French Labour Law

Apprenticeship in France: New 50% SMIC Contribution Exemption from March 2025

DAIRIA Law · 2026-06-30 · 12 min

Apprenticeship in France: New 50% SMIC Contribution Exemption from March 2025

Introduction: A Major Reform in the Social Framework of Apprenticeship

The social framework of apprenticeship underwent a significant transformation with the implementation, as of March 1, 2025, of a new exemption threshold for employee contributions reduced to 50% of the SMIC (Salaire Minimum Interprofessionnel de Croissance – Minimum Interprofessional Wage). This measure, provided for in the Social Security Financing Law for 2025 (LFSS 2025) and detailed by the corresponding decree, profoundly alters the calculation of apprenticeship costs for employers and directly impacts apprentices’ payslips.

For payroll managers, human resources directors, and accountants, this reform requires immediate updates to payroll settings and a thorough understanding of the new applicable rules. This article provides a detailed analysis of the changes, their practical implications on payslips, and critical points to monitor to secure the processing of apprentices’ remuneration.

1. Recap of the Previous System: 79% SMIC Exemption

1.1 The Historical Principle of Employee Contribution Exemption

Prior to March 1, 2025, apprentices benefited from a total exemption from employee contributions, including CSG (Contribution Sociale Générale) and CRDS (Contribution au Remboursement de la Dette Sociale), on the portion of their remuneration not exceeding 79% of the gross monthly SMIC. This threshold, set by Article L. 6243-2 of the Labour Code in its previous wording, aimed to ensure that apprentices’ net pay remained as close as possible to their gross pay.

In practice, for a gross monthly SMIC of €1,801.80 as of January 1, 2025 (based on a 35-hour work week), the exemption threshold was calculated as €1,801.80 × 79% = €1,423.42. Since nearly all apprentices earn below this threshold, the exemption covered their entire remuneration in the vast majority of cases.

1.2 A Particularly Beneficial System

This 79% SMIC exemption regime had the advantage of simplicity: for most apprentices, gross pay equaled net pay (excluding mandatory health insurance when applicable). Only older apprentices (aged 26 and above, earning at 100% of the SMIC or the applicable minimum salary convention) or those in their third year of apprenticeship could see their remuneration exceed the threshold and thus be subject to employee contributions on the excess portion.

2. The New Regime: Reduction of the Threshold to 50% SMIC

2.1 Effective March 1, 2025

The LFSS 2025 amended Article L. 6243-2 of the Labour Code to lower the employee contribution exemption threshold from 79% to 50% of the gross monthly SMIC. The implementing decree, published in the Official Journal, established the effective date as March 1, 2025.

The new threshold is therefore set at €1,801.80 × 50% = €900.90 (based on the SMIC as of January 1, 2025). This threshold applies monthly and must be prorated in cases of part-time work, absence, or incomplete months.

2.2 Scope of the Reduction

The reduction of the threshold has the direct effect of significantly broadening the base subject to CSG and CRDS for apprentices. Indeed, remuneration exceeding 50% of the SMIC will now be subject to the following contributions:

  • CSG at a rate of 9.20% (6.80% deductible and 2.40% non-deductible);
  • CRDS at a rate of 0.50% (non-deductible).

Thus, the total contributions amount to 9.70% on the portion of remuneration exceeding 50% of the SMIC. The CSG/CRDS base is calculated on 98.25% of the remuneration (applying the 1.75% deduction for professional expenses), within the limit of four annual ceilings of the Social Security.

2.3 Employee Contributions Other Than CSG/CRDS

It is important to specify that the exemption from employee contributions (health insurance, retirement, unemployment) remains applicable within the limit of 50% of the SMIC. Beyond this threshold, standard employee contributions theoretically become payable. However, in practice, CSG and CRDS constitute the most significant impact for apprentices, with other employee contributions generally remaining limited across most remuneration configurations.

3. Impact on Apprentices’ Remuneration Scale

The minimum remuneration for apprentices is set as a percentage of the SMIC (or the more favorable minimum conventional salary) based on the apprentice’s age and the year of execution of the contract. The applicable scale for 2025 is as follows:

Apprentices aged 16-17:

  • 1st year: 27% of SMIC (€486.49)
  • 2nd year: 39% of SMIC (€702.70)
  • 3rd year: 55% of SMIC (€990.99)

Apprentices aged 18-20:

  • 1st year: 43% of SMIC (€774.77)
  • 2nd year: 51% of SMIC (€918.92)
  • 3rd year: 67% of SMIC (€1,207.21)

Apprentices aged 21-25:

