⚠️ Archive — March 2025 reform. This article describes the law as it stood then. Since 1 January 2026 the SMIC is €12.02/hour (€12.31 from 1 June) and the RGDU (art. L.241-13 of the French Social Security Code) has replaced the réduction Fillon and the sickness and family rate reductions.

French Apprenticeship Reform: New 50% SMIC Social Contribution Exemption Threshold Since March 2025

Introduction: A Major Reform of the Social Regime for Apprenticeships

The social regime applicable to apprenticeships underwent a significant transformation with the entry into force, on 1 March 2025, of a new employee social contribution exemption threshold, lowered to 50% of the SMIC (the French statutory minimum wage). This measure, provided for by the Social Security Financing Act for 2025 (loi de financement de la Sécurité sociale pour 2025, or “LFSS 2025”) and specified by an implementing decree, substantially alters the calculation of the cost of apprenticeships for companies and directly affects apprentices’ payslips.

For payroll managers, HR directors and chartered accountants, this reform requires an immediate update of payroll settings and a precise understanding of the new applicable rules. This article analyses in detail the changes introduced, their practical consequences on the payslip, and the key points employers must monitor to secure the processing of apprentices’ remuneration.

1. Recap of the Previous Regime: Exemption Up to 79% of the SMIC

1.1 The Historic Principle of Employee Contribution Exemption

Before 1 March 2025, apprentices benefited from a full exemption from employee social contributions, including the CSG (contribution sociale généralisée, a general social contribution) and the CRDS (contribution au remboursement de la dette sociale, a contribution towards repayment of the social debt), on the portion of their remuneration not exceeding 79% of the gross monthly SMIC. This threshold, set by Article L. 6243-2 of the French Labour Code in its former wording, was intended to guarantee apprentices net remuneration as close as possible to their gross remuneration.

In practical terms, for a gross monthly SMIC of €1,801.80 as at 1 January 2025 (based on a 35-hour week), the exemption threshold stood at €1,801.80 × 79% = €1,423.42. As nearly all apprentices received remuneration below this threshold, the exemption covered their entire remuneration in the vast majority of cases.

1.2 A Particularly Favourable Regime

This exemption regime set at 79% of the SMIC had the advantage of simplicity: for most apprentices, gross equalled net (excluding any compulsory supplementary health insurance where applicable). Only the oldest apprentices (aged 26 and over, remunerated at 100% of the SMIC or of the applicable collectively agreed minimum wage) or those in their third year of apprenticeship might see their remuneration exceed the threshold and be subject to employee contributions on the portion above it.

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

2.1 Entry Into Force on 1 March 2025

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

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

2.2 Scope of the Reduction

Lowering the threshold has the direct consequence of considerably broadening the base subject to CSG and CRDS for apprentices. Indeed, above 50% of the SMIC, an apprentice’s remuneration is now subject to the following levies:

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

The total levies therefore amount to 9.70% on the portion of remuneration exceeding 50% of the SMIC. The CSG/CRDS base is calculated on 98.25% of remuneration (applying the 1.75% allowance for professional expenses), up to a limit of four times the annual Social Security ceiling.

2.3 Employee Contributions Other Than CSG/CRDS

It is important to specify that the exemption from employee social contributions (health insurance, old-age insurance, unemployment insurance) remains applicable up to the 50% of SMIC limit. Above this threshold, standard employee contributions theoretically become payable. However, in practice, it is primarily the CSG and CRDS that constitute the most significant impact for apprentices, with the other employee contributions remaining limited in most remuneration configurations.

3. Impact on the Apprentice Remuneration Scale

3.1 Recap of the Statutory Remuneration Scale

The minimum remuneration of apprentices is set as a percentage of the SMIC (or of the collectively agreed minimum wage where more favourable) according to the apprentice’s age and the year of performance of the contract. The scale applicable in 2025 is as follows:

Apprentices aged 16–17:

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

Apprentices aged 18–20:

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

Apprentices aged 21–25:

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

Apprentices aged 26 and over:

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

3.2 Identifying the Apprentices Affected

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

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

By contrast, 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 exempt because their remuneration is below 50% of the SMIC.

4. Concrete Impact on the Payslip

4.1 Worked Example: Apprentice Aged 21 in Their 2nd Year

Take the example of an apprentice aged 21 in their 2nd year, remunerated at 61% of the SMIC, i.e. €1,099.10 gross per month.

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

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

Since 1 March 2025 (threshold at 50% of the 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 the 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 pay: €1,080.21

The net reduction for the apprentice therefore amounts to €18.89 per month, or approximately €227 per year.

4.2 Worked Example: Apprentice Aged 26 and Over

For an apprentice aged 26 and over, remunerated at 100% of the SMIC, i.e. €1,801.80 gross per month, the impact is much more significant:

• 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 reduction: €85.86, or approximately €1,030 per year

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

5. Employer Contributions: The Applicable General Reduction

5.1 Standard Calculation

On the employer side, employer social contributions on apprentices’ remuneration are subject to the standard regime. The general reduction in employer contributions (known as the “réduction Fillon”) applies according to the same rules as for other employees. The reduction coefficient is calculated based on the ratio between 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 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 (and not a reconstituted remuneration), which results in 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), enabling a substantial reduction in employer contributions. For companies with 50 or more employees, the maximum coefficient is 0.3234 (including the FNAL contribution at the higher rate).

