most schemes replace wage increases

The issue of value sharing continues to agitate public debate. This was the case in the summer of 2022 with the purchasing power bill, which had sparked heated debates about the taxation of superprofits. This is still the case with the text adopted at first reading, on June 29, by the National embly, and which aims to transcribe the national interprofessional agreement (ANI) signed in February by employers’ organizations and trade unions – with the exception of the CGT. This agreement provides for the extension of value-sharing mechanisms, such as participation, profit-sharing or a bonus to companies with 11 to 49 employees and imposes its implementation on those which make a profit. “at least equal to 1% of turnover for three consecutive years”. The text also recalls the principle of non-substitution between these devices and salaries, that is to say that they must supplement remuneration and not replace increases.

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A principle to which the economists of the Economic Analysis Council (CAE) – an organization attached to Matignon – return more specifically. In a note published on Tuesday, July 18, the CAE esses the impact and effectiveness of the various value-sharing mechanisms, both on the economy and on public finances.

For the authors of the study, compulsory participation – introduced in 1967 for companies with at least one hundred employees, a threshold lowered to fifty in 1990 – is the only device that does not replace wages. “Compulsory participation is de facto intended to redistribute, according to a fixed and transparent formula, part of the excess profits to employees”, explains the deputy president of the CAE and professor of economics at the London School of Economics and Political Science Camille Landais, co-author of the note. The obligation to participate “leads to a net increase in the share of income received by employees”, with no effect on the wage share. A “excess profits tax” which, however, has no impact on business investment or productivity.

“Important substitution effects”

The criticisms of economists relate above all to voluntary value-sharing schemes, which themselves lead to “to significant substitution effects”. The note shows that the average compensation of employees stabilizes after the adoption of such mechanisms (profit-sharing for companies with fewer than fifty employees, profit-sharing, value-sharing bonus, etc.), whereas it was growing before . Voluntary nature partly explains this result. For the CAE, for example, “a company can decide to put in place” one of these devices at the time of a hiring plan “to negotiate lower wages” new employees. An analysis which confirms that made by INSEE in March about the value sharing bonus (also known as the Macron bonus) which generates a very strong substitution effect. The institute estimates that around 30% of the amount of the bonuses replaced wage increases.

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