The employment status of a company manager in France depends on the legal structure of the company. Currently, there are two types of employment statuses for company managers: assimilated employee (assimilé salarié) and non-salaried worker (travailleur non salarié or TNS). Assimilated employees are covered by the general social security system and enjoy better employment protections than non-salaried workers. This article outlines the assimilated employee status, including social security coverage and contribution rates, advantages, disadvantages, and more.
What’s in this article?
- What is an assimilated employee?
- Who qualifies as an assimilated employee?
- What employee benefits does an assimilated employee receive?
- Does an assimilated employee receive compensation?
- What are the advantages and disadvantages of assimilated employee status?
- What are the alternatives to assimilated employee status?
What is an assimilated employee?
A manager who qualifies as an assimilated employee is one who is covered by the general social security system. An assimilated employee enjoys protections similar to those of a traditional employee, particularly with regard to health, pension and social security schemes. An assimilated employee also has better social security coverage than a self-employed person (TNS).
Who qualifies as an assimilated employee?
In France, managers who qualify as assimilated employees include:
- Minority or equal shareholder managers of limited liability companies (SARLs). This means the managers hold up to 50% of the companies’ shares.
- Non-partner managers of single-owner limited liability companies (EURLs).
- Chairpersons on the board of directors and chief executive officers (CEOs) of public limited companies (SAs).
- Presidents of simplified joint stock companies (SASs) and single-shareholder simplified joint-stock companies (SASUs).
What employee benefits does an assimilated employee receive?
In exchange for the contributions paid to Urssaf (the organisation responsible for collecting social security contributions), a manager who is considered an assimilated employee is entitled to several employee benefits, including:
- Sickness and parental leave insurance
- Old-age insurance (basic and supplementary pensions)
- Disability and death insurance
- Family allowances
- Vocational training
- General social contribution (CSG) and contribution for the repayment of social debt (CRDS)
Please note: to be eligible for unemployment insurance, a company manager classified as an assimilated employee must have an employment contract and a direct subordinate relationship.
Does an assimilated employee receive compensation?
Compensation for a manager who qualifies as an assimilated employee is freely determined by the company’s shareholders during a general meeting. Social security contributions are calculated each month on the basis of gross compensation. The company is responsible for paying the contributions due to Urssaf each month, which usually amount to approximately 62% of the executive’s compensation.
If there is no compensation, the assimilated employee does not pay social security contributions and consequently does not benefit from employee protection. In contrast, TNS managers are required to pay minimum social security contributions even if they do not receive any remuneration.
You can compare the social security contribution rates for assimilated employees and self-employed persons in 2024 as published by the Banque Publique d’Investissement.
What are the advantages and disadvantages of assimilated employee status?
The status of assimilated employee offers several advantages for a company manager, including:
- Comprehensive employee protection. TNS managers, on the other hand, require additional insurance to increase their employee protection.
- Dividends received as a partner are not subject to social security contributions.
- A 10% rebate on taxable income.
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Assimilated employee status also has drawbacks, however – particularly for the company. These include:
- More expensive social security coverage than a TNS
- Burdensome administrative process (e.g., generating pay slips for the salaried manager and submitting social security contributions online each month)
- Employment contract required to qualify for unemployment insurance
What are the alternatives to assimilated employee status?
TNS status is the only alternative to assimilated employee status. It is reserved for self-employed persons engaged in commercial, craft, or liberal professions (such as a sole proprietorship or El) and certain company managers. These managers include:
- SARL majority shareholders (i.e., those holding more than 50% of the company’s shares)
- EURL sole shareholders who are also managers of their companies
- General partnership (SNC) managers and partners
You can find out more about non-salaried worker (TNS) status in our article on the subject.
The content in this article is for general information and education purposes only and should not be construed as legal or tax advice. Stripe does not warrant or guarantee the accuracy, completeness, adequacy, or currency of the information in the article. You should seek the advice of a competent lawyer or accountant licensed to practise in your jurisdiction for advice on your particular situation.