 500.
Finally, from January 1, 2019, to December 31, 2021, a new reason for using temporary work is being tested: the fact that the temporary employee is a beneficiary of the OETH. The government will report to Parliament on the impact of this experiment on access to employment for people with disabilities by June 30, 2021.
On May 27, 2019, the government issued three decrees concerning
- the mandatory declaration,
- approved agreements, and
- the calculation of the financial contribution.
These decrees will enter into force on January 1, 2020.
Any employer, even one with less than 20 employees, will have to identify each month, in its Déclaration Sociale Nominative (DSN), the information relating to the beneficiaries of the OETH it employs.
In addition, the Mandatory Declaration of Employment of Disabled Workers (Déclaration Obligatoire d’Emploi des Travailleurs Handicapés or DOETH) will, as of 2021, be drawn up via the DSN by establishments with at least 20 employees. As a reminder, the information contained in this declaration is confidential and may not be communicated to another employer from whom a beneficiary of the OETH seeks employment.
This declaration, excluding the list of beneficiaries of the OETH, will be made available to the Social and Economic Committee (CSE) in the Economic and Social Database (BDES) for the annual consultation on the company's social policy.
Article R. 130-1 of the French Social Security Code, which states that “the annual number of employees of the employer . . . corresponds to the average number of persons employed during each month of the previous calendar year” makes it possible to determine the annual number of employees to be taken into account for the liability to the OETH, as well as the number of OETH beneficiaries in the company.
Regardless of the duration and nature of their contract, employees, trainees, people undergoing training in a professional environment, temporary workers, and people seconded by employer groups must be taken into account in determining the number of employees.
It is important to note that the French Labour Code provides that for each beneficiary of the OETH aged at least 50 years, the number of disabled workers taken into account will be equal to 1.5 and not 1.
These calculations will be carried out by the competent French social security authority (URSSAF), using the information provided by the employer in the DSN.
Application of an Approved Agreement
A company, group, or branch agreement organising compliance with the OETH may be approved by the administration for a period of three years, renewable once, and must include
- a multiyear program including a hiring plan,
- a plan with objectives to maintain employment in the company, and
- provisional financing of the programmed actions.
The amount of funding must be at least equal, per year, to the amount of the annual contribution due for that year (including deductions). Failing this, the employer will pay the amount corresponding to the difference to the competent URSSAF.
The sums allocated to financing awareness-raising actions for the company's employees or steering and monitoring actions may not exceed one quarter of the total funding provided for in the agreement.
The most diligent party sends the agreement for approval to the competent administration (prefect for a company or group agreement, Minister of Employment for a branch agreement) by March 31 of the first year of implementation of the program at the latest.
The application of the agreement will have to be the subject of an annual review. For company or group agreements, the employer will present this report to the CSE or the group committee.
As a transitional measure, agreements approved before January 1, 2020, will continue to have effect until their expiry date, but may only be renewed once for a maximum period of three years, with the exception of establishment agreements, which may not be renewed.
Calculation of Financial Contribution for Noncompliance
In the event that a company does not reach the mandatory employment rate for disabled workers (i.e., 6%), it will have to pay an annual financial contribution. This contribution is calculated on the basis of the number of beneficiaries who should have been employed and the size of the company, and employers will be able, under certain conditions, to deduct certain expenses from this contribution.
The amount of the contribution is equal to the number of disabled workers benefiting from the missing obligation (hereinafter, the number A) multiplied by a fixed amount depending the size of the company.
The number A results from the difference between the number of beneficiaries of the theoretical OETH—calculated by multiplying the number of employees by the employment obligation rate (6%)—and the number of OETH beneficiaries employed.
The fixed amount is determined according to the number of employees subject to the company's liability, i.e.:
- 400 times the minimum hourly gross growth wage for companies with 20–249 employees
- 500 times the minimum hourly gross growth wage for companies with 250–749 employees
- 600 times the minimum hourly gross growth wage for companies with 750 or more employees
The decree also provides for the sanctioning of employers that do not employ any disabled workers for a period of more than three years by setting the fixed amount at 1,500 times the minimum hourly growth wage, regardless of the number of employees.
Employers will be able to deduct two types of expenses from this contribution:
- Expenditures incurred directly by the company in connection with supply, subcontracting, or service contracts it enters into with beneficiaries of the OETH (the amount of this deduction is limited to 30% of the price excluding tax of the supplies, works, or services included in the contract, from which are deducted the costs of raw materials, products, materials, subcontracting, intermediate consumption, and sales and marketing costs)
- Within the limit of 10% of the calculated amount of the contribution, expenses incurred directly by the company and intended to promote the living conditions of the beneficiaries of the OETH