Until 31 August 2023, employers had to pay a flat-rate contribution amounting to 20% of the severance allowance paid to employees (up to a cap set each year, i.e., €87,984 in 2023).
Article 4 of the Social Security Amendment to the Financing Bill for 2023 (including the pension reform), adopted on March 20, 2023 increased the amount of this specific contribution to 30%
Any mutual termination agreement (MTA) providing for an end of employment beyond September 1st, 2023 is subject to this increased rate.
This modification, increasing the cost of MTAs for employers, will make it more difficult for employees to benefit from such a scheme, especially when they are taking the initiative of such termination.