French Labour Law

How to Manage Sick Leave and Payroll Subrogation in 2025: A Comprehensive Guide

DAIRIA Law · 2026-06-09 · 10 min

How to Manage Sick Leave and Payroll Subrogation in 2025: A Comprehensive Guide

Introduction: Sick Leave and Subrogation, Complex Yet Essential Mechanisms

Managing sick leave in payroll is one of the most complex operations for payroll managers. It involves mastering the calculation of daily social security allowances (IJSS), the mechanism of subrogation, employer salary maintenance (legal or contractual), and the impacts on social contributions and the social security ceiling.

The BOSS (Official Bulletin of Social Security) provides critical clarifications on these topics, particularly regarding the reduction of the ceiling in the case of subrogation and the maintenance of complementary social protection (PSC) during the suspension of the employment contract. This guide supports you in the complete management of sick leave in payroll for the year 2025.

The Waiting Period and Calculation of IJSS

The 3-Day Waiting Period

In the case of ordinary sick leave, social security applies a 3-day waiting period during which no IJSS is paid. This period begins from the first day of leave prescribed by the doctor. IJSS is paid starting from the 4th day of leave.

Exceptions to the waiting period:

  • Sick leave for long-term illness (ALD): the waiting period only applies to the first leave
  • Work-related accidents and occupational diseases: no waiting period, IJSS is paid from the day after the leave begins
  • Maternity: no waiting period

The employer may be required to compensate for this waiting period based on the provisions of the applicable collective agreement. Many agreements provide for salary maintenance from the first day of leave, thus eliminating the effect of the waiting period for the employee.

Calculation of IJSS for Illness

IJSS for illness is calculated using the following formula:

IJSS = 50% of the daily wage base (SJB)

The daily wage base is calculated based on the last 3 months of gross salary prior to the leave, within the limit of 1.8 times the monthly minimum wage (SMIC).

In 2025, with a gross monthly SMIC of €1,801.80 (based on 35 hours), the ceiling is:

1,801.80 x 1.8 = €3,243.24

The SJB is calculated as follows: salary of the last 3 months (capped) / 91.25 days.

Concrete example:

  • Employee with a gross monthly salary of €2,800 (below the ceiling of €3,243.24)
  • SJB = (2,800 x 3) / 91.25 = €92.05
  • IJSS = 92.05 x 50% = €46.03 per day

For an employee with a salary of €4,000 (above the ceiling):

  • SJB = (3,243.24 x 3) / 91.25 = €106.63
  • IJSS = 106.63 x 50% = €53.31 per day (maximum IJSS)

Subrogation: The Employer Receives IJSS Instead of the Employee

Definition and Principle of Subrogation

Subrogation is the mechanism by which the employer replaces the employee to directly receive the IJSS from social security. In return, the employer advances the employee the salary maintenance corresponding to the period of leave.

The BOSS specifies that subrogation is possible when two conditions are met:

  1. The employer maintains all or part of the remuneration during the leave (legal, contractual, or voluntary obligation)
  2. The salary maintenance is at least equal to the amount of the IJSS for the same period

Subrogation is not mandatory, but it is widely practiced as it simplifies the management for the employee, who receives a regular salary without interruption.

Total Subrogation vs Partial Subrogation

Two situations are distinguished:

  • Total subrogation: the employer maintains the entire remuneration (100% of gross salary) and receives the IJSS as reimbursement. The employee does not incur any salary loss.
  • Partial subrogation: the employer maintains only a part of the remuneration (for example, 90% or 66.66%) and receives the corresponding IJSS.

This distinction is significant as it impacts the applicable social security ceiling.

Impact on the Social Security Ceiling

The Rule on Ceiling Reduction

The BOSS provides essential clarifications regarding the management of the social security ceiling in the event of subrogation:

  • If the employer fully maintains the remuneration (total subrogation with supplement), the ceiling is not reduced. The employee is treated as if they were in normal activity.
  • If the employer only pays the IJSS by subrogation (without employer supplement), the ceiling is reduced pro rata the period of absence. The subrogated IJSS is only subject to the reduced CSG/CRDS rate.

This distinction is fundamental for calculating capped contributions (basic retirement, Agirc-Arrco tranche 1) during the sick leave period.

Example of Ceiling Reduction

Let’s take an employee absent for the entire month of March 2025 (31 calendar days) with a usual gross salary of €3,500.

Case 1: Full maintenance of salary

  • The employer pays €3,500 gross
  • Receives IJSS by subrogation (approximately €1,380)
  • The SS ceiling remains at €3,925 (no reduction)
  • Contributions are calculated normally on €3,500

Case 2: Subrogation of IJSS only (without supplementary maintenance)

  • The employer pays only the subrogated IJSS (approximately €1,380)
  • The ceiling is reduced: €0 (total absence for the month, no active remuneration)
  • The IJSS is subject only to CSG/CRDS at the reduced rate (6.20% CSG + 0.50% CRDS)

Under Article L.1226-1 of the Labour Code, the employer is required to supplement the IJSS for employees with at least 1 year of seniority at the company. The maintenance operates as follows:

  • From the 1st to the 30th day: 90% of the gross remuneration that the employee would have received if they had worked
  • From the 31st to the 60th day: 66.66% (two-thirds) of the same remuneration

These durations are increased by 10 days for each 5 years of seniority, within the limit of 90 days at 90% and 90 days at 66.66%.

Salary maintenance is understood after deducting the IJSS: the employer only pays the difference between the IJSS and the guaranteed maintenance level.

