How much does an employee earning minimum wage cost?
31 March 2025 · 2 min reading time
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See job offersKnowing how much an employee paid the French minimum wage (SMIC) really costs is crucial for any company. The term “loaded SMIC” is not limited to the gross salary; it also encompasses all the SMIC-related employer contributions that are added on, thus giving a complete picture of hiring costs. In this article, we propose to decipher this notion by explaining how, starting in 2025, these expenses add to the salary and impact overall payroll management.
What is the “loaded SMIC”?
The gross SMIC corresponds to the legal minimum wage indicated on the employment contract, before any deduction of social contributions. In contrast, the net SMIC represents the amount actually received by the employee once social contributions and other deductions have been taken from the gross salary. As for the loaded SMIC, it designates the total cost borne by the employer to remunerate an employee paid the SMIC, including not only the gross salary but also all the employer contributions and levies added to it. These three notions therefore make it possible to clearly distinguish what the employee earns, what is officially declared, and what the company really spends for each hire.
Calculation of the loaded SMIC 2025
Let us take the example of an employee paid the SMIC in 2025, with a gross salary of € 1 801.80 for full-time work (35 hours per week). According to URSSAF, the loaded SMIC for this employee amounts to about € 1 881 per month. To understand this result, one can apply an employer-contribution rate of about 4.4 %. Indeed, 4.4 % of € 1 801.80 represents about € 79.28 (€ 1 801.80 × 0.044 ≈ € 79.28). By adding this amount to the gross salary, one obtains € 1 801.80 + € 79.28 ≈ € 1 881.08, which, when rounded, gives about € 1 881. This calculation clearly illustrates how, despite a gross SMIC of € 1 801.80, the employer’s real cost increases because of social charges, resulting in a loaded SMIC of about € 1 881.
A reduction in employer contributions for employees on the SMIC
In the case of the SMIC, the percentage of employer contributions applied is generally lower thanks to specific exemptions and relief measures. For example, for salaries below 1.6 × SMIC, certain URSSAF contributions are cancelled or reduced thanks to the “zero URSSAF contribution” scheme, which significantly decreases the employer’s total cost. These incentive measures aim to promote the hiring of young people and entry-level employees by easing the financial burden linked to contributions, and thus help maintain companies’ competitiveness while facilitating professional integration.
How much does an employee on the SMIC really cost?
In addition to mandatory employer contributions, hiring an employee remunerated at the SMIC generates various additional expenses. It is therefore necessary to take into account not only the gross salary but also indirect costs, such as setting up the employee’s workstation (including the purchase of a desk, a computer or other equipment), as well as benefits that do not appear in the net salary, such as paid-leave allowances, the partial reimbursement of public-transport costs, meal vouchers, or even a profit-sharing bonus. This comprehensive approach makes it possible to assess precisely the total financial impact of a hire, an essential factor for effective payroll management.
Practical advice for optimising employer contributions
For companies wishing to optimise their hiring cost at the SMIC, several strategies can be considered. It is recommended to stay informed about legislative developments and available exemption schemes, in order to benefit from contribution relief whenever possible. Furthermore, rigorous management of the payroll, including a regular evaluation of positions and indirect costs, makes it possible to better anticipate and control the overall financial impact
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