Comply with the law on collective work organization

This note on collective work organization has been drawn up for the attention of managers/administrators of companies employing or planning to employ 10 or more people.

I - Employee delegates (articles 430 to 463 of the Labour Code)

Under Moroccan law, any company employing at least ten (10) permanent staff must elect employee representatives.

The employee representative is elected by the company's employees in accordance with regulatory texts. Its mission and the guarantees it enjoys are also defined by legislation.

The number of employee delegates is determined by the number of employees in the company.

 

From 10 to 25 employees → 1 full delegate and 1 alternate delegate ;
20 to 50 employees → 2 " and 2 " ;
51 to 100 employees → 3 " and 3 " ;
101 to 250 employees → 5 " and 5 " ...
The law punishes both non-compliance with the timetable set by the government authority and failure to hold employee delegate elections. As a result, the company incurs both criminal penalties, i.e. a fine of between 2,000 and 5,000 dirhams where the dates and procedures for organizing the elections have not been respected, and a fine of between 25,000 and 30,000 dirhams where the elections have not been organized.

II - The works council (articles 464 to 469 of the Moroccan labor code):

Any company with at least 50 employees must set up a consultative committee known as a "works council".

Admittedly, the French Labor Code does not specify how the 50-employee threshold is to be assessed.

However, in our view, the latter should be assessed globally, and take into account all employees working for the company, whether on fixed-term or open-ended contracts, temporary or permanent.


Article 465 stipulates that the Works Council comprises :
- The employer or his representative
- Two employee delegates elected by the company's employee delegates
- One or two union representatives in the company, where applicable.

The Committee's role is essentially consultative, and it does not make any major decisions concerning the management of the company. In accordance with the provisions of article 466, the committee's consultative role covers the following matters:

- structural and technological transformations to be carried out within the company ;
- the company's social balance sheet when it is approved;
- the company's production strategy and ways of increasing profitability ;
- developing and implementing social projects for the benefit of employees;
- apprenticeship programs, training-integration programs, programs to combat illiteracy and ongoing employee training.

Failure to comply with these provisions exposes the employer to a fine of between 10,000 and 20,000 dirhams.

3rd point arising from the collective organization of work, III - The health and safety committee :

Following the example of the provisions relating to works councils, any company employing 50 people must set up a health and safety committee, failing which the employer is liable to a fine of between 2,000 and 5,000 dirhams.

The committee comprises :
- the employer or his representative, Chairman ;
- the head of the safety department or, failing that, an engineer or technical manager working in the company, designated by the employer;
- the company doctor ;
- two employee delegates, elected by the employee delegates ;
- one or two trade union representatives, where applicable.

Its missions are as follows:
- detect occupational hazards to which company employees are exposed;
- ensure compliance with health and safety legislation and regulations;
- ensure the proper maintenance and use of devices protecting employees against occupational hazards;
- protect the environment in and around the company;
- encourage all initiatives relating in particular to work methods and procedures, and the choice of materials, equipment and tools required and adapted to the job;
- put forward proposals for the rehabilitation of disabled employees within the company;
- give its opinion on the operation of the occupational medical service;
- develop a sense of occupational risk prevention and safety within the company.

The occupational physician (articles 304 et seq.) :

The occupational physician's role is essentially preventive. The occupational physician must be registered with the Conseil de l'Ordre and have authorization to practice. He or she is bound by a contract with the employer or the president of the inter-company service.

His work within the company involves a number of actions. It carries out medical examinations on hiring and periodic surveillance. It may require additional examinations on hiring, at the employer's expense.

Under article 319 of the French Labor Code, the occupational physician may, by way of exception, provide care in an emergency, in the event of accidents or illnesses occurring on the premises, or to any employee who has suffered an accident at work, where the accident does not entail an interruption in the employee's activity.

Failure to set up a medical service is an offence under article 335 of the Labor Code, punishable by a fine of between 2,000 and 5,000DH .

IV - Professional union and union representative ( articles 396 to 429 and articles 470 to 474 )

The purpose of professional unions is to defend, study and promote the economic, social, moral and professional interests, both individual and collective, of the categories they represent, and to improve the level of education of their members.

