In the context of the coronavirus epidemic, many companies have implemented or are planning to adopt partial activity measures for some or all of their employees. Verlingue is assisting companies in this sensitive context for both the company and their employees.
Is the company obliged to maintain supplementary social protection cover in the event of partial activity?
Yes, in accordance with the administrative doctrine, the company must maintain healthcare cost coverage and accident cover, as well as employer’s contributions, for employees in partial activity.
This obligation applies to all employees affected by partial activity measures, whether this involves a reduction in the number of hours worked or a total cessation of their activity.
If this coverage is not maintained, the company would be exposed to the risk of a reassessment notice from the French social security and family allowance contribution collection offices (URSSAF). It could even be exposed to the risk of self-insuring if an incident occurs, if, in addition to the URSSAF obligation, there is a labour law obligation to maintain the schemes (for example, if planned by a collective agreement).
(Sources: Circular DSS/5B/2009/32 of 30 January 2009 – sheet n° 7 / ACOSS circular letter n° 2011-036 of 24 March 2011 Q/R n° 48).
What bases should be used to calculate contributions and benefits?
As a general rule, insurance policies either propose a flat-rate contribution (the most common situation for policies covering Healthcare costs) or a contribution based on the remuneration actually paid.
For example, Accident cover policies often use the remuneration over the last 3 or 12 months subject to social security contributions as the basis for contributions. Moreover, Accident cover benefits are usually calculated symmetrically on the same basis as contributions.
This situation could create a problem: as the partial activity allowance is not subject to social security contributions, the mere reading of the contract could lead to having a contribution base, and consequently, guarantees, equal to zero.
Therefore, at the very least, contributions should be made on reduced wages and partial activity allowance.
However, contributing on the basis of 70% of the gross salary for all or part of an employee’s activity would actually result in a reduction in their Accident cover benefits. This would be the case, for example, for a compensable event (work stoppage or death) occurring in the 12 months following the period of partial activity. Therefore, recreating the contribution base, at the level of the normal salary, would allow the level of guarantees to be maintained.
Several specialist lawyers consider that recreating the contribution base could generate an URSSAF reassessment risk, in the assumption that not all employees are affected by the partial activity.
This risk could remain theoretical in the period we are currently experiencing, as public authorities are showing a willingness to make many measures more flexible (particularly in the context of ordinances).
Verlingue remains at your disposal should you require further information on these subjects.