Prud'hommes: what is the lump sum conciliation allowance?
Verified 14 November 2024 - Directorate for Legal and Administrative Information (Prime Minister)
In the event of a dispute between the employer and the employee concerning the dismissal, the employee may refer the matter to the labor board. A first step in the Prud'homale procedure is to reach an agreement between the two parties. That's what we call the reconciliation. This agreement provides for the payment of a lump-sum conciliation allowance. We're doing an update on the regulations.
During conciliation, the agreement may be proposed either by the employer, or by salaried worker, or by the conciliation board of the labor court itself.
Minutes shall be drawn up in the event of agreement between the parties.
The amount of the allowance shall be determined on the basis of a scale which takes into account the length of service of the employee:
Employee's seniority | Amount of compensation |
|---|---|
Less than 1 year | 2 months salary |
Between 1 year and less than 8 years | 3 months of salary for 1 year, plus an additional 1 month per year of service |
Between 8 years and under 12 years | 10 months salary |
Between 12 and under 15 | 12 months salary |
Between 15 and under 19 | 14 months salary |
Between 19 and under 23 | 16 months salary |
Between 23 and under 26 | 18 months salary |
Between 26 and under 30 | 20 months salary |
30 years or older | 24 months salary |
Agreement between employer and employee terminates the dispute between the parties.
The minutes of the agreement shall be deemed to waive all claims and indemnities which may be awarded in the event of dismissal which is void, unjustified or irregular.
Yes, the conciliation allowance may be cumulated with statutory, contractual or contractual allowances connected with the termination of the contract of employment (severance pay, compensatory leave with pay, compensatory period of notice, non-compete compensation, etc.).
The lump sum conciliation allowance is not taxable where it is paid into the regulatory scale limit.
The amount of the allowance shall be determined on the basis of a scale which takes into account the length of service of the employee:
Employee's seniority | Amount of compensation |
|---|---|
Less than 1 year | 2 months salary |
Between 1 year and less than 8 years | 3 months of salary for 1 year, plus an additional 1 month per year of service |
Between 8 years and under 12 years | 10 months salary |
Between 12 and under 15 | 12 months salary |
Between 15 and under 19 | 14 months salary |
Between 19 and under 23 | 16 months salary |
Between 23 and under 26 | 18 months salary |
Between 26 and under 30 | 20 months salary |
30 years or older | 24 months salary |
Yes, the lump-sum conciliation allowance may be exempted from social contributions, of CSG: titleContent and CRDS: titleContent under certain conditions.
Social contributions
Compensation paid in connection with the conciliation and within the limits of the regulatory scale is exempt from contributions up to 2 times the annual social security ceiling (i.e €92,736 ).
CSG and CRDS
Compensation paid in connection with the conciliation and within the limits of the regulatory scale is exempt CSG and CRDS in the limit the total amount excluded from the contribution base. This amount takes into account the severance pay and the compensation awarded by the judge.
The excess fraction is subject to CSG and CRDS.
Conciliation Agreement
Conciliation lump sum scale