Increase wages or pay bonuses? While the unions generally demand permanent increases, the most cautious companies prefer not to commit themselves in the long term with an increase in the wage bill.
The new proposal made last night by the management of TotalEnergies contemplates thus, in addition to a global increase of 7% for 2023 (5% general increase plus 2% individual increases), bonuses that would be between 3,000 and 6,000 euros in the year. 2022, under the distribution of value.
A proposal validated by the CFE-CGC and CFDT unions (majority in TotalEnergies) but not by the CGT. As a reminder, the union behind the strike is demanding a 10% wage increase.
However, between the 3.5% increase granted by TotalEnergies and the bonus that represents approximately one additional month of salary (that is, 8.3%), 10% is reached or even exceeded by 2022. But that is not what the CGT wants.
Salary is contributions.
For the union, the salary increase, unlike the bonus, plays with the so-called ratchet effect. Once increased, the salary is not adjusted downwards. While the bonus can no longer be paid in subsequent years.
In addition, current systems allow premiums to be paid at a lower cost. The companies that pay these bonuses do so as part of the shared value bonus (formerly the Macron bonus). The amounts paid are therefore exempt from taxes and contributions up to 3,000 euros and even up to 6,000 euros if profit and profit sharing agreements have been entered into in the company.
If in this period of inflation the wage increases were higher than those of previous years (+4.3% on average in companies with more than 50 employees according to the Alixio group), most companies have largely opted for the payment of bonuses.
This is the case of LVMH, Stellantis, Bouygues, Air France, Nexans and even Groupama. Bonds that do not satisfy the unions. Following the announcement by Stellantis at the end of September of a bonus of up to 1,400 euros, many of the group’s factories went on strike.
Is there a long-term risk that bonuses will replace salary increases? The shared value bond, which should become permanent in 2024 (then it will only be exempt from social security contributions) offers companies significant room for maneuver with its very high ceiling.
According to Senator (LR) Frédérique Puissat, rapporteur for the Committee on Social Affairs, there is a risk that the bonus will become “a full-fledged element of salary policy”. An evaluation report on the “Macron bonus” will be submitted before the end of 2024. In particular, it must assess the substitution effects of bonuses for salary increases.
Source: BFM TV