6. Hiring Aid for Apprentices in 2025

6.1 Maintenance of the €6,000 Aid

The hiring aid for apprentices, set at €6,000 for the first year of performance of the contract, is maintained in 2025. This aid is paid monthly (€500 per month over 12 months) and applies to all apprenticeship contracts concluded between 1 January and 31 December 2025, with no condition as to company size or the level of qualification being prepared.

6.2 Eligibility Conditions

To qualify for the aid, the employer must:

• Conclude an apprenticeship contract between 1 January and 31 December 2025;
• File the contract with the skills operator (opérateur de compétences, or OPCO) within the regulatory deadlines;
• Submit the monthly DSN (déclaration sociale nominative, the standardised monthly social declaration) enabling automatic payment of the aid by the ASP (Agence de services et de paiement, the services and payment agency).

The aid can be combined with the social contribution exemptions applicable to apprentices. It covers a significant part of the apprentice’s salary cost in the first year, making apprenticeship financially very attractive despite the reform of the exemption threshold.

7. Special Case of the Public Sector

7.1 Maintenance of the Specific Exemption

Employers in the non-industrial and non-commercial public sector benefit from a specific exemption regime for apprentices, distinct from the standard regime. This regime, provided for by Article L. 6227-8-1 of the French Labour Code, provides for a full exemption from employer contributions (excluding the additional public-service pension contributions) and is maintained without amendment by the LFSS 2025.

7.2 Interaction With the New Threshold

The lowering of the employee exemption threshold to 50% of the SMIC also applies to public-sector apprentices. However, the specific employer exemption regime is unchanged, which preserves an advantage for public-sector employers compared with the standard regime.

8. DSN Impacts

8.1 Declaration of Employee Contributions

Implementing the new threshold requires an adaptation of DSN settings. Payroll software publishers have had to update the calculation rules to distinguish the exempt portion (up to 50% of the SMIC) from the portion subject to contributions (above 50% of the SMIC). The personnel type codes (codes types de personnel, or CTP) specific to apprentices must be correctly entered to avoid any declaration anomaly.

8.2 Points to Monitor

Payroll managers must be particularly vigilant on the following points:

• The proration of the threshold in the event of an incomplete month (hiring or departure mid-month);
• The proration of the threshold in the event of part-time work;
• The management of the transitional period (before and after 1 March 2025 within the same month of March);
• The correct allocation of CTP codes to the contribution blocks in the DSN;
• Verification of the CSG/CRDS rates applied (9.20% + 0.50% on the base after allowance).

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

9.1 A Net Additional Cost for the Apprentice

Lowering the exemption threshold represents a reduction in purchasing power for apprentices whose remuneration exceeds 50% of the SMIC. While the impact is moderate for the youngest and least experienced apprentices, it can be significant for apprentices aged 26 and over, for whom the net reduction reaches more than €1,000 per year.

9.2 A Political Signal to Watch

This measure forms part of a context of seeking revenue to finance the Social Security system. It reflects a desire to rationalise social exemptions by targeting them more closely on the most vulnerable groups. Employer organisations and professional branches have expressed concerns about the potential impact on the use of apprenticeships, particularly for adults undergoing professional retraining.

9.3 The Maintenance of the €6,000 Aid as a Counterweight

Maintaining the €6,000 hiring aid in 2025 constitutes an important offsetting factor for employers. This aid, combined with the general reduction in employer contributions, keeps the net cost of employing apprentices broadly attractive, despite the increase in gross cost linked to the new employee contribution regime.

FAQ – Frequently Asked Questions on the New Apprenticeship Exemption Threshold

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

The new threshold of 50% of the SMIC applies to all ongoing apprenticeship contracts as from 1 March 2025, and not only to contracts concluded after that date. It is a change to the applicable social regime that takes effect automatically, regardless of the date the contract was concluded. Payroll managers must therefore update the processing of all apprentice payslips as of the March 2025 pay run.

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

For the month of March 2025, two methods are possible: either a prorata temporis approach (applying the old threshold from 1 to 28 February, then the new threshold from 1 March), or applying the new threshold to the entire month of March. The BOSS (Bulletin officiel de la Sécurité sociale, the official Social Security bulletin) and ministerial instructions recommend applying the new threshold to the entire month of March 2025 for the sake of simplicity. Employers should refer to the guidance issued by their payroll software provider.

Is the employer contribution exemption specific to apprentices amended?

No. The reform relates exclusively to the exemption threshold for employee contributions. The regime for employer contributions is unchanged: the general reduction in employer contributions (réduction Fillon) remains applicable according to the same rules as before. Employers continue to benefit from a significant reduction in employer charges on apprentices’ remuneration.

What is the impact on the compulsory supplementary health insurance for apprentices?

The employee contribution towards the compulsory supplementary health insurance is not amended by the exemption threshold reform. The employee health insurance contribution remains payable under the same conditions as before. However, apprentices whose employee health insurance contribution exceeds 10% of their gross remuneration may request an exemption from membership. This option remains unchanged and may be particularly relevant for the youngest apprentices, whose remuneration is the lowest.

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

No. The €6,000 apprentice hiring aid is entirely independent of the employee contribution regime. It is maintained in 2025 for all apprenticeship contracts, with no condition as to company size or qualification level. Payment of the aid continues to be made monthly by the ASP, on the basis of the data submitted by the employer in the DSN.