Introduction: Sick Leave and Subrogation, Complex but 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 (either legal or contractual), and the impacts on social contributions and the social security ceiling.

The BOSS (Bulletin Officiel de la Sécurité Sociale) provides crucial details 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 will assist you in the complete management of sick leave in payroll in 2026.

The Waiting Period and Calculation of IJSS

The 3-Day Waiting Period

In cases of ordinary sick leave, social security applies a 3-day waiting period during which no IJSS is paid. This period begins on 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 applies only to the first leave
Work accident and occupational disease: no waiting period, IJSS is paid from the next day of leave
Maternity: no waiting period

The employer may be required to compensate for this waiting period depending on the provisions of the applicable collective agreement. Many agreements specify salary maintenance from the first day of leave, thereby removing the effect of the waiting period for the employee.

Calculation of IJSS for Illness

The IJSS for illness is calculated using the following formula:

IJSS = 50% of the basic daily salary (SJB)

The basic daily salary is calculated based on the 3 last months of gross salary prior to the leave, capped at 1.4 times the monthly SMIC. This ceiling was lowered from 1.8 to 1.4 times the SMIC by decree no. 2025-160 of February 20, 2025, for work stoppages starting from April 1, 2025.

In 2026, with a gross monthly SMIC of €1,867.02 (as of June 1, 2026, based on 35 hours), the ceiling is:

1,867.02 x 1.4 = €2,613.83

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

Concrete Example:

Employee with a gross monthly salary of €2,400 (below the ceiling of €2,613.83)
SJB = (2,400 x 3) / 91.25 = €78.90
IJSS = 78.90 x 50% = €39.45 per day

For an employee with a salary of €4,000 (above the ceiling of €2,613.83), the salary taken into account is capped:

SJB = (2,613.83 x 3) / 91.25 = €85.93
IJSS = 85.93 x 50% = €42.97 per day (maximum IJSS for a stoppage starting from July 1, 2026)

Subrogation: The Employer Receives IJSS Instead of the Employee

Definition and Principle of Subrogation

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

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

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

Subrogation is not mandatory, but it is widely practiced as it simplifies 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 experience any loss of salary.
Partial subrogation: the employer maintains only part of the remuneration (e.g., 90% or 66.66%) and receives the corresponding IJSS.

This distinction is important as it has implications for the applicable social security ceiling.

The Rule on Reducing the Ceiling

The BOSS provides essential clarifications on managing the social security ceiling in case of subrogation:

If the employer fully maintains the remuneration (total subrogation with an addition), 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 addition), the ceiling is reduced proportionally for the period of absence. The subrogated IJSS are only subject to CSG/CRDS at the reduced rate.

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

Example of Ceiling Reduction

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

Case 1: Full Salary Maintenance

The employer pays €3,500 gross
They receive the IJSS by subrogation (approximately €1,380)
The SS ceiling remains at €4,005 (no reduction)
Contributions are calculated normally on €3,500

Case 2: Subrogation of IJSS Only (without additional maintenance)

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

Employer Salary Maintenance: Legal and Contractual Obligations

Legal Maintenance (Monthly Payment Law)

Under Article L.1226-1 of the Labour Code, the employer is required to complete the IJSS for employees justifying at least 1 year of seniority in the company. Maintenance occurs as follows:

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

These durations can be increased by 10 days for each 5 years of seniority, with a maximum of 90 days at 90% and 90 days at 66.66%.

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

Contractual Maintenance

Many collective agreements provide more favorable provisions than the law:

100% maintenance from day 1 of the leave (without waiting period)
Longer maintenance durations
Reduced seniority conditions (6 months, or no condition at all)

It is imperative to verify the applicable collective agreement to determine the exact level of maintenance. In cases where more favorable provisions exist in the agreement, these will prevail over the legal framework.

Numerical Example of Salary Maintenance

An employee with 3 years of seniority, a gross salary of €2,800, in sick leave from February 1 to February 28, 2026:

Calendar days of absence: 28 days
SS waiting period: 3 days (IJSS from the 4th day)
Salary €2,800 > ceiling 1.4 SMIC (€2,613.83): the IJSS is capped
Daily IJSS: €42.97 (maximum amount)
Number of days compensated by SS: 25 days
Total gross IJSS: 42.97 x 25 = €1,074.25
Maintenance at 90%: 2,800 x 90% = €2,520
Employer’s addition: 2,520 – 1,074.25 = €1,445.75

On the payslip, the following will appear: subrogated IJSS (€1,074.25), employer’s addition (€1,445.75), for a reconstructed gross of €2,520.

Treatment of Subrogated IJSS

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

CSG at a 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 IJSS (no 1.75% deduction).

Treatment of the Employer’s Addition

The salary addition paid by the employer is subject to all social contributions under common law conditions (employee and employer contributions). It is included in the contribution base just like activity salary.

The BOSS specifies that complementary social protection (mutual and provident funds) must be maintained throughout the duration of the employment contract suspension due to illness, as long as the employee receives salary maintenance (total or partial) or IJSS.

Contributions for mutual funds and provident insurance continue to be deducted from the payslip. The base for these contributions is usually calculated based on the reconstructed remuneration (what the employee would have received had they 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. Interrupting the scheme during sick leave would jeopardize exemptions for the entire staff.

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 precise start and end dates of the leave. The software automatically calculates:

The deduction for absence (based on working days, workable days, or calendar days depending on settings)
The waiting period
The days compensated

Step 2: Estimating and Entering IJSS

If there is no response from the CPAM (often a delay of 2 to 4 weeks), the employer must estimate the IJSS to produce the payroll. Payroll software integrates an estimation calculation engine. A regularization will be performed upon receipt of the final statement from the CPAM.

Step 3: Calculating Salary Maintenance

The software applies maintenance rules (legal or contractual) and calculates the employer’s addition by deducting the IJSS (estimated or real) from the guaranteed amount.

Step 4: Regularization

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

Long-Term Sick Leave: Points of Caution

For long-term sick leaves (beyond 6 months), several points deserve attention:

End of employer maintenance: beyond the duration of contractual maintenance, only IJSS and possibly provident indemnities are paid
Portability of mutual funds: in case of contract termination, the employee benefits from portability for 12 months
Return to work visit: mandatory after an absence of over 60 days (non-professional illness) or 30 days (work accident)
Employer’s check-up visit: the employer may have the leave checked by a designated doctor

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 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 have an interest in implementing subrogation to directly recover the IJSS from CPAM rather than having it pass through the employee. The subrogation request is made via the DSN.

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

In the case of therapeutic part-time, the employee receives both a salary for the hours worked and IJSS for the hours not worked. The calculation of the employer’s addition 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 part-time salary and IJSS, and completes the difference according to the level of guaranteed maintenance.

No, the ceiling is not reduced if the employer fully maintains remuneration. The ceiling reduction only applies when the employer pays only the subrogated IJSS without an addition, or when the addition does not allow for the reconstruction of the total usual remuneration. The BOSS specifies that full maintenance of the remuneration neutralizes the ceiling reduction.

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

Must complementary mutual protection be maintained throughout the entire sick leave?

Yes, complementary social protection (mutual and provident funds) must be maintained during the entire suspension of the employment contract due to illness, according to BOSS provisions. This maintenance concerns both the employer’s and employee’s share of contributions. Interrupting the scheme during the absence could jeopardize the collective and mandatory nature of the system, leading to an URSSAF revision concerning the social exemptions of employer contributions.

How to Manage Sick Leave and Payroll Subrogation in 2026: A Complete Guide