  • 1st year: 53% of SMIC (€954.95)
  • 2nd year: 61% of SMIC (€1,099.10)
  • 3rd year: 78% of SMIC (€1,405.40)

Apprentices aged 26 and above:

  • All years: 100% of SMIC (€1,801.80)

3.2 Identification of Affected Apprentices

With the new threshold set at 50% of the SMIC (€900.90), apprentices whose remuneration exceeds this amount will now be subject to CSG/CRDS on the excess portion. Those directly affected include:

  • 16-17 year olds in the 3rd year (55% of SMIC = €990.99);
  • 18-20 year olds from the 2nd year onward (51% of SMIC = €918.92);
  • 21-25 year olds from the 1st year onward (53% of SMIC = €954.95);
  • Apprentices aged 26 and above (100% of SMIC = €1,801.80).

Conversely, apprentices aged 16-17 in the 1st year (27% = €486.49) and 2nd year (39% = €702.70), as well as apprentices aged 18-20 in the 1st year (43% = €774.77), remain fully exempt as their remuneration is below 50% of the SMIC.

4. Concrete Impact on Payslips

4.1 Numerical Example: 21-Year-Old Apprentice in 2nd Year

Let us take the example of a 21-year-old apprentice in their 2nd year, earning 61% of the SMIC, which amounts to €1,099.10 gross monthly.

Before March 1, 2025 (threshold at 79% of SMIC = €1,423.42):

  • Gross remuneration: €1,099.10
  • Remuneration below the 79% threshold → total exemption
  • Net to pay: €1,099.10

Since March 1, 2025 (threshold at 50% of SMIC = €900.90):

  • Gross remuneration: €1,099.10
  • Exempt portion: €900.90
  • Portion subject to CSG/CRDS: €1,099.10 – €900.90 = €198.20
  • CSG/CRDS base (after 1.75% deduction): €198.20 × 98.25% = €194.73
  • CSG: €194.73 × 9.20% = €17.92
  • CRDS: €194.73 × 0.50% = €0.97
  • Total withheld: €18.89
  • Net to pay: €1,080.21

Thus, the net loss for the apprentice amounts to €18.89 per month, equivalent to approximately €227 per year.

4.2 Numerical Example: Apprentice Aged 26 and Above

For an apprentice aged 26 and above, earning 100% of the SMIC, which amounts to €1,801.80 gross monthly, the impact is significantly more pronounced:

  • Portion subject: €1,801.80 – €900.90 = €900.90
  • CSG/CRDS base: €900.90 × 98.25% = €885.13
  • CSG + CRDS: €885.13 × 9.70% = €85.86
  • Monthly net loss: €85.86, equivalent to approximately €1,030 per year.

This impact is far from negligible for older apprentices and constitutes a major point for HR departments when informing apprenticeship candidates.

5. Employer Contributions: General Reduction Applicable

5.1 Common Law Calculation

From the employer’s side, contributions on apprentices’ remuneration are subject to the common law regime. The general reduction of employer contributions (referred to as the “Fillon reduction”) applies under the same conditions as for other employees. The reduction coefficient is calculated based on the ratio of annual gross remuneration to the annual SMIC, using the standard formula.

5.2 Impact on Total Apprenticeship Costs

The general reduction significantly lowers the employer’s cost associated with apprenticeship, particularly for apprentices whose remuneration is close to the SMIC. The calculation of the reduction coefficient takes into account the actual remuneration of the apprentice (rather than a reconstructed remuneration), leading to a high coefficient for the lowest paid apprentices.

For companies with fewer than 50 employees, the maximum coefficient of the general reduction reaches 0.3194 (2025 value), allowing for substantial reductions in employer contributions. For companies with 50 employees and above, the maximum coefficient is 0.3234 (including the FNAL contribution at the increased rate).

6. Apprentice Hiring Aid in 2025

6.1 Maintenance of the €6,000 Aid

The aid for hiring apprentices, set at €6,000 for the first year of contract execution, is maintained in 2025. This aid is paid monthly (€500 per month over 12 months) and applies to all apprenticeship contracts concluded between January 1 and December 31, 2025, without regard to the size of the company or the level of diploma pursued.

6.2 Eligibility Conditions

To qualify for the aid, the employer must:

  • Enter into an apprenticeship contract between January 1 and December 31, 2025;
  • Submit the contract to the relevant skills operator (OPCO) within the regulatory deadlines;
  • Provide the monthly DSN (Déclaration Sociale Nominative) to enable automatic payment of the aid by the ASP (Agence de services et de paiement).

The aid is cumulative with the social contribution exemptions applicable to apprentices. It covers a significant portion of the salary cost of the apprentice in the first year, making apprenticeship financially attractive despite the reform of the exemption threshold.

