Overtime: Bonus Rates and Legal Calculation

Introduction

Overtime is a central subject in French labour law. Whether it is an employer wishing to optimise their payroll or an employee wanting to know their rights, mastering the rules of bonus and legal calculation of overtime is essential. Governed by the Labour Code, these hours are subject to a precise regime: bonus rates, annual allowance, tax and social exemptions, compensatory rest. This article reviews the entire system applicable in 2026, based on current legislation and the latest regulatory developments.

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Definition and Scope of Application for Overtime

What is an Hour of Overtime?

According to article L.3121-28 of the Labour Code, any hour worked beyond the legal weekly working duration — set at 35 hours — constitutes an hour of overtime. This threshold is assessed on a calendar week basis (from Monday 00:00 to Sunday 24:00) unless a collective agreement provides for another reference period.

Note: only hours requested or accepted by the employer fall within this framework. An hour worked spontaneously, without the approval of management, may be reclassified, but the employer cannot systematically oppose this argument if the hours performed were necessary to carry out the assigned tasks.

Employees Covered and Exclusions

The overtime regime applies to full-time employees subject to the legal duration or a contractual duration of less than 35 hours. Excluded are:

• Senior executives (article L.3111-2 of the Labour Code);

• Employees on annual day-based contracts (article L.3121-58);

• Self-employed workers.

For part-time employees, hours worked beyond their contractual duration are supplementary hours, subject to a separate regime.

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Legal Bonus Rates Applicable in 2026

The Two Bonus Tiers

The legal bonus rate for overtime is set out in article L.3121-36 of the Labour Code:

• 25% bonus for the first 8 hours of overtime in the week (from the 36th to the 43rd hour);

• 50% bonus from the 9th hour of overtime onwards (from the 44th hour).

These rates constitute the legal minimum. A sectoral or company agreement may provide for higher rates, but never lower ones (an extended sectoral agreement may, however, reduce the rate for the first 8 hours to a minimum of 10%, according to article L.3121-33).

Concrete Calculation Example

Let's take an employee whose gross hourly wage is £15 and who works 42 hours in the week:

• Standard hours (35h): 35 × £15 = £525

• Overtime hours from 36th to 42nd (7h) at +25%: 7 × £15 × 1.25 = £131.25

• Total gross for week: £656.25

If this same employee works 46 hours:

• 35 standard hours: £525

• 36th to 43rd (8h) at +25%: 8 × £15 × 1.25 = £150

• 44th to 46th (3h) at +50%: 3 × £15 × 1.50 = £67.50

• Total gross for week: £742.50

Replacement with Equivalent Compensatory Rest

The employer may, under certain conditions, replace all or part of the bonus payment with compensatory rest for replacement (RCR), in accordance with article L.3121-37. This rest must be equivalent to the bonus remuneration: for an hour at 25%, the rest awarded is 1h15; for an hour at 50%, it is 1h30.

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The Annual Overtime Allowance

Definition of the Allowance

The annual allowance represents the maximum number of overtime hours an employee can work in a calendar year without prior administrative authorisation. It is set by collective agreement or, failing that, by decree.

In the absence of an agreement, the regulatory allowance is 220 hours per year (article D.3121-24 of the Labour Code). A collective agreement may adjust this volume upwards or downwards.

Exceeding the Allowance

Hours worked beyond the allowance are possible but grant the right, in addition to the salary bonus, to a mandatory compensatory rest entitlement (COR):

• 50% of hours exceeding the allowance in companies with 20 or fewer employees;

• 100% in companies with more than 20 employees.

These rest entitlements must be taken within two months following their acquisition and their rigorous management is now facilitated by compliant HR management tools, particularly through the digitalisation of working time tracking documents.

Tracking and Traceability: The Question of Proof

The employer is required to maintain an individual count of working time (article L.3171-4). In the event of an employment tribunal dispute, the burden of proof is shared: the employee must present sufficiently precise information, with the employer required to rebut with its own records. Digitalisation and electronic signature of timesheets strengthen the probative value of these documents, as emphasised in our comprehensive electronic signature guide.

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Tax and Social Regime for Overtime

Income Tax Exemption

Since the TEPA Act of 2007, renewed and strengthened by the Act of 16 August 2022 (purchasing power act), remuneration received for overtime is exempt from income tax up to a limit of £7,500 per year (article 81 quater of the General Tax Code).

In practice, an employee who receives £3,000 in overtime payments in the year will pay no tax on this amount, regardless of their marginal tax bracket.

Reduction in Employee Contributions

Overtime also benefits from a flat-rate reduction in employee contributions (excluding sickness and maternity contributions payable by the employee) up to the amount exempt from income tax. In practice, the reduction rate applicable in 2026 is 11.31% for companies with fewer than 50 employees and 11.31% also for larger ones (rates harmonised since 2019).

Impact on SMIC Calculation and Indemnities

Overtime is taken into account in the calculation of the SMIC (minimum wage): the employer must ensure that total remuneration, including overtime, is at least equal to the enhanced hourly SMIC. Conversely, for the calculation of redundancy indemnities, notice pay or holiday pay, only habitual remuneration (excluding exceptional overtime) is generally retained, unless a more favourable agreement applies. The digitalised management of these elements via a electronic signature solution for HR makes it possible to secure the entire documentary chain.

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Employer Obligations and Non-Compliance Risks

Information and Consultation of the Works Council

The employer wishing to regularly resort to overtime must inform the Works Council (CSE) in companies with more than 11 employees. This information covers the projected volume, the services concerned and the compensation measures.

Furthermore, any collective agreement modifying the allowance or bonus rates must be negotiated with union representatives and filed with the DREETS. The signature of these agreements is now routinely carried out in electronic format, in accordance with the eIDAS regulation which guarantees their legal value across Europe.

