Employee contributions: definition
Employee contributions refer to social security contributions payable by employees. They are deducted by employers from the gross salary of their employees and are then paid to collection organizations such as Urssaf. Employee contributions, like employer contributions, are used to finance social benefits such as:
- health insurance,
- unemployment insurance,
- retirement pensions,
- family allowances,
- housing allowances,
- social minima,
- workers’ compensation benefits.
The employee contributions are part of the social charges with the employers’ charges. An employee’s net salary is equal to his gross salary plus paid vacation allowances, bonuses and overtime less employee contributions. Employee contributions include social security contributions paid to Urssaf, social security contributions paid to Urssaf, unemployment contributions paid to Urssaf, supplementary pension contributions paid to pension and provident organisations.
To note: the unemployment insurance employee contribution has been abolished since 1 October 2018.