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Mandatory Employer-Paid Medical Insurance In France: Syntec CBA
Companies in France that depend on the Syntec Collective Bargaining Agreement (CBA) must now apply the new medical insurance rules published on 24 December 2015.
This requirement applies to software, technological, engineering, and consulting companies in the service industry.From a payroll point of view, what matters most is the CBA mentioned on the employment agreement and payslips. You can find out if your company is included in the Syntec CBA by looking at these documents.
- What do I do if my company doesn’t have medical insurance yet?
Since 1 January 2016 all companies have been required to have a medical plan. Failure to provide medical insurance to staff can result in disputes. Your payroll administrator should be contacted asap if this plan is not already in place.
What do I do if my company already has medical insurance?
It’s imperative to assess the HR compliance and the tax compliance of your existing plan. Your existing plan needs to be adapted before 23 March 2016. In order to be regarded as a non-taxable benefit, there are several criteria:
1/National law compliance
The contract must comply with both new legal national requirements of “Contrat responsable” (legal cap on benefits) and “Panier de soins” (legal basic benefits) effective 1 January 2016. You should contact your insurer or broker to ask about these new compliance statuses. Where the contract is not compliant, it will need to be amended.
2/Syntec CBA compliance
The contract must be fully compliant with the new Syntec CBA requirements (published 24 December 2015). The compliance criteria cover:
- a: the benefits
If the benefits are lower than the new Syntec requirements, it is not compliant. You will need to ask your insurer to upgrade your contract to the new Syntec requirements.If the benefits are higher than the new Syntec requirements, it is ok, but you will need to issue a Decision Unilatérale Document, signed by the employer and the employee in order to make it tax compliant.
- b: the insurance premium rates
If the insurance premiums are lower than the new Syntec requirements, it is not compliant. You will need to ask your broker/insurer to upgrade your contract up to the new Syntec requirements.
If the premiums are higher than the new Syntec requirements, it is ok, but you will need to issue a Decision Unilatérale Document, signed by the employer and the employee in order to make it tax compliant.
- c: the insurance premium split
If the employer share of the premium is higher than the legal 50%, it is ok, but you will need to issue a Decision Unilatérale.
- d: the enrolment rules
Your enrolment rules will need to strictly comply with the new Syntec enrolment rules. You are not allowed to exempt an employee or an employee’s children for a reason which is not authorised by the Syntec rules. If your enrolment rules are different from the new Syntec enrolment rules, your entire plan will be taxable.
Failure to comply with the Syntec enrolment rules will cause the entire plan to be treated as a taxable benefit, and can also see you risk prosecution in the Labour court in an instance of litigation by an employee.
Your insurer or broker should be your primary point of contact for setting up a plan, or upgrading an existing plan and providing a “decision unilatérale” template if necessary.TMF Group France can also assist you in this process.