Since 1 January 2018, an employer has been able to grant its employees a cash bonus based on part or all of the profits of the financial year (the so-called “profit bonus”). This profit bonus enjoys attractive social and tax benefits.

There are two types of profit bonus:

- the “same profit bonus”, which is a profit bonus that is the same for all employees or is calculated as a fixed percentage of the employee’s remuneration;

- the “categorized profit bonus”, which is a profit bonus granted to all employees, based on a granting key, which is applied according to objective criteria.

The total amount of the profit bonus cannot exceed 30% of the total gross remuneration amount (at the end of the financial year). The profit bonus cannot be used to replace or convert existing remuneration, bonuses or benefits.

Several modifications to the profit bonus system entered into force on 1 January 2019.

First, the employer can now calculate the amount of the profit bonus according to the number of hours worked by the employees during the previous financial year. This new provision allows the employer to grant a reduced profit bonus to employees:

- who worked part-time in that financial year;

- whose employment contract was suspended for certain periods during that financial year.

However, certain periods of suspension (of the employment contract) must be treated as actual work, such as periods during which the employee retains his right to remuneration (first 30 days of incapacity, annual holiday, etc.), periods of maternity/paternity leave, etc.

Second, the employer now has the option not to grant a profit bonus to employees:

- who were dismissed for serious cause during the previous financial year;

- who voluntarily left the company during that financial year (except when they resigned for serious cause).