What are hidden costs? Which label to choose? The federation of wage porting users, Fedep’s, takes stock of the subject matter and the guarantees offered by the labels.
What are the hidden costs of wage transfer?
The association has brought to light the practices of over-billing of employer contributions by certain payroll transfer companies. The main media, in particular Le Monde, Les Echos, the research unit of France Inter, Médiapart, Alternatives Économiques, France 3, etc., reiterated this (Portage salary: costs that are still just as well hidden). The courts have been seized by many injured workers and an investigation is underway. Far from being an isolated practice, several of the umbrella companies involved are among the largest in the market. The amounts can range from 3% to 7% of gross pay or even more, depending on the umbrella companies. Fedep’s, Association for the Defense of Workers in Wage Transfer, has compiled a list of companies and practices.
These additional costs are entered directly into the pay slip of the transported employees, or are taken off the bill by shifting them to the payroll through the use of a “retrocession coefficient” that does not correspond to the reality of the charges. The employees carried along do not notice these rules because of the technical nature of the pay slip.
However, the payroll porter is a trusted third party that collects the turnover on behalf of the porter, and takes care of the payment of salary and employer contributions for the latter…
Who is Fedep’s, the association of payroll users?
Fedep’s is a non-profit organization that represents payroll porting users and is independent of porting companies. Members are mainly supported employees, but also customer companies.
The association has been a whistleblower in this field since 2017 and assists employees and hirers in all topics related to wage transfer: legal environment, conditions for appeal for wage transfer, case analysis, handling of disputes with carriers.
The association supports employees who are victims of fraudulent practices in calculating their damages and recovering overpayments, as well as user companies in setting up monitoring of their suppliers as part of a CSR approach. Fedep’s oversees the practices of more than 40 transportation companies. And since 2020, the association has established a Label for users of payroll transfer.
The label zero hidden costs in payroll transfer
To meet the demand from many transferability candidates who want guarantees and control over the use of their assets, the association has created the Zero Hidden Costs Label. It verifies the transfer company’s compliance with the specific rules on wage transferability, and transparency on management costs: absence of hidden costs, good level of employer’s contributions deducted from the employee, absence of “retrocession coefficient” or other dexterity… This label of payroll transfer is granted after a full financial audit of the transfer applicant’s accounts during the last two years, and is then subject to control, follow-up and maintenance audits every one or two years.
The reference framework is drawn up by the Fedep association and the audit is entrusted to an independent external audit firm specializing in financial audits. The criteria are simple (no hidden costs) and strict, designed by Fedep’s, an association whose governance is determined by the members, who are only users of portage services: 95% of the employees in portage, 5% of the customers of companies. While various allegations are circulating on the sites of transport companies, the Zero Hidden Fees Label is the only independent reference in the transport sector and guarantees the absence of hidden costs. Today it is increasingly used by ethical carriers and by users and prescribers in the market.
Launched two years ago, today 9 companies are certified, representing a turnover of approximately €300 million, or 20% of the estimated market.
The road to the moralization of payroll transfers will be led by the vigilance of employees and client companies. Informed users of payroll and porting companies that have been audited and labeled Zero Hidden Fees are already contributing.