When it comes to working situations, every single person’s situation is different. From digital nomads travelling around the globe, to freelancers with a permanent base and those seeking out seasonal or year around work opportunities abroad.
Whilst this applies everywhere, it’s particularly applicable in holiday destinations, like our base in The Alps. We’re in constant communication with individuals seeking out unique work opportunities - and managing the pile of paperwork that comes with that choice (thanks, Brexit).
This blog is focused around working on either a contractual basis or under self-employed status in France - if you fit into one of those categories or see yourself transitioning to a new way of work in the future, keep reading…
Work contracts in France
The logistics of being on a work contract in France look different depending on what type of contract you’re on. The two types we’ll be discussing today are called CDI and CDD work contracts. In seasonal resorts (like Meribel, France), many seasonal workers find themselves on CDD saisonnier contracts. Whilst there are slight differences between CDD and CDD Saisonnier, essentially both mean they’re on a contract for a fixed period. There are many benefits that come with being on a CDD contract - one of which is that once your CDD is complete, you can sign onto unemployment benefits and receive unemployment allowances (if you have contributed to the system enough). For more information on who’s entitled to the allowances (Chomage), please visit our relevant Pole Emploi article. Secondly, CDD contracts give you the flexibility to have job stability doing what you love on a seasonal basis - a win-win for those in hospitality (as an example) who like to explore the mountain playground in the winter and relax working in beachside paradise during the summers.
CDI contracts, on the other hand, are long-term contracts with no predicted end date - the holy grail of work contracts in France. With them comes job security, guaranteed pay, access to unemployment allowances and the ability to purchase a property or get a bank loan (once the trial period of your contract is over of course).
It’s important to note that CDI and CDD work contracts cost the employer a lot - as a rule of thumb, your employer will pay the 22% social charges on your gross salary as well as their employer’s contribution which amounts to 55% of the net salary. Whilst this can result in a lower hourly pay rate, many prefer the job security and guaranteed income levels over slightly lower hourly rates (a mindset we can very much see the benefit in).
Being self-employed in France
Being self-employed in France comes with its own set of positives and negatives. One notable positive is the freedom of self-employed work - the autonomy over your own time and the ability to choose your own clients. Freelancers also generally charge much higher rates due to the client having no additional costs, which means working less for more money - an undeniable perk.
With this being said, alongside higher pay rates comes the awful task of having to pay your own social charges - as a self-employed individual you must pay 22% of everything you earn in social charges and because you work for yourself, you’ll have to do this manually and save the money as it comes in (no easy task).
Of course, with the freedom of choosing when you work, comes the lack of guaranteed work. If you’re working seasonally and there happens to be a world crisis (like a pandemic), clients may re-prioritise and there’s the risk you may lose your income stream. Frustratingly, whilst self-employed individuals do contribute via their social charges, they cannot claim job seekers' allowance because (of course) they are not job seekers in the traditional sense. If you shut down your micro-entrepreneur status you can then claim chomage - but not whilst your status is active.
Lastly, if you’re planning to buy a house or require a loan for a new car any time soon - remember that as a self-employed person the banks will ask for proof of steady income over the past three years. This is an important point to consider if you’re pondering whether to take the leap.
The mystery of disguised employment
If this is a new term for you - disguised employment is when workers perform employee duties, except they’re being misclassified as self-employed workers or contractors. It's when an employer is essentially hiring an individual to be part of the team, except they’re ensuring the individual maintains their self-employed status, which results in the employer avoiding paying their contribution (meaning it’s overall a cheaper option for them despite likely paying a higher hourly rate to the freelancer). It can be difficult to identify this type of employment, particularly as many self-employed individuals have consistent and positive relationships with their clients.
The best way of identifying disguised employees is figuring out if there's a 'lien de subordination'. This translates to ‘the difference between working 'for' someone and working 'with' someone’. When you work for an employer, they give you instructions, they control your working life and there are serious repercussions if the work isn’t completed to standard. When you work with someone (as a self-employed person or contractor) you are helping with specific tasks within your area of expertise and the work is completed on your own schedule. The work is then paid for, and handed over. You can see the difference.
Now, when the lien de subordination isn’t clear it may be necessary to prove that the self-employed person is truly self-employed. There are multiple things that raise red flags:
When the self-employed individual only has one client; and,
When the cash flow is consistent.
With this being said, the onus is on the employer, and the law doesn’t state that a self-employed person must have multiple clients. However, the general advice is to have at least 3 clients over the year. Having multiple streams of income remains an easy way to prove you’re not a disguised employee.
Until next time…
We hope you found some useful information here that in some capacity or another you can relate to in your personal working world. For more information on what visa you may need, please visit our ‘Work. Visas. Brexit. A big mess’ blog.