Conventional Maintenance

Many collective agreements provide for more favorable provisions than the law:

  • Maintenance at 100% from the 1st day of leave (without waiting period)
  • Longer maintenance periods
  • Reduced seniority conditions (6 months or even no condition)

It is imperative to check the applicable collective agreement to determine the exact level of maintenance. In the case of more favorable provisions in the agreement, these will take precedence over the legal provisions.

Numerical Example of Salary Maintenance

An employee with 3 years of seniority, with a gross salary of €2,800, on sick leave from February 1 to 28, 2025:

  • Calendar days of leave: 28 days
  • SS waiting period: 3 days (IJSS from the 4th day)
  • Daily IJSS: €46.03
  • Number of days compensated by SS: 25 days
  • Total gross IJSS: 46.03 x 25 = €1,150.75
  • Maintenance at 90%: 2,800 x 90% = €2,520
  • Employer supplement: 2,520 – 1,150.75 = €1,369.25

On the payslip, there will be: subrogated IJSS (€1,150.75), employer supplement (€1,369.25), for a reconstructed gross of €2,520.

Social Contributions During Sick Leave

Treatment of Subrogated IJSS

Subrogated IJSS are not subject to standard social contributions. They are subject only to:

  • CSG at the reduced rate of 6.20% (instead of 9.20% for activity income)
  • CRDS of 0.50%

The CSG/CRDS base on IJSS is 100% of the amount of the IJSS (no 1.75% allowance).

Treatment of Employer Supplement

The employer’s salary supplement is subject to all social contributions under standard conditions (employee and employer contributions). It is included in the contribution base like an activity salary.

Complementary Social Protection (PSC) During Sick Leave

The BOSS specifies that complementary social protection (mutual insurance and provident fund) must be maintained for the entire duration of the suspension of the employment contract due to illness, as long as the employee benefits from salary maintenance (total or partial) or IJSS.

Contributions for mutual insurance and provident fund continue to be deducted from the payslip. The base for these contributions is generally calculated based on the reconstructed remuneration (what the employee would have received if they had worked).

This maintenance is a condition for the mandatory and collective nature of the system, necessary for the benefit of the social exemption of employer contributions. The interruption of the system during sick leave would compromise the exemptions for all personnel.

Practical Management in Payroll Software

Step 1: Entering the Absence

The first step is to enter the sick leave in the payroll software with the exact start and end dates of the leave. The software automatically calculates:

  • The deduction for absence (based on working days, workdays, or calendar days according to configuration)
  • The waiting period
  • The compensated days

Step 2: Estimating and Entering IJSS

In the absence of a response from the CPAM (a common delay of 2 to 4 weeks), the employer must estimate the IJSS to prepare the payslip. Payroll software includes an estimation calculation engine. A regularization will be made upon receipt of the CPAM’s final statement.

Step 3: Calculating Salary Maintenance

The software applies the maintenance rules (legal or contractual) and calculates the employer supplement by deducting the IJSS (estimated or actual) from the guaranteed amount.

Step 4: Regularization

Upon receipt of the final statement from CPAM, the payroll manager regularizes any discrepancies between the estimate and the actual amount of IJSS. This regularization may occur on a subsequent payslip.

Long-Term Absences: Points of Attention

For long-term absences (beyond 6 months), several points warrant attention:

  • End of employer maintenance: beyond the duration of conventional maintenance, only IJSS and possibly benefits from the provident scheme are paid
  • Portability of mutual insurance: in the event of contract termination, the employee benefits from portability for 12 months
  • Return-to-work visit: mandatory after an absence of more than 60 days (non-professional illness) or 30 days (work-related accident)
  • Employer’s medical visit: the employer can have the leave verified by an authorized physician

FAQ: Your Questions on Sick Leave and Payroll Subrogation

Is subrogation mandatory for the employer?

No, subrogation is not mandatory in itself. However, it becomes automatic when the employer maintains the salary at least equal to the IJSS during the leave period. In practice, as soon as the employer practices salary maintenance (legal or contractual), they benefit from implementing subrogation to directly recover the IJSS from CPAM rather than having them pass through the employee. The request for subrogation is made via the DSN.

How to calculate the employer’s supplement when the employee is on therapeutic part-time?

In the case of therapeutic part-time, the employee receives both a salary for the time worked and IJSS for the time not worked. The calculation of the employer supplement is based on the actual loss of remuneration. The employer compares the reconstructed remuneration (what the employee would have received at full time) with the sum of the part-time salary and IJSS, and supplements the difference according to the guaranteed maintenance level.

Is the social security ceiling always reduced during sick leave?

No, the ceiling is not reduced if the employer fully maintains the remuneration. The reduction of the ceiling only occurs when the employer pays only the subrogated IJSS without a supplement, or when the supplement does not allow for the total usual remuneration to be reconstructed. The BOSS clarifies that the full maintenance of remuneration neutralizes the reduction of the ceiling.

Do subrogated IJSS count towards the net social amount (MNS)?

Yes, IJSS paid by subrogation are included in the calculation of MNS. They are part of the total gross remuneration as defined in the decree of January 31, 2023. In contrast, IJSS paid directly to the employee by CPAM (without subrogation) are excluded from the MNS appearing on the payslip, as they do not pass through the employer.

Must the mutual insurance be maintained throughout the sick leave?

Yes, complementary social protection (mutual insurance and provident fund) must be maintained for the entire duration of the suspension of the employment contract for illness, in accordance with the provisions of the BOSS. This maintenance concerns both the employer’s and the employee’s parts of contributions. The interruption of the system during the leave could compromise the collective and mandatory nature of the scheme, leading to an URSSAF adjustment affecting all social exemptions of employer contributions.

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