They also participate in the formulation of national economic and social policy. They are consulted on all disputes and issues relating to their area of competence.

The most representative trade union having obtained the highest number of votes in the most recent professional elections within the company or establishment has the right to appoint, from among the members of the trade union office in the company or establishment, one or more trade union representatives as follows:

- 100 to 250 employees 1 union representative ;
- From 251 to 500 employees, 2 union representatives ...

Please do not hesitate to contact us if you have any legal questions about collective work organization.

We will be happy to provide you with further information.

Best regards,

Faithfully yours,

Ilham Taha-Bouamri
Chartered accountant and tax specialist

FLASH INFO: Main provisions of the 2022 Finance Act

This article has been written to take account of the main provisions of the Finance Act for 2022.

On December 20, the Finance Act for 2022 was published in Bulletin Officiel N° 7049 bis.

The Finance Act for 2022 has undergone a series of amendments. This note will focus on the main amendments relating to corporate and personal taxation.

1- Broadening the basis of application of the social solidarity contribution on profits for 2022:
Articles 11-IV, 267 to 273 of the General Tax Code

This contribution will apply to companies and individuals with professional or agricultural income determined according to the real net income system and whose net profit exceeds 1 million dirhams at the following rates:

[table id=1 /]

Companies permanently exempt from corporate income tax are excluded from the scope of this contribution.

This contribution has not been renewed for individuals holding :

Salary income
Profits and property income
Income and capital gains
It should be noted that one of the new features of the FLA 2022 is the application of CSS to companies benefiting from temporary exemptions.

This is the case for companies based in Casablanca Finance City and the Industrial Acceleration Zone.

2- Reduction in the marginal rate of corporate income tax from 28% to 26% for industrial companies with net income of less than MAD 100,000,000, in respect of their net income corresponding to their local sales:
Article 19-I-A of the C.G.I-9

Downward revision of the corporate income tax rate applicable to companies in the industrial sector with net income of less than MAD 100 million.

From now on, these companies will be subject to a corporate income tax rate of 26 % instead of 28 % in the past.

3- Eliminate progressive rates from the current corporate tax scale and adopt proportional rates to ensure convergence towards a unified rate;
The corporate income tax rates remain unchanged (see below), but instead of being progressive, they are now proportional.

[table id=3 /]

For example, for taxable income of 700,000 dirhams, the applicable corporate income tax rate will be 20 % on all taxable income, rather than 10 % for taxable income of 300,000 dirhams and 20 % for taxable income of 400,000 dirhams.

Net taxable profit on export sales is still taxed at the reduced rate of 20%.

4- Lowering the minimum contribution rate from 0.50% to 0.40%:
Article 144-I-D of the CGI

Article 144-I-D of the LF 2022 provides for a reduction in the minimum contribution rate from 0.50% to 0.40% for companies whose current income excluding depreciation is declared positive.

However, the rate of 0.60% remains applicable if current income excluding depreciation is in deficit for the last two consecutive years, beyond the exemption period during the first 3 years of operation.

The new measure applies to fiscal years beginning on or after January 1, 2022.

5- Adaptation and improvement of the Single Professional Contribution regime instituted by the 2021 Finance Act
Article 40-I of the CGI

The 2022 Finance Law provides for standardization of the Single Professional Contribution by reducing the number of occupational categories and coefficients used to determine the tax base. The number of occupational categories is now reduced to four (4):

commerce, services, manufacturing, trade and specific activities.

The 2022 Finance Act has revised the margin coefficients to be applied to each category of profession.

At the same time, it repealed the table annexed to the General Tax Code for determining the single business contribution system for income tax purposes, as set out in article 40.

From January 1, 2022, individuals whose professional income is determined under the CPU system will be subject to income tax as follows:

CPU = (Sales x Coefficient) x 10 % + additional fee
You will also find an article dedicated to the new "Contribution Professionnelle Unique" scheme...

6- Extension of the income tax (IR) exemption for income paid to employees for the first time until December 31, 2022.
Extension of the special income tax exemption scheme for newly-hired employees between January 1, 2021 and December 31, 2022.

This scheme, adopted as part of the 2021 Finance Act, was intended only for employees recruited during 2021.