Penalties for Non-Compliance

Non-payment or reduction of the bonuses owed constitutes a labour law crime punishable by a fine of €45,000 and 3 years' imprisonment for individuals (article L.8224-1 of the Labour Code). The URSSAF may proceed with a reassessment covering the last 3 years.

Practices such as informal "recovery" of overtime through unstructured rest days, or lack of precise counting, expose the employer to employment tribunal convictions with back pay plus bonus and damages.

Archiving and Document Retention

The employer is required to retain time records and payslips for 5 years (limitation period for wages, article L.3245-1). The digitalisation of these documents, combined with a qualified electronic signature, guarantees their integrity and enforceability in the event of inspection or dispute, as detailed in our guide on electronic signature in the workplace.

Legal Framework Applicable to Overtime

The overtime regime is based on a dense legislative and regulatory foundation that must be mastered to ensure complete compliance.

Labour Code — Key Provisions

• Article L.3121-28: definition of overtime beyond 35 weekly hours.

• Articles L.3121-33 to L.3121-37: legal bonus rates (25% and 50%), possibility of compensatory rest for replacement, role of collective agreements.

• Article L.3121-38: annual allowance and mandatory compensatory rest entitlement.

• Article D.3121-24: setting of the regulatory allowance at 220 hours in the absence of an agreement.

• Article L.3171-4: obligation to count working time and probative value of records.

• Articles L.8221-1 and L.8224-1: definition and penalties for hidden work.

• Article L.3245-1: five-year limitation period for wage claims.

General Tax Code

• Article 81 quater: exemption from income tax on overtime remuneration up to £7,500 per year.

Act No. 2022-1158 of 16 August 2022 (emergency measures act for consumer price protection): increase in the ceiling for tax and social exemption, maintenance of the flat-rate reduction in employee contributions.

Probative Value of Electronic Documents

The digitalisation of timesheets, payslips and collective agreements falls within the eIDAS Regulation No. 910/2014 (and its eIDAS 2.0 revision currently being transposed), which gives equivalent legal value to qualified electronic signatures and their documents throughout the European Union. In French law, article 1366 of the Civil Code establishes the principle of equivalence between electronic writing and paper writing, provided that the identity of the author is duly guaranteed and the document is kept under conditions ensuring its integrity. Article 1367 sets out the requirements for an electronic signature.

GDPR No. 2016/679: working time data constitute personal data. The employer is responsible for processing and must guarantee their security, minimisation and set a retention period in accordance (5 years for payslips). Any HR management or electronic signature provider acting on behalf of the employer is a data processor within the meaning of article 28 of the GDPR, bound by a documented data processing agreement.

In the event of URSSAF inspection or labour inspection, the production of intact and time-stamped electronic documents constitutes admissible and robust evidence, provided that the solution used complies with ETSI EN 319 132 standards relating to advanced electronic signature formats (XAdES, PAdES).

Usage Scenarios: Overtime Management and Digitalisation

Scenario 1 — An 80-Employee Industrial SME During Peak Activity

An SME in the manufacturing sector, employing 80 operators in two 8-hour shifts, faces a surge in orders in the final quarter. It plans 6 to 8 hours of overtime per week per employee for 10 weeks. Without a digitalised tracking tool, the HR department juggles between Excel spreadsheets, handwritten paper slips and payslips corrected after the fact.

By deploying an integrated time management solution with an electronic signature module, the SME enables each team leader to electronically validate weekly sheets in less than 2 minutes. The data feeds directly into the payroll software, reducing input errors by 70% (range observed in industrial SMEs according to ANDRH sectoral reports 2024). The HR department saves approximately 15 hours of administrative processing per month.

Scenario 2 — An Engineering Consultancy of 25 Collaborators

An engineering consultancy employs non-executive engineers subject to the legal duration. During intense project phases, some collaborators regularly exceed 43 hours per week. Management must imperatively distinguish hours falling within the allowance from hours giving rise to the mandatory compensatory rest entitlement (COR).

Thanks to a document generator and the digitalisation of temporary amendments, the consultancy formalises each request for overtime exceeding the allowance with an electronically signed amendment, with certified time-stamping. In the event of URSSAF inspection or employment tribunal dispute, each hour is traceable and the probative value of the documents is impeccable. The processing time for requests drops from 3 days (post, scan, return) to less than 4 hours.

Scenario 3 — A Distribution Group with 350 Employees Managing Multiple Sites

A distribution network comprising about ten outlets and approximately 350 employees must centralise overtime tracking across variable schedules. The multiplicity of sites and section managers generates inconsistencies in overtime reporting, exposing the retailer to recurring URSSAF reassessments.

The integration of a SaaS electronic signature platform enables store managers to numerically validate daily records, with automatic alerts when the 220-hour annual threshold approaches for an employee. Head office benefits from a consolidated real-time dashboard. Result: 85% reduction in pay anomalies related to overtime during the first two quarters of roll-out, and virtual elimination of disputes related to bonus calculation errors.

Conclusion

Overtime is subject to a precise legal framework: bonus rates of 25% and 50%, an annual allowance of 220 hours, tax and social exemptions capped at £7,500, mandatory compensatory rest for overages. Every employer must ensure rigorous tracking of hours worked to avoid URSSAF reassessments and employment tribunal disputes.

Digitalisation of working time documents — weekly sheets, amendments, collective agreements — now represents the best guarantee of compliance and operational efficiency. Certyneo supports you in this transition with a B2B electronic signature solution compliant with eIDAS, specifically designed for HR and legal teams.

Ready to secure your HR document management? Discover Certyneo pricing and start your free trial today.