French Labour Law

How to Calculate Paid Leave in Payroll for 2025: A Complete Guide

DAIRIA Law · 2026-06-30 · 12 min

How to Calculate Paid Leave in Payroll for 2025: A Complete Guide

Introduction: Paid Leave, an Essential Calculation in Payroll

Calculating paid leave is one of the most recurring and technical operations in payroll management. Between the tenth rule and salary maintenance, the mandatory comparison between the two methods, the specificities of temporary workers and construction companies (BTP), and the major reform of the law of April 22, 2024 regarding the acquisition of leave during illness, payroll managers must master a dense regulatory corpus.

The BOSS (Official Bulletin of the Social Security) provides essential clarifications on the impact of paid leave in the calculation of general exemptions and sector-specific particularities (BTP, temporary work). This complete guide will assist you in mastering all aspects of paid leave calculation in 2025.

Acquisition of Paid Leave

Principle: 2.5 Days per Month of Effective Work

Every employee acquires 2.5 paid leave days per month of effective work with the same employer, leading to 30 paid leave days (5 weeks) for a full year of work. The reference period for acquisition runs from June 1 of year N-1 to May 31 of year N (unless a collective agreement specifies a different period, such as the calendar year).

When the number of days acquired is not a whole number, it is rounded up to the next whole number. For instance, an employee who has worked for 7 months acquires: 7 x 2.5 = 17.5, rounded to 18 paid leave days.

Calculation in Business Days

Many companies calculate leave in working days (Monday to Friday, i.e., 5 days per week) rather than in calendar days (Monday to Saturday, i.e., 6 days per week). In this case, the annual entitlement is 25 working days instead of 30 calendar days.

Switching to working days must never be detrimental to the employee compared to the calculation in calendar days. A verification should be conducted, particularly for employees whose rest days do not correspond to Saturday.

Periods Considered as Effective Work

Certain periods of absence are considered as effective work for the acquisition of paid leave:

  • Paid leave itself
  • Maternity, paternity, and adoption leave
  • Interruptions due to workplace accidents and occupational diseases (within the limit of one year)
  • Training leaves
  • RTT days (reduction of working time)
  • Ordinary sick leave (since the law of April 22, 2024)

The Revolution of the Law of April 22, 2024: Acquisition of Leave During Illness

The law n° 2024-364 of April 22, 2024 fundamentally changed the rules for acquiring paid leave during sick leave by transposing the jurisprudence of the Court of Justice of the European Union (CJEU).

The New Principle

Since this law, employees on non-work-related sick leave acquire paid leave at a rate of 2 paid leave days per month of absence (instead of 2.5 days for effective work), limited to a maximum of 24 paid leave days per year (instead of 30). This acquisition applies retroactively from December 1, 2009.

Practical Impact for Payroll Managers

This reform involves several concrete changes:

  • Payroll software must be configured to generate the acquisition of paid leave during standard sick leave.
  • Employees are entitled to defer unused leave due to illness: the employee has 15 months after their return to take this leave.
  • The employer must inform the employee of their leave rights within the month following their return.
  • Retroactive adjustments (since December 2009) are capped at 2 paid leave days per month of sick leave.

In practice, this reform increases the cost of absenteeism for employers and necessitates rigorous monitoring of leave counters in payroll software.

Calculation of Paid Leave Compensation: Tenth Rule vs. Salary Maintenance

The paid leave compensation is the amount paid to the employee during their leave. It is calculated according to two methods, and the employer must apply the most favorable to the employee.

Salary Maintenance Rule

The employee receives the salary they would have earned had they been working. Specifically, the payslip is prepared as if the employee were in regular activity: same basic salary, same recurring bonuses, same benefits.

This method is straightforward to implement for employees whose remuneration is stable (monthly salary without variation). It is generally more favorable for employees with high fixed salaries.

Tenth Rule (10e)

The compensation equals 1/10th of the total gross remuneration earned during the reference period. All elements of remuneration are included:

  • Base salary
  • Overtime
  • Work-related bonuses (seniority bonus, performance bonus, etc.)
  • Benefits in kind
  • Paid leave compensation from the previous period

Excluded from consideration are annual bonuses (13th month, holiday bonus) paid independently of taking leave, expense reimbursements, and exceptional bonuses not related to work.