7. Specific Cases in the Public Sector

7.1 Specific Exemption Maintained

Employers in the public non-industrial and commercial sector benefit from a specific exemption regime for apprentices, distinct from the common law regime. This regime, provided by Article L. 6227-8-1 of the Labour Code, allows for a total exemption from employer contributions (excluding additional public service retirement contributions) and is retained unchanged by the LFSS 2025.

7.2 Relation to the New Threshold

The reduction of the employee contribution exemption threshold to 50% of the SMIC also applies to apprentices in the public sector. However, the specific exemption regime for employer contributions remains unchanged, maintaining an advantage for public employers compared to common law.

8. Impacts on DSN

8.1 Declaration of Employee Contributions

The implementation of the new threshold requires adjustments to DSN settings. Payroll software providers have had to update calculation rules to differentiate the exempt portion (up to 50% of the SMIC) from the portion subject (above 50% of the SMIC). Specific personnel type codes (CTP) for apprentices must be accurately reported to avoid any reporting anomalies.

8.2 Points of Vigilance

Payroll managers must be particularly vigilant regarding the following points:

  • The prorating of the threshold in case of an incomplete month (hiring or termination during the month);
  • The prorating of the threshold in cases of part-time work;
  • Managing the transitional period (before and after March 1, 2025 within the same month of March);
  • The correct assignment of CTPs on contribution blocks in the DSN;
  • Verifying the CSG/CRDS rates applied (9.20% + 0.50% on the base after deduction).

9. Impact Analysis: A Paradigm Shift for the Attractiveness of Apprenticeship?

9.1 A Net Additional Cost for the Apprentice

The lowering of the exemption threshold represents a decrease in purchasing power for apprentices earning more than 50% of the SMIC. Although the impact is moderate for younger and less experienced apprentices, it can be significant for those aged 26 and above, with a net loss exceeding €1,000 annually.

9.2 A Political Signal to Monitor

This measure fits within a context of seeking revenue for the financing of Social Security. It reflects a desire to rationalize social exemptions by targeting them more towards the most vulnerable populations. Employers’ organizations and professional branches have expressed concerns about the potentially negative impact on the engagement with apprenticeship programs, especially regarding adult populations undergoing professional retraining.

9.3 The Continuation of the €6,000 Aid as a Counterbalance

The maintenance of the €6,000 hiring aid in 2025 serves as an important compensatory factor for employers. This aid, combined with the general reduction of employer contributions, allows for the overall net cost of employing apprentices to remain attractive, despite the increasing gross cost associated with the new employee contribution regime.

FAQ – Frequently Asked Questions About the New Apprenticeship Exemption Threshold

Does the new 50% threshold apply to ongoing contracts or only to new contracts?

The new 50% SMIC threshold applies to all ongoing apprenticeship contracts from March 1, 2025, and not just contracts concluded after this date. This is a modification of the social regime applicable by right, without any conditionality regarding the contract’s conclusion date. Payroll managers must therefore update the processing of all apprentices’ payslips starting with the March 2025 payroll.

How to manage payroll in March 2025, straddling the old and new regime?

For March 2025, two methods are feasible: either a prorated application (the old threshold for the period from February 1 to 28, and then the new threshold from March 1) or applying the new threshold for the entire month. The BOSS (Base de Données Sécurisée) and ministerial instructions recommend applying the new threshold for the entire month of March 2025 for simplification reasons. Employers should refer to their payroll provider’s guidelines.

Is the exemption from employer contributions specific to apprentices modified?

No, the reform exclusively concerns the exemption threshold for employee contributions. The regime of employer contributions remains unchanged: the general reduction of employer contributions (Fillon reduction) remains applicable under the same conditions as before. Employers continue to benefit from a significant reduction in employer charges on apprentices’ remuneration.

What impact does this have on apprentices’ mandatory health insurance?

The employee’s share of mandatory health insurance contributions is not modified by the exemption threshold reform. The employee health insurance premium remains due under the same conditions as before. However, apprentices whose share of health insurance contributions exceeds 10% of their gross remuneration may request an exemption from affiliation. This provision remains unchanged and can be particularly relevant for younger apprentices whose remuneration is lower.

Is the €6,000 hiring aid affected by this reform?

No, the €6,000 apprenticeship hiring aid is entirely independent of the employee contributions regime. It remains unchanged in 2025 for all apprenticeship contracts, without regard to company size or diploma level. The disbursement of the aid continues to be made monthly by the ASP, based on the data transmitted in the DSN by the employer.

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