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France — Umbrella companies agreement presented to government for legalisation

20 July 2010

The Association of Temporary Employment Agencies and HR Services Providers (Prisme) has yesterday presented an agreement on the future regulation of Umbrella companies signed by four unions out of five (CFDT, CGT, CFE-CGC and CFTC) to the Ministry for Labour for legal approval. Force Ouvrière, the third largest union, remains opposed to the agreement.

It is expected that the ministry's legalisation process will not be finished until 2011.

The sticking points in the negotiations between Prisme and the unions were the level of the gross minimum salary for workers represented by Umbrella companies, which has been set at 2,900 Euro per month for a management activity carried out on a full-time basis and the involvement of temporary employment agencies.

It was agreed that temporary employment agencies can operate in the Umbrella companies sector but must found a dedicated subsidiary, which does not get involved in temporary employment.

However, according to French daily Les Echos, the agreement has been met with mixed reactions. The Umbrella companies union (Syndicat National des Enterprises de Portage Salarial) has welcomed the agreement whilst the National Federation of Umbrella Companies (Fédération Nationale de Portage Salarial) called it "an elitist and discriminatory agreement, which does not correspond with the matter in hand."

Specialist lawyer, Emmanuelle Rivez-Domont at law firm Jones Day, told Les Echos "this minimum salary is high and risks excluding some workers who want to work via Umbrella companies. If these workers earn less than the fixed minimum salary, they cannot be taken on by Umbrella companies."



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