The daily compensation for a day of leave is calculated as follows:

Daily Compensation = (Annual Gross Remuneration / 10) / Number of Paid Leave Days Acquired

Numerical Example of Comparison

An employee takes 12 paid leave days (2 weeks). Their monthly salary is €2,800. During the reference period, they earned a total gross remuneration of €35,600 (including bonuses and overtime). They have acquired 30 paid leave days.

Salary Maintenance Method:

  • The employee receives their usual salary of €2,800 for the entire month.
  • Compensation for 12 days = €2,800 x (12/26 working days) = €1,292.31.

Tenth Method:

  • 10th of annual remuneration: €35,600 / 10 = €3,560.
  • Compensation for 12 days: €3,560 x (12/30) = €1,424.

Comparison: €1,424 (10e) > €1,292.31 (maintenance). The employer must apply the tenth rule, which is more favorable to the employee in this case.

This comparison is mandatory for each period of leave taken. Payroll software performs this calculation automatically, but it is recommended to check the settings, especially the remuneration elements included in the base of the tenth rule.

Principle of Paid Leave Funds

In certain sectors, particularly in the BTP (building and public works), the management of paid leave is pooled through paid leave funds. The employer pays contributions to the fund, which then directly pays the paid leave indemnities to employees.

The BOSS specifies the applicable rules regarding contributions paid by the funds:

  • 100% Payment (code 100): the fund pays the full amount of the paid leave indemnity directly to the employee.
  • 90% Payment (code 90): the fund pays 90% of the indemnity, with the remaining 10% retained to cover social charges.

Impact on Social Contributions

The indemnities paid by paid leave funds are subject to social contributions. The employer must declare the amounts paid by the fund in the DSN and include them in the calculation base for contributions. Payroll configuration must be rigorous to avoid double counting.

Temporary Workers: 10% Tenth Rule Increase

The BOSS reminds us that temporary employees benefit from a compensatory paid leave indemnity (ICCP) equal to 10% of the total gross remuneration received during the assignment. This indemnity is paid at the end of each assignment (or monthly in the case of long assignments).

Moreover, for the calculation of general contribution exemptions, the BOSS provides for a reference minimum wage increase of 1.1 (multiplicative coefficient) for temporary employees. This increase accounts for the 10% ICCP included in remuneration.

Example: For a temporary worker in 2025, the reference minimum monthly wage for calculating exemptions is:

€1,801.80 x 1.1 = €1,981.98.

This increase ensures that temporary workers are not penalized in the calculation of the general reduction due to the ICCP.

The Impact of Paid Leave on General Reductions

The BOSS specifies how paid leave is integrated into the formulas for calculating general reductions in employer contributions (formerly Fillon’s reduction).

General Case

Paid leave compensation is an integral part of the gross remuneration considered in the numerator of the calculation formula for the reduction coefficient. The minimum wage in the denominator is calculated based on paid hours, including hours corresponding to paid leave.

When leave is managed by a fund (BTP), the BOSS provides specific formulas that integrate the contribution rates of the leave funds into the calculation. The employer does not directly pay the paid leave indemnity, but the contribution to the fund affects the reduction calculation.

The formula for calculating the T coefficient (maximum reduction rate) incorporates paid leave contributions paid to the fund, which alters the degressive threshold of the reduction.

Accounting for Taken Paid Leave

Accounting in Calendar Days

The accounting in calendar days (from Monday to Saturday, i.e., 6 days per week) is the legal calculation method. The first day of leave accounted for is the first calendar day the employee would have worked. The last day accounted for is the last calendar day before the return, including Saturday.

Example: An employee working Monday to Friday takes a week of leave from Monday to Friday. In calendar days, the total is 6 days (Monday, Tuesday, Wednesday, Thursday, Friday, Saturday).

