Recovery plan, where are we?

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The recovery plan supported by the State and the Regions is still trying to stop the bleeding among French companies. Before playing its part in the economic recovery, it strives to breathe new life into the economic landscape. Official figures also reflect theunprecedented financial effort to save businesses. Solidarity fund, PGE, exemption from social contributions, partial activity, deferral of rents and bills for water, electricity and gas, simplification of direct loans by the State, refundable advance for SMEs… Millions of companies and employees have benefited from the support schemes. In total, the first six months already represent billions of euros disbursed by the State as well as the Regions.

The short-term decline in payroll taxes

Among the major actions of the government’s stimulus package, lower payroll taxes were at the heart of the concerns (1). Four main schemes were thus provided to allow the exemption of employer contributions, assistance in the payment of contributions, the plan to clear contributions with the USSRAF or the funds of MSA, and the partial remission of debts. In this context, some aid is only available for certain companies, depending on their sector of activity such as tourism; or the drastic drop in their turnover of more than 80%. To benefit, companies can apply to the October NSD.

In addition to these exemptions or deferral of charges, the State has set up a solidarity fund as early as March 2020. Dedicated to TPEs, independents, professionals (2), it is divided into two parts. The first component allowed companies to receive up to 1,500 challenges during the months of April, May and June.

As a result, an extension of aid was put in place for the most suffering sectors. In particular, it proposes to increase the amounts up to 10,000 euros per month under very strict conditions such as an administrative closure or the companies concerned by the tourism plan and the curfew (3).

Then, Part 2 took over to provide additional assistance of 2,000 to 5,000 euros. This second component is being paid by the Region. New Aquitaine, for example, contributes 38 million euros (4).

HR exemption from social charges and hiring aids for the stimulus package
The social security measures of the stimulus package could be extended as much as necessary. Just like partial activity or hiring aids.

From partial activity to hiring support

In addition to these actions to reduce payroll taxes, other stimulus packages were quickly put in place to preserve employment. For example, in April, May and June, partial activity amounted to EUR 19.5 billion. It then covered up to 8.8 million employees during the confinement in April. As of November 1st, conditions and solutions are changing, but the use of partial activity is still relevant. Partial activity under common law, partial activity reserved for the hardest-hit sectors, long-term partial activity… each situation has its most appropriate solution. The long-term partial activity in particular can run until June 30, 2022. To offer wider solutions to businesses, the traditional partial activity scheme is also extended. Limited to 12 months, it can since November 1st is renewed for three months themselves renewable.

In any case, through this aid, the State intends not only to put a band-aid on it, but also to keep employment in the run-up to the recovery. The aim is to avoid economic redundancies at all costs.

In addition to partial activity, the State also engages with companies that can continue to work, to enable them to recruit new skills. Particularly affected by the crisis, youth employment is at the heart of the hiring assistance schemes offered. Assistance of 4000 euros for the signing of a CDI or CDD of more than three months for under 26s; aid of 5,000 to 8000 euros for apprenticeship and professionalisation contracts; contracts helped in the merchant sector; Skills courses for non-market sectors; territorial volunteering in business…

New Aquitaine also stands with its industries. As part of the recovery plan, it proposes a subsidy equal to 50% of the gross salary charged to an employee over a year, up to a maximum of 40,000 euros. As well as a grant that can reach up to 70% of the training costs and the cost of the staff participating in the training (trainers, auditors). (5)

Sources

  1. Walter France press release, “News of the recovery plan”, 23 October 2020
  2. “Solidarity Fund for TPEs, independents and micro-entrepreneurs: aid of up to 1,500 euros”, Economy.gouv
  3. Section 1 of the TPE Solidarity Fund, BPI France
  4. Solidarity Fund dedicated to TPEs: Part 2, BPI France
  5. “Recruitment and Skills Building Industrial Performance”, The Guides Helps in New Aquitaine
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