Country report France - Construction Labour Research

European Institute for Construction Labour Research – Country Report FranceCLRWhat is more he/she can reduce 50% of the wages paid from income tax and use reducedsocial insurance contribution rates. In exchange the remuneration must correspond at least tothe national minimum wage SMIC.It may be added, that purchasers of a large piece of equipment (for instance a heating boiler)can take advantage of tax credits in case they have the equipment installed by a contractor.b) Socio-Legislative MeasuresIn 2003 the RMI (Revenu minimum d’insertion, a minimum income support existing since1988) was complemented by the RMA (Revenu minimum d’activité, minimum income forprofessional activity). The RMA represents a new type of contract of employment, whichallows an employer to engage a person on long-term supplementary welfare benefit (at least 6months) for the duration of at least 6 months for a weekly working time of a maximum of 30hours, whereby the RMA to be paid by the employer supplements the RMI which will also bepaid out. The amount of the minimum wage is calculated on the basis of the SMIC hourlyrate. Although the main emphasis of the measure was the reintegration into the labour market,in this way considerations for facilitating those in receipt of the benefit in obtaining a legaladditional source of income to the RMI may also have played a part.A further socio-legislative measure for combating undeclared labour is offered by thepossibility of releasing the self-employed from National Insurance contributions. Within theframe of the law of 1 st August 2003 for the promotion of economic initiative, exemption inthe first 12 months of business may be granted.c) Measures Regarding Employment Rights of ForeignersNon-EU foreigners staying in France without a work and residence permit are forced toperform undeclared labour to survive (Terray 1999). One of the measures to address thisproblem is to regularise this mostly illegal population. The latest large-scale regularisation ofimmigrants without residence permit took place in 1997. At that time about 90,000 peoplewere legalised. Other than in neighbouring Spain, the current political climate does not allowfor such a measure that would probably have an impact on the amount of undeclared labourperformed by reducing, if it is not the demand for, the supply of illegal workers. 7 Longitudinalstudies have notably shown that illegality is perceived and envisaged by the migrant “as anecessary step on the road to legality, in the hopes of future occupational and/or geographicalmobility” (OECD 2000: 63). In the case of EU foreigners from new Member States, Francehas agreed, as the majority of the old EU Member States, to a temporal limitation for the freemovement of workers. While this measure was intended to protect national labour markets,evidence suggests that its results have been mixed if it comes to undeclared labour, as workersfrom these countries are forced to work illegally or as posted workers or self-employed in theframework of the provision of services (Kahmann 2006). With regard to this group,government has decided in March 2006 to ease the free movement of workers in 61 trades insix industries, including certain trades in construction. The European Commission hadrecommended this measure as a way to combat undeclared labour.d) Measures Regarding the Simplification of the Administrative EnvironmentIt may finally be mentioned briefly that the legislative has been attempting for some years todismantle administrative routines and requirements for the purpose of facilitating thefounding of enterprises. Among the procedural simplifications there is also the fact that theURSSAF offers a service, which permits on-line calculation of social security contributionsdue. The tax authorities have equally provided on-line tools for declaration.7 According to official estimates by the French Government at present between 200,000 and 400,000 people areliving in France without the right to stay. Currently, regularisation takes place on a case-to-case basis.26