Payroll and Benefits Guide Reunion
Last updated: Mar 03, 2026
Contribution
| Employer Payroll Contributions | |
| 7% | Health, maternity, disability, death |
| 10.57% | Old-age insurance |
| 3.45% | Work accident insurance |
| 1% | Family benefits |
| 4.05% | Unemployment insurance |
| 18% | Supplementary pensions (Agirc-Arrco) |
| 1% | Other small funds |
| 45% | Total Employer Costs |
| Employer Payroll Contributions | |
| 7.3% | Old-age insurance |
| 12% | Supplementary pensions (Agirc-Arrco) |
| 9.5% | CSG/CRDS |
| 0.5% | Other small items |
| 29% | Total Employee Costs |
Income tax
Personal income tax in France (applies to residents in Réunion) for 2025, using progressive rates on annual taxable income:
• Up to EUR 11,294: 0%
• EUR 11,295–28,797: 11%
• EUR 28,798–82,341: 30%
• EUR 82,342–177,106: 41%
• Above EUR 177,106: 45%
Non-residents: Flat 20% on France-sourced income
PAYE Withholding: Employers deduct tax monthly and remit by the 15th of the following month
Employer taxes
Working Hours
The standard working week in Réunion consists of 35 hours, typically spread over five seven-hour days.
Overtime
| Aspect | Regulation Details | Notes |
| Maximum Ordinary Hours | The legal standard work week is 35 hours (Article L3121-27). Any hour worked beyond 35 hours per week is considered overtime (heures supplémentaires). | |
| Absolute Maximum Daily Hours | Employees generally cannot work more than 10 hours per day. | This limit can be increased to 12 hours under specific conditions (e.g., by collective agreement or for urgent work). |
| Absolute Maximum Weekly Hours | Employees cannot exceed 48 hours in a single week or 44 hours per week averaged over any 12 consecutive weeks. | |
| Annual Overtime Cap (Contingent Annuel) | Overtime is legally capped at 220 hours per year per employee, unless a Collective Bargaining Agreement (CBA) sets a different amount. | |
| Exemptions | Senior managerial and executive positions (Cadres Dirigeants) are typically exempt from the statutory working hours and overtime provisions. |
Mandatory Overtime Pay Rates
Overtime must be compensated either through pay (at a premium rate) or equivalent compensatory rest (Repos Compensateur de Remplacement – RCR), as determined by a CBA or company agreement.
In the absence of a CBA or agreement, the Labour Code mandates the following minimum premium rates:
| Hours Worked (Beyond 35/week) | Minimum Premium Rate (Supplement) | Total Pay Rate | Notes |
| $36^{\text{th}}$ to $43^{\text{rd}}$ hour (The first 8 hours of overtime) | +25% of the regular hourly wage. | 125% | This applies if no agreement is in place. |
| $44^{\text{th}}$ hour and beyond | +50% of the regular hourly wage. | 150% | This applies to any further overtime hours worked in the week. |
| Work on Public Holiday/Sunday | +100% of the regular hourly wage. | 200% | The minimum rate for work on the weekly rest day or an official public holiday. |
Note on Agreements:
A CBA can stipulate a lower premium rate than the statutory rate above, but the rate can never be less than a 10% premium on the regular wage.
Compensation for Exceeding the Annual Quota
If an employee works overtime hours beyond the annual quota (220 hours by default), the employer must provide additional compensation known as Mandatory Compensatory Rest (Contrepartie Obligatoire en Repos – COR), in addition to the standard overtime pay or rest compensation:
| Quota Exceeded Compensation (COR) | Company Size |
| 50% of the hours worked beyond the quota. | Companies with 20 employees or less. |
| 100% of the hours worked beyond the quota. | Companies with more than 20 employees. |
Payroll
Payroll in Réunion generally follows a monthly cycle, with salaries paid on the last working day of each month.
13th salary
There is no requirement for a 13th-month salary unless it is stipulated in a collective agreement or company-specific policy.
Leave
Annual Leave (vacation)
30 (2.5 working days/month) days/year after one year of service.
PTO carryover
Réunion follows French labor law. Statutory annual leave does not automatically carry over after the leave-taking period, except in specific cases (e.g., sickness, maternity/parental leave, or employer failure to allow leave). Employers cannot delete accrued statutory leave by a blanket “use-it-or-lose-it” policy; unused leave must be taken within the permitted period or validly carried over under French law.
Public Holidays
Holidays falling on the weekend are observed on the following working day(s).
