- 04 May 2018
- Dorothée David
Salary payments in the event of illness: new applicable rules
The Law of 8 April 2018 modifying various provisions of the Labour Code came into force on 15 April 2018. Among other things, it modifies the provisions of article L. 121-6 (3) of the Labour Code about the payment of salaries in the event of illness. From now on, to make sure an employee who is on sick leave is entitled to “full pay”, the employer must follow these rules:
If employees who are unwell did have their work schedule at least until the end of the calendar month covering the inability to work, the employer must pay:
- the basic salary for the month in question + all standard bonuses and additional current payments, as well as increases that the employees would be entitled to if they had worked their expected working hours for the period during which they were unable to work.
If employees who are unwell did not have their work schedule at least until the end of the calendar month covering the inability to work, the employer must pay:
- a daily allowance = average daily salary for the 6 months immediately before the illness.
For employees who are paid according to performance or on a piece-work basis or whose salary is set as a percentage, according to the turnover, or subject to significant variations, the average salary for the previous 12 months is used as the basis for calculating the daily allowance to pay. Furthermore, if employees have been at the company for less than 6 months or 12 months respectively, the reference period must be reduced to the length of time they have actually been at the company.
The daily allowance is calculated as follows:
- Average daily salary = (gross monthly salary / 173*) x the number of hours worked per day.
- Taking into account permanent salary increases introduced by law, the applicable collective agreement or the employment contract, occurring during the reference period or during the illness.
- Excluding non-periodic benefits, bonuses and performance bonuses, incidental expenses incurred by the work and overtime hours.
- Periods of leave, sick leave, short-time working, inability to work due to bad weather or accidental or involuntary technical unemployment during the reference periods of 6 or 12 months are exempt.
* or normal number of hours of work per month as stipulated in the collective agreement or the applicable employment contract.
These new legal rules mean that the majority of case law on this issue can be abandoned, according to which the employer had to take into account overtime and overnight work, bank holidays or Sundays if employees had regularly or structurally carried out such hours before they were unable to work, over an undefined period of several months, which had to be established in the event of a dispute.
From now on, the employer must distinguish between whether or not employees have received their working hours before falling ill. If so, employees must be paid as though they had worked according to the predefined timetable on the days they were ill. If not, they will receive a daily allowance corresponding to the average daily salary for the last six months (if applicable), which will in particular not take into account any overtime worked during this period.
This subject will be covered by an article in L’Agefi due to be published in May 2018.