French Labour Law

How to Calculate Paid Leave in Payroll in 2025: A Comprehensive Guide

DAIRIA Law · 2026-06-09 · 12 min

How to Calculate Paid Leave in Payroll in 2025: A Comprehensive Guide

Introduction: Paid Leave, an Essential Calculation in Payroll

Calculating paid leave is one of the most recurrent and technical operations in payroll management. Between the tenth rule and salary maintenance, the mandatory comparison between the two methods, the specifics of temporary workers and construction companies, 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 framework.

The BOSS (Bulletin Officiel de la Sécurité Sociale) provides essential clarifications on the impact of paid leave on the calculation of general exemptions and sector-specific issues (construction, temporary work). This comprehensive guide assists you in mastering all aspects of calculating paid leave in 2025.

The Acquisition of Paid Leave

The Principle: 2.5 Days of Paid Leave per Month of Actual Work

Every employee acquires 2.5 days of paid leave per month of actual work with the same employer, amounting to 30 days of paid leave (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 stipulates another period, such as the calendar year).

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

Counting in Working Days

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

The conversion to working days should never disadvantage the employee compared to the counting in calendar days. A verification must be carried out, particularly for employees whose rest days do not correspond to Saturday.

Periods Considered as Actual Work

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

  • Paid leave itself
  • Maternity, paternity, and adoption leave
  • Absences due to occupational accidents and work-related diseases (within one year)
  • Training leave
  • RTT days (reduced 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 has profoundly changed the rules for acquiring paid leave during sick leave, 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 days of paid leave per month of absence (instead of 2.5 days for actual work), capped at 24 days of paid leave 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 ordinary sick leave.
  • A carry-over right is provided for leave not taken 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 one month of their return.
  • Retroactive adjustments (since December 2009) are capped at 2 days of paid leave per month of sick leave.

In practice, this reform increases the cost of absenteeism for employers and requires meticulous tracking of leave balances in payroll systems.

The Calculation of Paid Leave Indemnity: Tenth Rule vs Salary Maintenance

The indemnity for paid leave 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.

The Salary Maintenance Rule

The employee receives the remuneration they would have received if they had worked. In practice, the payslip is established as if the employee were in normal activity: same base salary, same recurring bonuses, same benefits.

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

The Tenth Rule

The indemnity is equal to 1/10th of the total gross remuneration received during the reference period. All elements of remuneration are taken into account:

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

Excluded are annual bonuses (13th month, holiday bonus) paid regardless of leave taken, reimbursements of expenses, and exceptional bonuses not related to work.

The indemnity for one day of leave is calculated as follows:

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

Numeric Example of Comparison

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

Salary Maintenance Method:

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

Tenth Method:

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

Comparison: €1,424 (tenth) > €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 leave taken. Payroll software performs this calculation automatically, but it is recommended to verify the settings, especially the remuneration elements included in the basis for the tenth rule.

The Principle of Paid Leave Funds

In certain sectors, particularly construction, 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 rules governing payments by the funds:

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

Impact on Social Contributions

The indemnities paid by the paid leave funds are subject to social contributions. The employer must declare the amounts paid by the fund in the DSN (Déclaration Sociale Nominative) and include them in the basis for contributions. Payroll configuration must be rigorous to avoid double counting.

Temporary Workers: The Increase of 1/10th (10%)

The BOSS reminds us that temporary employees benefit from a compensatory indemnity for paid leave (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 a long assignment).

Additionally, for the calculation of general exemptions from contributions, the BOSS provides for an increase of the reference minimum wage by 1.1 (multiplicative coefficient) for temporary employees. This increase accounts for the 10% ICCP included in their remuneration.

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

€1,801.80 x 1.1 = €1,981.98.

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

The Impact of Paid Leave on General Exemptions

The BOSS clarifies the methods of integrating paid leave into the formulas for calculating the general exemptions from employer contributions (formerly Fillon reduction).

The General Case

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

The Funds in Connection with Exemptions

When leave is managed by a fund (construction), the BOSS provides specific formulas integrating the fund contribution rates into the calculation. The employer does not directly pay the paid leave indemnity, but the fund contributions affect the calculation of the exemption.

The formula for calculating the T coefficient (maximum reduction rate) includes the contributions for paid leave paid to the fund, which modifies the threshold of the exemption’s degressivity.

The Counting of Paid Leave Taken

Counting in Calendar Days

The counting in calendar days (Monday to Saturday, or 6 days per week) is the legal counting method. The first day of leave counted is the first calendar day the employee was supposed to work. The last counted day is the last calendar day before the return, including Saturday.

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

Counting in Working Days

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

The transition from one counting method to another must not disadvantage the employee. The verification is made on the total annual entitlements: 30 calendar days = 25 working days = 5 weeks of leave.

The Compensatory Indemnity for Paid Leave (ICCP) Upon Departure

When a work contract is terminated (for any reason: resignation, layoff, rupture conventionnelle, end of CDD), the employee receives a compensatory indemnity for accrued and unused leave.

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

Example: An employee leaves the company with an unused balance of 15 calendar days of leave. Their gross remuneration over the reference period is €34,000.

  • Tenth: €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 at source under standard law conditions.

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

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

These new provisions strengthen employee protection and impose a more detailed management of leave balances on HR departments.

Summary Table of Key Rules in 2025

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

FAQ: Your Questions on Paid Leave in Payroll in 2025

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

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

Does an employee on sick leave acquire as much leave as an employee at work?

No, since the law of April 22, 2024, an employee on non-professional sick leave acquires 2 calendar days per month (instead of 2.5 for actual work), capped at 24 calendar days per year. However, an employee on leave due to an occupational accident or work-related illness continues to acquire 2.5 calendar days per month, as if they were working, capped at one year of absence.

How does the 1.1 increase for temporary workers work in calculating exemptions?

The increase of 1.1 of the reference minimum wage for temporary workers aims to neutralize the effect of the 10% ICCP in calculating general exemptions. Without this increase, the ICCP would artificially raise the temporary worker’s gross remuneration compared to the minimum wage, thereby reducing the amount of the exemption. With the increase, the reference minimum wage rises from €1,801.80 to €1,981.98 in 2025, maintaining the balance in the calculation.

What are the consequences of not respecting the carry-over right for leave after illness?

If the employer does not respect the 15-month carry-over right established by the law of April 22, 2024, they may face a risk of court condemnation for damages. The employee may claim compensation corresponding to the lost leave, calculated according to the most favorable method (tenth or maintenance). Additionally, the employer has an obligation to inform the employee of their rights within one month of their return. Failure to inform may be considered a fault engaging the employer’s liability.

Is the compensatory indemnity for paid leave subject to social contributions?

Yes, the ICCP is fully subject to social contributions and withholding at source under common law conditions. It is included in the basis for all contributions (social security, unemployment, supplementary retirement, CSG/CRDS). It also factors into the calculation of the net taxable amount and should be included in the final account settlement and on the last payslip of the employee.

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