Renewal of PEPA ‘Macron bonus’

Renewal of PEPA ‘Macron bonus’ – draft bill to be considered by the French Parliament in July 2022

The French government plans to include the exceptional purchasing power bonus PEPA in its bill ‘loi pouvoir d’achat’; a bill on emergency measures for the protection of purchasing power.
This government project is an answer to the recent inflation: At the end of June 2022 inflation in France was 5.8% compared to June 2021.
The French bill includes measures to increase social benefits including retirement pensions and social minima as well as the renewal of the exceptional purchasing power bonus (‘prime exceptionnelle de pouvoir d’achat’ – PEPA).
This bonus, often referred to as ‘prime macron’, was first introduced in 2019. Initially supposed to be exceptional by its name, it is now up for renewal for the fourth time.

Renewal of PEPA ‘Macron bonus’ – conditions

The conditions essentially are supposed to remain the same (to learn more check our blog post: macron bonus 2021-2022) but the amount is supposed to triple.
If the bill is validated, the maximum amount of the PEPA Macron bonus will increase
– from 2000 euros to 6000 euros for companies that have signed a company bonus plan ‘intéressement’ as well as for companies with fewer than 50 employees.
– for others, the maximum amount of aid to be paid will increase from 1,000 to 3,000 euros.
The PEPA ‘Macron bonus’ is an optional employee benefit. There is no legal obligation for the employer to set it up. Previously fully exempt from social contributions and payroll taxes, it may now be subject to a flat rate of 20%.
If set up by the employer, it may vary only based on objective criteria. To be eligible, an employee must receive a monthly salary below three times the French minimum salary SMIC.

When to expect the renewal?

The draft bill will be considered by the National Assembly on July 18 2022.
If renewed, employers will have until 31 March 2023 to set up and pay the renewed PEPA ‘Macron Bonus’.