Accounting in Working Days

In working days (days usually worked, typically Monday to Friday), the same week of leave corresponds to 5 working days.

Switching from one calculation method to the other must not disadvantage the employee. Verification is conducted based on the total annual rights: 30 calendar days = 25 working days = 5 weeks of leave.

Compensatory Paid Leave Indemnity (ICCP) Upon Departure

Upon termination of the employment contract (for whatever reason: resignation, dismissal, rupture conventionnelle, end of fixed-term contract), the employee receives a compensatory indemnity for accrued and unused leave.

The calculation of the ICCP follows the same rules as the paid leave indemnity: a comparison between the tenth rule and salary maintenance, applying the most favorable method.

Example: An employee leaves the company with a balance of 15 paid leave days not taken. Their gross remuneration during the reference period is €34,000.

  • 10th: €34,000 / 10 = €3,400.
  • ICCP for 15 days: €3,400 x (15/30) = €1,700.

This indemnity is subject to social contributions and withholding tax under general law.

The law of April 22, 2024 also introduced important rules on the interplay between paid leave and illness:

  • An employee who falls ill during their leave can now defer the days of leave not taken due to illness, provided they justify a work stoppage.
  • The right to defer is limited to 15 months after the end of the leave period.
  • The employer must inform the employee of their right to defer within one month following their return.

These new provisions strengthen employee protection and impose a more detailed management of leave counters by HR services.

Summary Table of Key Rules in 2025

  • Acquisition: 2.5 calendar days/month (effective work) or 2 calendar days/month (non-work-related illness)
  • Annual Rights: 30 calendar days (25 working days) = 5 weeks
  • Paid Leave Compensation: max(salary maintenance, 1/10th of annual gross remuneration)
  • Temporary Workers: ICCP of 10% + increase in SMIC x 1.1 for reductions
  • Paid Leave Funds (BTP): 100% or 90% payment according to fund code
  • Illness: acquisition of 2 calendar days/month since the law of April 22, 2024
  • Deferral: 15 months after returning for leave acquired during illness

FAQ: Your Questions About Paid Leave in Payroll for 2025

Is the employer always obligated to compare the tenth rule and salary maintenance?

Yes, the comparison between the two methods is a legal obligation for every leave taken. The employer must calculate the indemnity according to both methods and apply the most favorable to the employee. This comparison can be conducted globally for all leave for the period or for each leave taken. In practice, payroll software performs this comparison automatically, but it is essential to verify that the tenth rule base includes all required remuneration elements.

Does an employee on sick leave acquire as many paid leave days as an active employee?

No, since the law of April 22, 2024, an employee on non-work-related sick leave acquires 2 calendar days per month (instead of 2.5 for effective work), limited to a maximum of 24 calendar days per year. However, an employee on work-related accident or occupational disease continues to acquire 2.5 calendar days per month as if they were active, limited to a maximum of one year of absence.

How does the 1.1 increase for temporary workers function in the calculation of reductions?

The 1.1 increase in the reference minimum wage for temporary workers aims to neutralize the effect of the 10% ICCP in the calculation of general reductions. Without this increase, the ICCP would artificially inflate the gross remuneration of the temporary worker compared to the minimum wage, thus reducing the reduction amount. With this increase, the reference minimum wage rises from €1,801.80 to €1,981.98 in 2025, maintaining a balanced calculation.

What are the consequences of not respecting the right to defer leave after illness?

If the employer does not comply with the 15-month deferral right established by the law of April 22, 2024, they may face a legal ruling for damages. The employee could claim compensation for lost leave, calculated according to the most favorable method (tenth or maintenance). Furthermore, the employer has an obligation to inform the employee of their rights within the month following their return. Failure to inform could be deemed a fault leading to the employer’s liability.

Is the compensatory paid leave indemnity subject to social contributions?

Yes, the ICCP is fully subject to social contributions and withholding tax under general law. It is included in the calculation base for all contributions (social security, unemployment, complementary retirement, CSG/CRDS). It is also considered in the calculation of the net social amount (MNS) and taxable income. It must appear on the final settlement and on the last pay slip of the employee.

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