French Labour Law

Apprenticeship: New Exemption Threshold at 50% of SMIC Effective March 2025

DAIRIA Law · 2026-07-07 · 12 min

Apprenticeship: New Exemption Threshold at 50% of SMIC Effective March 2025

Introduction: A Major Reform of the Apprenticeship Social System

The apprenticeship social system is undergoing a significant transformation with the introduction of a new threshold for the exemption from employee contributions, reduced to 50% of the minimum wage (SMIC), effective March 1, 2025. This measure, set forth by the 2025 Social Security Financing Law (LFSS 2025) and specified by an implementing decree, fundamentally alters the calculation of the cost of apprenticeship for businesses and directly impacts apprentices’ payslips.

Payroll managers, human resources executives, and accountants will need to immediately update payroll settings and thoroughly understand the new applicable rules. This article provides an in-depth analysis of the changes made, their practical consequences on payslips, and the critical points to monitor to ensure the accurate handling of apprentices’ remuneration.

1. Reminder of the Previous System: Exemption at 79% of SMIC

1.1 The Historical Principle of Employee Contribution Exemption

Before March 1, 2025, apprentices benefited from a total exemption from employee contributions, including the General Social Contribution (CSG) and Contribution for the Repayment of Social Debt (CRDS), on the portion of their remuneration not exceeding 79% of the gross monthly SMIC. This threshold, established by Article L. 6243-2 of the Labour Code in its previous version, aimed to ensure that apprentices’ net remuneration was as close as possible to their gross remuneration.

Specifically, with a gross monthly SMIC of €1,801.80 as of January 1, 2025 (based on a 35-hour workweek), the exemption threshold was calculated at €1,801.80 × 79% = €1,423.42. Since nearly all apprentices received remuneration below this threshold, the exemption covered the entirety of their remuneration in the vast majority of cases.

1.2 A Particularly Favorable Regime

This 79% SMIC exemption regime had the advantage of simplicity: for most apprentices, the gross pay equaled the net pay (excluding mandatory health insurance, if applicable). Only older apprentices (aged 26 and above, remunerated at 100% of the SMIC or the conventional minimum salary) or those in their third year of training could have their remuneration exceed the threshold and consequently be subject to employee contributions on the excess amount.

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

2.1 Effective Date of March 1, 2025

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

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

2.2 Scope of the Reduction

The reduction of the threshold will directly lead to a considerable expansion of the base subject to CSG and CRDS for apprentices. Indeed, beyond 50% of the SMIC, the remuneration of the apprentice is now subject to the following deductions:

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

Thus, the total deductions 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 a 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 clarify that the exemption from employee contributions (health insurance, pensions, unemployment) continues to apply up to 50% of the SMIC. Beyond this threshold, standard employee contributions, in theory, become due. However, in practice, it is primarily the CSG and CRDS that represent the most significant impact for apprentices, as other employee contributions remain limited in most remuneration configurations.

3. Impact on Apprentices’ Remuneration Structure

The minimum remuneration for apprentices is set as a percentage of the SMIC (or the higher conventional minimum salary) based on the age of the apprentice and the year of contract execution. 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 Over:

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

3.2 Identification of Impacted Apprentices

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

  • Apprentices aged 16-17 in their 3rd year (55% of SMIC = €990.99);
  • Apprentices aged 18-20 as early as their 2nd year (51% of SMIC = €918.92);
  • Apprentices aged 21-25 starting in their 1st year (53% of SMIC = €954.95);
  • Apprentices aged 26 and over (100% of SMIC = €1,801.80).

Conversely, apprentices aged 16-17 in their 1st year (27% = €486.49) and 2nd year (39% = €702.70), as well as apprentices aged 18-20 in their 1st year (43% = €774.77), remain fully exempted 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’s consider the example of a 21-year-old apprentice in their 2nd year, earning 61% of the SMIC or €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 be paid: €1,099.10

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

  • Gross remuneration: €1,099.10
  • Exempt amount: €900.90
  • Amount subject to CSG/CRDS: €1,099.10 – €900.90 = €198.20
  • CSG/CRDS base (after 1.75% allowance): €198.20 × 98.25% = €194.73
  • CSG: €194.73 × 9.20% = €17.92
  • CRDS: €194.73 × 0.50% = €0.97
  • Total deducted: €18.89
  • Net to be paid: €1,080.21

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

4.2 Numerical Example: Apprentice Aged 26 and Over

For an apprentice aged 26 and over, earning 100% of the SMIC or €1,801.80 gross monthly, the impact is much more significant:

  • Amount 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, or approximately €1,030 per year.

This impact is notably significant for older apprentices and represents a major point of consideration for HR departments when informing apprenticeship candidates.

