1300 Net Euros TOUTE SA VIE A BIG NAME OF Salaries That Are Due to Be Paid to SMIC,

While the SMIC is consistently rising, more than 70% of the major professional fields now have pay scales that are below the federal minimum wage. As a result, it can take a salary many years to leave SMIC.

Three increases in less than a year. Since last fall, the Smic has been growing each quarter. 2,2% on October 1, 2021; 0,9% in January; and 2,65% in May of the previous year. The story is not over yet. A fourth revalorization should take place this fall because of inflation that is expected to remain above 2 percent in the coming months, according to Insee.

For those receiving the minimum wage, who, according to the Dares, made up 13% of all private sector employees in 2021, this is good news in light of the current raging inflation.

The issue is that as the Smic rises, an increasing number of professional branches find themselves outside of the gates. Their pay scales are found to be partially below this minimal wage. 120 of the 171 professional fields with more than 5000 employees have minimum wages that are customarily lower than the SMIC. not a record. Only 37 of them existed as of December 31, 2020, whereas 108 did so as of last October. Their number has tripled since the 2021 inflationary surge.

This does not imply that the salaries in these branches are paid below SMIC, which is illegal. However, many employees run the risk of being forced to accept this minimum wage.

The Smic "piège"

How can this "piège at Smic" be explained? Employers have the right to implement the subsequent evolution of pay in accordance with traditional pay scales if they are required to pay employees a minimum of 1300 euros net per month (the SMIC as of May 1, 2022). Or, if several levels of these grilles fall below the Smic, salaries may remain static for a number of years, even after the traditional echelon has ratcheted up and surpassed the minimum wage level.

For instance, according to the CFDT, there were at the beginning of the year "douze coefficients below the smic" in the industrial sector of flying. To put it another way, if it is possible to expect to pass through an échelon every 12 months, it should theoretically take 12 years to capture the Smic.

The most effective channels for purchasing power

More pressing still, the rise in branch minimum wages would have a more positive impact on purchasing power than the rise in the SMIC. An Insee study from 2018 found that, in businesses with more than 10 employees, an increase in the branch minimum leads to more frequent salary revisions than an increase in the Smic.

This explains the government's initiative to force the branches to quickly renegotiate their pay scales.

The issue is that some people exercise their feet. First of all because many businesses prefer to contain their cost increases caused by inflation by taking advantage of exonerations. Employers receive a reduction in patronage taxes and cotizations on annual salaries less than 1,6 Smic, subject to specific criteria. The renegotiation of the grilles may result in a significant number of employees losing this tax benefit.

After the carotte, the batter

How can they be persuaded to return to their employment grilles, though? first by encouraging them to renegotiate. Elisabeth Borne, the previous administration's minister of labor at the time, as well as Gérard Larcher, Chirac's minister of labor relations in 2005, both noted that the number of Smicards had reached a record high in France, with 16.3% of them receiving the minimum wage.

If these invitations are successful, they will no longer be sufficient when the Smic increases every three months. Then, more severe measures are implemented. This is what was predicted for Terra Nova.

First, by playing with the levels of cotization exoneration. The sector's businesses no longer receive tax benefits if your industry doesn't change its grilles.

The research tank envisions a more complicated system that would immediately exonerate all businesses in the sector, with the exception of dishonest companies that regularly update their compensation schedules within business agreements.

But a third option would have the support of the government. The Labor Department uses the threat of an administrative merger to pressure branch partners to engage in regular negotiations. If a sector doesn't update its grilles, it might merge with another that is quicker to adjust to Smic price increases. The lack of wage negotiations will be a criterion for merging two branches in the proposed law on the purchase power, which is scheduled to be unveiled on July 6. Will the government's blunder be effective?