The status of Junior-Enterprises threatened

The company DELSOL Avocats announced at the beginning of August 2022 to support the National Confederation of Junior-Enterprises, which brings together almost 200 Junior-Enterprises, to secure their legal status, which is currently under threat. On Tuesday, September 6, the entire Junior-Enterprise Movement came together to clarify the situation and define the next steps needed to protect the brand.

Junior-Enterprises, student associations like no other

ONE Junior company is a student association that gives students the opportunity to become more professional. Junior-Enterprise is run entirely by student administrators who form the link between their clients and student Intervenors who carry out the missions for the clients. Junior-Enterprises make it possible to put the theoretical lessons at schools or universities into practice, so that students improve their skills and benefit from better professional integration. Junior-Enterprises are thus non-profit associations with an economic vocation.

In France, Junior-Enterprises are supervised by the National Confederation of Junior-Enterprises (CNJE), an association under the law of 1. July 1901, which is an association of around 200 Junior Enterprises in the country. It brings together more than 25,000 students and is the leading student union movement in France.

The question of the status of Junior Enterprises

The Junior Enterprise model is now being questioned. Junior companies are not subject to any legal text, apart from Bérégovoy’s 1984 letter defining their derogatory tax status and the 1988 letter and ministerial decree defining their derogatory social status. However, these texts do not constitute laws and can therefore be questioned. The status of the students who carry out the missions in the Junior-Enterprise is also not defined by law, and therefore it is threatened today.

ACOSS (Central Agency of Social Security Organisations) and URSSAF (Unions for collection of social security contributions and child allowances), which rely on a judgment handed down by the Court of Cassation on 15 June 1988, believe that there is a subordinate relationship between Junior Companies and the students who carry out the missions for the customers. This subordination contributes to the vagueness of the situation, since it is also not a concept defined by law, but by jurisprudence, and therefore depends on the analysis of the facts according to the judge. This interpretation would mean that the services performed by the students involved in Junior-Enterprise could be considered to be linked to an employment contract. If this were the case, the Junior companies would therefore be subject to other social contributions which they do not pay today due to their derogatory status. The social services thus question Junior-Enterprise’s pejorative status.

Concretely, the Junior companies will risk being requalified as employers, which means that they must pay the common law contributions and social contributions. The consequences would be none other than the end of the Junior-Enterprise model as it exists today, and most of them would have no choice but dissolution or financial liquidation.

Also read: Emilie Paris looks back on her chairmanship at CNJE

DELSOL Avocats assists CNJE

The firm DELSOL Avocats announced last August to support and advise the CNJE on this situation to protect the Junior-Enterprise brand and its status. According to the company DELSOL Avocats, the requalification of Junior-Enterprises as employers would be the exact opposite of the educational vocation in the missions that students in Junior-Enterprises carry out. It would also create other obligations which would create problems in the current operation of Junior-Enterprises, such as the withholding tax, which relates only to wages. However, the presenters in Junior-Enterprise receive a fee, which has never been questioned. This requalification would also limit the freedom to organize and manage their time available to speakers during their missions.

Contributions such as those for accidents at work must be paid, but these only make sense to an employer who insures his employee. The disciplinary power found in a traditional enterprise would be legitimate, while it is not possible to make use of it today in the Junior-Enterprise.

According to the company, the conditions are thus not met for the students to be recognized as subordinate employees in Junior-Enterprise or for a working relationship to be established.

Go through the law to clarify the status of Junior Enterprises

CNJE, with the help of the company DELSOL Avocats, contacted ACOSS and UNEDIC (national interprofessional trade union for employment in industry and commerce) to inform them of these difficulties, which has so far not been without success. It is therefore urgent today to define the status of junior companies in a legal text and delimit the contributions that concern them.

The CNJE has therefore decided to seek the support of the law firm, the ministers responsible for the case and the parliamentarians with a view to the discussion in parliament of the Social Security Funding Bill (PLFSS) planned for 2023. The aim is to implement the ministerial letters and decrees underlying the derogation scheme for younger companies into law by providing a definition in a text that should appear in the Social Security Act.

Maître Camille Rousset, partner, co-head of the “Employment Law – Social Protection” department and mediator at DELSOL Avocats, has been tasked with drafting an amendment that will be submitted to ministers and parliamentarians before the end of 2022.

Junior-Enterprises’ commitment

The entire movement of Junior-Enterprises in France met on Tuesday, September 6, on the occasion of an Extraordinary General Assembly of Presidents to discuss the emergency strategy put in place by the CNJE, accompanied by the DELSOL Cabinet Avocats and its Strategic Orientation Committee.

The next steps necessary to protect the Junior-Entreprise mark have been defined for each of the structures. According to Yanis Gannounichairman of CNJE, and Marie Trüb, deputy chairman, it is above all a question of:

– solve the problem and protect the Junior companies;

– simplify the Junior-Enterprise model;

– introduce the Junior-Enterprise concept to customers.

As Yanis announced when he took office last July: “ The first project (of his mandate) will be to clarify the status of junior companies. It seems that all the junior entrepreneurs in France are working with him to clarify their situation and ensure the sustainability of this movement that has been going on for 55 years.

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