At the end of this brief presentation of the main provisions of the Finance Act 2022, we note that it brings together all the pillars necessary for Covid 19's post-crisis economic recovery.

In addition to these main benefits, a number of other tax measures have also been introduced. These can be studied separately on a case-by-case basis, at the request of the interested party.

For further information on the 2022 Finance Act, our legal and tax team is at your disposal.

Faithfully yours

Ilham Taha-Bouamri
Chartered accountant and tax specialist

All you need to know about paid annual leave

* Annual leave
All employees are entitled to paid annual leave after 6 months' continuous service with the same company or employer, in accordance with Chapter IV of Title III of Book II of the French Labor Code.

Article 231 of the French Labor Code therefore provides that the number of days of monthly leave varies, after 6 months of continuous service, according to the following cases:

First, the calculation of days:
- 1 ½ days per month of actual work, i.e. (26 days or 191 hours) for employees aged 18 and over;

- 2 days per month for those under 18.

2- calculating annual leave: for example, the case of an employee over the age of 18
Annual leave is set at one and a half days' actual work per month of service, i.e. a maximum of 18 days' paid leave.

Consequently, to calculate these 18 days, we have to base ourselves on the CNSS declaration system.

The French Labor Code sets the working week at 44 hours, i.e. 8 hours a day from Monday to Friday and 4 hours on Saturday. Despite this, Saturday is still counted as a full day for CNSS declaration purposes, so cannot be declared (5.5 days). The same system is applied for vacation deductions.

The employee is therefore entitled to 18 working days per year of actual work (i.e. 3 weeks from Monday to Saturday 3 X 6 days = 18 days).

3- Obligation to take leave
Taking annual leave is compulsory. Most employers believe that leave can be replaced by a compensatory payment.

This is prohibited by article 242 of the Labour Code, which reads as follows:

"Any agreement relating to the prior renunciation of the right to paid annual leave or to the abandonment of said leave, even in exchange for the granting of a compensatory indemnity, is considered null and void."

However, paid annual leave may, by agreement between the employee and the employer, be split or accumulated over two consecutive years (article 240 of the French Labor Code).

4- Bonus for seniority leave :
Similarly, an additional 1 ½ days per year for every 5 years of continuous or discontinuous service, up to a maximum total leave of 30 working days.

5- Increase the duration of leave by as many days as there are paid days off (usually public holidays) during the leave.
Sick leave does not count as paid annual leave.

6- Period of actual work taken into account in calculating leave :

- Previous leave ;
- Advance notice;
- Military service;
- Absence due to illness or accident, duly certified ;
- The period before and after a woman gives birth;
- Periods of incapacity following an accident at work or occupational disease
- Periods of absence for family events, sports competitions or communal activities ;
- Authorized absences not exceeding 10 days/year
Last Periods of closure by judicial or administrative decision or due to force majeure.

7- Vacation pay :
This indemnity is due to any employee whose contract is terminated before he or she has benefited from the leave, and who can prove that he or she has at least 1 month's service. The indemnity is equal to 1 1/2 days per month worked, and is payable with the last salary.

Consequently, in the event of the employee's death, this indemnity will have to be paid in full to his or her spouse, for example, or to his or her descendants or ascendants.

Employees on fixed-term contracts must exhaust their leave before the contract expires.

8- Employment and work of an employee on leave :
It is then strictly forbidden to keep the employee busy during the leave, even outside the company.

It is also forbidden to employ a worker from another company while he or she is on leave.

The employee on leave is not able to perform paid work.

9- Leave for occupational injury or illness.
In conclusion, the leave of an employee who has suffered an accident at work is postponed until the injury has been consolidated.

So please don't hesitate to contact us if you have any questions you'd like us to answer or clarify.

The accounting firm Fiscal & Légal Team can also provide you with support and expertise in the fields of accounting, taxation and legal matters:

Business start-ups ;
Bookkeeping
Social Expertise and HRM
Legal advice
Processing pay slips ;
Tax optimization;
Outsourcing accounting and tax returns ;
Digitization
Direct debit
Company support


Faithfully yours,

Ilham Taha-Bouamri
Chartered accountant and tax specialist