The purchasing power act 2008-111 was published in the Journal Officiel on the 8th February 2008.

The Civil Service has clarified many issues in the interdepartmental decree of the 12^th of February 2008.

We have chosen to set out hereby the main measures of this purchasing power act, namely exceptional repurchase of days off, exceptional unfreezing of profit-sharing and exceptional payment of a 1,000 € bonus in small companies.

We are at your entire disposal whether you need more information regarding the conditions of application for these measures. Moreover we would help you implement them in your company.

We are still waiting for further information about the "practical" modes of enforcement of these measures from the Civil Service.

I - Exceptional repurchase of day off with regard to compensation day

From now on many employees from private sector can give up partly or entirely the compensation days they have acquired until the 31st of December 2009.

Thus the employee may ask his employer who might agree or not for the conversion of a part of or all his compensation days into money.

The employer must increase the value of compensation days according to legal provisions in regard to overtime hours.

Repurchase of compensation days acquired as of 31st December 2007: the payment of these days is exempted from any social contributions except CSG or CRDS.

This exemption is granted on two conditions: the request must be made by the 31st of July 2008 and the payment by the 30th of September 2008.

Repurchase of compensation days acquired between 1st January 2008 and 31st December 2009: the payment will be exempted from income tax and related contributions will be reduced in the same way as for overtime.

II - Exceptional unfreezing of profit-sharing

According to the article 5 of the purchasing power act employees enjoying profit-sharing can unfreeze their profit-sharing rights exceptionally and without justifying how money would be used.

The payment of profit-sharing will be exempted from social contributions and income tax in the same way as at the end of unavailability deadline or due to private events.

Regarding the profit-sharing made by the 31st of December 2007 employees must claim the anticipated payment before the 30th of June 2008.

The ceiling upper limit of this unfreezing has been fixed at 10,000 € free of any social deduction. In certain cases it can be subject to an agreement.

Employers have to inform their employees of the possibility of unfreezing the profit-sharing within 2 months after publication of the act.

III - Exceptional bonus in small companies

According to the article 7 of the purchasing power act companies and establishments which are not subject to the legal profit-sharing system (companies with less than 50 employees) can pay their employees an exceptional bonus whose maximum amount is fixed at 1,000 € and which is exempted from any social contributions except CSG and CRDS.

This bonus should benefit every employee of the company and be paid between the 1st of January 2008 and the 30th of June 2008.

The ceiling upper limit of this bonus has been fixed at 1,000 €. Furthermore this bonus can be conditionally reduced and fractionally paid.

Should this 1,000 € limit be exceeded, the total amount of the bonus will be subject to social contributions.

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Additional information: The index-linked minimum wage might be changed on the 1st of Mai 2008

Considering the inflation acceleration the index-linked minimum wage might be increased on the 1st of Mai 2008.

The index-linked minimum wage has amounted to 8.44 € gross an hour and 1280 € gross a month (full-time basis) since the 1^st of July 2007.

It would be the 1^st application in 12 years of the principle called "sliding scale" of the index-linked minimum wage.