Profit-sharing is a non-compulsory employee savings scheme set up with the consent of employees. In fact, the agreement reached enables both the company and its employees to benefit from tax and social security reductions. It also ensures motivation and loyalty by associating them financially with the company’s performance.
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How can you implement this system in your company?
Which companies are eligible for profit-sharing?
All companies can set up this agreement, regardless of their legal form, workforce or business sector. Implementation is not required by law.
Under what conditions can a company set up a profit-sharing scheme?
The profit-sharing agreement is set up through a collective agreement between the employer and employees.
The conclusion of is made either by :
- Collective bargaining agreement.
- Agreement with the employer and representative trade unions.
- Social and economic committee agreement.
- Referendum adopted by 2/3 of the workforce on a project presented by the employer.
A unilateral decision by the head of the company is sufficient for companies with fewer than 50 employees. In this case, the profit-sharing system you wish to set up is that of your professional sector.
How do I set up a profit-sharing agreement?
Each company is free to define its profit-sharing agreement in its own way. Nevertheless, you must respect the obligations associated with its conclusion and the clauses that must be present.
However, to facilitate the implementation of the agreement in its structure, the company can choose two resources:
- The profit-sharing agreement presented by the Ministry of the Economy and Finance and the Ministry of Labor. It follows to the letter the mandatory clauses included in this type of agreement.
- The profit-sharing agreement within the company’s professional branch.
In all cases, it’s best tobe accompanied by a lawyer. He’s the only one who can guarantee compliance with legal obligations.
What content is essential in a profit-sharing agreement?
The agreement must therefore provide for :
- The system for informing personnel and verifying execution procedures.
- The preamble setting out the reasons for the agreement. It also sets out the arguments that led to the choice of the profit-sharing calculation method and the distribution of its results.
Profit-sharing is therefore a voluntary scheme resulting from an agreement between the two sides of industry. It enables any company to give its employees a financial stake in the company’s results or performance.