Popular with French companies and young graduates alike, the V.I.E. scheme remains limited in time due to regulations. However, a solution exists to perpetuate the advantages of this scheme.
We will first describe how V.I.E. works and then discuss how to maintain a «win-win» scheme in full compliance.
Business France manages this mechanism developed jointly by the French Ministry of Economy and Finance and the Ministry of Foreign Affairs to promote the development of France’s foreign trade.
The VIE, as well as the lesser-known V.I.A (Volontariat International en Administration), allow a young graduate to carry out a professional mission abroad for a significant period at the beginning of his or her professional life and this, perfectly framed on the legal level.
The applicant for this mobility must meet the following conditions:
- be of European nationality
- hold a higher education degree
- be between 18 and 28 years of age on the day before departure on a mission abroad
Initially developed as an alternative to French military service, the formula is now also aimed at young women.
A French company that has an entity abroad can offer a V.I.E. to the young graduate by entrusting him/her with an assignment in this structure outside of France.
By carrying out this professional mission abroad, this young person will have the status of a public agent of the Ministry. He or she will not have a contractual relationship with the company but will sign a letter of commitment with Business France, which will take care of the formalities for obtaining a visa, if necessary, the management of his or her social security coverage and the payment of his or her salary.
After signing an agreement with the French company, Business France will invoice the company every month with the VIE’s salary, social security coverage and management fees.
This formula is very advantageous for the young V.I.E. as it gives them access to international professional experience at the very beginning of their career and for a significant period of time (assignments are possible for periods of 6 to 24 months).
In addition to an internship allowance, he/she will receive a net social and fiscal remuneration called IFE (Indemnité Forfaitaire d’Entretien) composed of a fixed part identical to all international volunteers of 749.33 € since July 2022 completed by a geographical allowance whose amount varies according to the cost of living of the place of assignment. A housing allowance may be added to these emoluments set by the State.
Good social protection including pension insurance, health insurance for the young person, and even for his/her spouse if married, and personal liability insurance are added to the package.
Finally, the V.I.E. benefits from an excellent network of graduates with the same status.
As for the French company, there are many advantages: decentralised administrative management via Business France, means of «testing» the young graduate before hiring him or her, reduced cost of the IFE compared to expatriation.
In addition to these numerous advantages, the ultimate one is that of being able to benefit from a qualified resource not counted in the company’s workforce, which proves invaluable in a recruitment freeze situation.
Also, the company will want to extend such a windfall but the regulations are clear: a VIE can be renewed once without ever exceeding 24 months (18 for the USA due to immigration constraints).
Let us now look at the formula of the Professional Employment Outsourcing (PEO). This involves using a company external to the Group) which becomes the employer of the employee in the host country (and takes care of the formalities relating to
- Immigration: visa application, residence permit, work permit
- Legal: drafting of the employment contract in the host country and payment of the local salary
- Social security: payment of compulsory local social security contributions
- Tax: payment of personal income tax in the host country
The Professional Employment Outsourcing company will sign a contract with the client company and then send it a monthly invoice including the gross salary of the employee (agreed net salary + local social security contributions and local taxes) as well as its management costs.
There are many reasons to be interested in the Professional Employment Outsourcing solution : no visibility on the long-term integration of the employee, saving time and money, no more quota to hire an expatriate in the host country and the need for qualified resources in a context of hiring freeze in the Group.
Also, Professional Employment Outsourcing is an ideal way to keep a young graduate who has proven himself for several months in the host structure, without integrating him into its workforce, without a time limit, while continuing with a decentralised administrative management.