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 1 May 2026 | Friday | Labour Day / May Day | Standard holiday |
| 8 May 2026 | Friday | Victory in Europe Day | Standard holiday |
| 14 May 2026 | Thursday | Ascension Day | Standard holiday |
| 25 May 2026 | Monday | Whit Monday | Standard holiday |
| 14 July 2026 | Tuesday | French National Day | Standard holiday |
| 15 August 2026 | Saturday | Assumption Day | Standard holiday |
| 1 November 2026 | Sunday | All Saints’ Day | Standard holiday |
| 11 November 2026 | Wednesday | Armistice Day | Standard holiday |
| 20 December 2026 | Sunday | Abolition of Slavery Day | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
Sick Days
Employees entitled to paid sick leave after a 3-day waiting period; paid by Social Security at 50% salary (employers may top up)
Maternity
16 weeks paid leave (6 before birth, 10 after); extended for multiple births or complications.
Paternity
Paternity leave provides twenty-eight days of paid leave, of which seven days must be taken immediately after birth.
Parental Leave
Parental leave is available for up to three years per child and is job-protected, though it is unpaid unless benefits are available under the family allowances system.
Bereavement Leave
Bereavement leave grants three to five consecutive days for the death of a spouse, parent, or child. For the death of a grandparent or in-law, one day of leave is generally provided.
Employer taxes
Termination
Termination Process
Termination of employment in Réunion must comply with the French Labor Code and can occur for economic reasons, personal reasons, or misconduct. Employers must notify the employee of a pre-dismissal meeting, hold the meeting to present reasons and allow a response, and then issue a written dismissal letter. Statutory notice periods must be observed unless the termination is due to serious or gross misconduct.
| Salary payment interval / date | Final payment on termination | Bank account payment requirement |
|---|---|---|
| Monthly for monthly-paid employees; pay is made periodically on a fixed date under the French Labour Code (rules apply in Réunion). | The employer must hand over the reçu pour solde de tout compte at the end of the contract and pay the amounts it lists (wages, unused leave, indemnities). Delivery is due at contract end; this is the point at which the sums are settled. | French law allows payment by bank transfer, cheque or cash (cash only under thresholds and conditions). There is no blanket rule forcing payment only into a bank account. (Art. L3241-1 Code du travail; Service-Public recap). |
Notice Period
During Probation
- Less than 8 days worked: 24 hours’ notice
- 8 days to 1 month worked: 48 hours’ notice
- 1 month to 3 months worked: 2 weeks’ notice
- Over 3 months worked: 1 month’s notice
After Probation (Permanent Contracts – CDI)
- Non-managerial staff (employees/workers): 1 month’s notice = 30 calendar days
- Managerial staff (cadres/executives): 3 months’ notice = 90 calendar days
Severance Pay
Employees with at least eight months of continuous service qualify for severance pay unless dismissed for serious or gross misconduct. Compensation equals one-quarter of a month’s salary per year of service for the first ten years and one-third of a month’s salary for subsequent years. The calculation uses whichever is higher of the employee’s average gross salary over the past three or twelve months.
Probation Period
Probationary periods differ by job category: two months for workers and clerks, three months for supervisors and technicians, and four months for managers.
Immigration
Non-EU and non-EEA nationals must obtain both a long-stay visa and a work permit before starting employment in Réunion. Employers apply for authorization, and the process typically takes four to eight weeks. Citizens of the EU, EEA, and Switzerland do not need a visa but must register if their stay exceeds ninety days.
Minimum Wage
As of 2025, the statutory minimum wage (SMIC) in Réunion is €1,801.80 per month for a 35-hour workweek, the same as in mainland France.
MINIMUM WAGE (PER MONTH)
VAT
Réunion uses a reduced VAT system compared to mainland France, applying an 8.5% standard rate and a 2.1% reduced rate for basic goods, with some services exempt. Businesses file VAT returns either monthly or quarterly depending on turnover levels.
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Public Holidays Calendar
| Date | Day | Holiday | Notes |
|---|---|---|---|
| 1 January 2026 | Thursday | New Year’s Day | Standard holiday |
| 6 April 2026 | Monday | Easter Monday | Standard holiday |
| 1 May 2026 | Friday | Labour Day / May Day | Standard holiday |
| 8 May 2026 | Friday | Victory in Europe Day | Standard holiday |
| 14 May 2026 | Thursday | Ascension Day | Standard holiday |
| 25 May 2026 | Monday | Whit Monday | Standard holiday |
| 14 July 2026 | Tuesday | French National Day | Standard holiday |
| 15 August 2026 | Saturday | Assumption Day | Standard holiday |
| 1 November 2026 | Sunday | All Saints’ Day | Standard holiday |
| 11 November 2026 | Wednesday | Armistice Day | Standard holiday |
| 20 December 2026 | Sunday | Abolition of Slavery Day | Standard holiday |
| 25 December 2026 | Friday | Christmas Day | Standard holiday |
Questions & Answers