5. Employer Contributions: General Reduction Applicable

5.1 Standard Calculation

From the employer’s perspective, employer contributions on apprentice remuneration are governed by the standard regime. The general reduction of employer contributions (known as the “Fillon Reduction”) is applicable under the same conditions as for other employees. The reduction coefficient is calculated based on the ratio between the annual gross remuneration and the annual SMIC, according to the usual formula.

5.2 Impact on the Overall Cost of Apprenticeship

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

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

6. Employment Assistance for Apprentices in 2025

6.1 Maintenance of the €6,000 Assistance

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

6.2 Eligibility Criteria

To qualify for the assistance, the employer must:

  • Conclude an apprenticeship contract between January 1 and December 31, 2025;
  • Submit the contract to the skills operator (OPCO) within the regulatory deadlines;
  • Transmit the monthly DSN allowing the automatic payment of assistance by the ASP (Agency for Services and Payment).

The assistance is cumulative with the applicable social contribution exemptions for apprentices. It helps cover a significant portion of the salary cost for the apprentice in the first year, making apprenticeship financially very attractive despite the reform of the exemption threshold.

7. Specific Case of 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 standard regime. This regime, set forth by Article L. 6227-8-1 of the Labour Code, provides a total exemption from employer contributions (excluding additional pension contributions under public service) and is maintained unchanged by the LFSS 2025.

7.2 Interaction with 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, thus maintaining an advantage for public employers over the common law.

8. Impacts on DSN

8.1 Reporting Employee Contributions

The implementation of the new threshold requires an adaptation of DSN (Déclaration Sociale Nominative) settings. Payroll software providers must update calculations to distinguish between the exempt portion (up to 50% of SMIC) and the portion subject (beyond 50% of SMIC). The specific personnel type codes (CTP) for apprentices must be accurately filled out to prevent any reporting anomalies.

8.2 Points of Vigilance

Payroll managers must pay particular attention to the following points:

  • The prorating of the threshold in cases of incomplete months (hiring or departure in progress 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);
  • Proper allocation of CTP on the contributions blocks in DSN;
  • Verification of the applicable CSG/CRDS rates (9.20% + 0.50% on the base after deduction).

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

9.1 A Net Increase in Costs for Apprentices

The reduction of the exemption threshold represents a decrease in purchasing power for apprentices whose remuneration exceeds 50% of the SMIC. Although the impact is moderate for younger and less experienced apprentices, it can be significant for apprentices aged 26 and older, for whom the net loss exceeds €1,000 per year.

9.2 A Political Signal to Monitor

This measure is part of a broader context of seeking revenue for financing social security. It reflects a desire to rationalize social exemptions by targeting them more towards the most vulnerable populations. Employer organizations and professional branches have expressed concerns about the potential impact on the use of apprenticeships, particularly for adult populations undergoing professional retraining.

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

The maintenance of the €6,000 hiring assistance in 2025 serves as an important compensatory factor for employers. This assistance, combined with the general reduction in employer contributions, allows for the net employment cost of apprentices to remain generally attractive despite the increase in gross costs 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% of SMIC threshold applies to all ongoing apprenticeship contracts as of March 1, 2025, not just contracts concluded after this date. It constitutes a modification of the applicable social regime by operation of law, regardless of the contract conclusion date. Payroll managers must therefore update the handling of all apprenticeship payslips beginning with the March 2025 payroll.

How should March 2025 payroll be handled, spanning both the old and new regimes?

For March 2025, two methods are possible: either prorated (application of the old threshold from February 1 to 28, then the new threshold from March 1 onward) or applying the new threshold for the entire month of March. The BOSS and ministerial instructions recommend applying the new threshold for the entire month of March 2025 for simplification purposes. Reference should be made to guidelines from the payroll software provider.

Is the specific exemption from employer contributions for apprentices modified?

No, the reform exclusively concerns the employee contribution exemption threshold. The regime for employer contributions remains unchanged: the general reduction of employer contributions (Fillon reduction) continues to apply under the same conditions as before. Employers continue to benefit from a significant alleviation of payroll costs for apprentices.

What impact does the mandatory health insurance have on apprentices?

The employee contribution for mandatory supplementary health insurance is not affected by the exemption threshold reform. The employee health insurance contribution remains due under the same conditions as before. However, apprentices whose employee share of the health insurance contribution exceeds 10% of their gross remuneration may request an exemption from affiliation. This option remains unchanged and may be particularly relevant for younger apprentices whose remuneration is the lowest.

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

No, the €6,000 hiring assistance for apprentices is completely independent of the employee contribution regime. It is maintained in 2025 for all apprenticeship contracts, without criteria related to company size or diploma level. The payment of assistance continues to be made monthly by the ASP, based on data transmitted in the DSN by the employer.

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