Sunnyvale, CA -- (SBWIRE) -- 03/29/2012 -- France has passed legislation enforcing French companies to disburse a bonus to their employees when dividend paid to shareholders exceeds the average of last two fiscal years and when such companies’ employee count is 50 or more.

Companies with subsidiaries in France may need to review their dividend distribution policy. Group companies whose holding company is in France also fall under the ambit of this legislation. The law applies to all dividend distributions made from January 1, 2011.

The legislation does to specify the amount of bonus to be paid out, employers will need to negotiate the amount with union or employee representatives.

Employers who refuse to negotiate a payment may even face prison sentences. The number of employees a company has, however, affects the bonus payments.

Bonus payable is exempt from Social Security Contribution up to € 1200 annually, per employee.

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