French government announces measures to boost employee income

Following a conference with labor unions and employer organizations on November 9th, Sébastien Lecornu announced a series of potential changes impacting overtime pay, value-sharing bonuses, and fuel assistance. These adjustments could take effect as early as 2027.

The tax exemption threshold for overtime pay is set to increase from €7,500 to €10,000 annually. This change would allow a larger portion of overtime earnings to be exempt from income tax.

The value-sharing bonus (PPV) program is also expected to expand, potentially including an additional 1.5 million employees, bringing the total potential beneficiaries to nearly 4 million. Currently, the program is available to companies with fewer than 50 employees.

The government confirmed that the fuel bonus cap will remain at €1,000 in 2027. This cap was previously raised during the crisis related to the Strait of Hormuz and is intended to provide companies with more flexibility in assisting employees with commuting costs. “We want to limit uncertainties about inflation and purchasing power,” stated Roland Lescure.

Furthermore, employers will continue to be able to cover 75% of employee costs for public transportation, a higher rate than the legal minimum of 50%. This measure will also be extended within the 2027 budget.

Sébastien Lecornu stated the government intends to utilize all available tools to support French incomes, fulfilling a promise made by the Prime Minister.