A salary paid in cryptocurrency to protect your money: is it legal?

The tax authorities have tried to have direct and permanent access to all transactions carried out in all bank accounts opened in France.

➡ Paying a salary in cryptocurrency to escape the clutches of Bercy is attractive. But… is it legal?

Currently, French law allows partial compensation cryptocurrency.

The article L143-1 of the Labor Code states that: salary payment must be made in fiat currency which is legal tender in France “and” salary must be paid in cash, crossed check or transfer to a bank or postal account» according to article L3241-1 of the same code.

However, the article L143-1 which required employers to pay wagesin metallic or fiduciary moneyit was abolished a few years ago. Today, no article of the French Labor Code mentions mandatory payment in euros.

In addition, judicial practice has been expressing itself on this subject by recalling the above articles of the Labor Code. Salary payment can only be made in the currency that is legal tender in France, either in euros or in any other internationally recognized currency. Thus, since France does not recognize any legal value for cryptocurrencies, the payment of wages is prohibited.(CA Chambery, June 4, 2021)

On the other hand, French law authorizes the collection of part of his salary in a form other than fiat currency which is legal tender in the national territory.

Technically, it would be possible to collect risk, cold, Sunday or night work bonuses in cryptocurrency through a BTC or ETH address. GMO Internet Group in Japan has already implemented this bitcoin bonus system for their employees; This idea comes from the time when bosses offered rewards to their employees through shopping coupons.

➡ However, the law of 1er February 2016 stipulates that merchants and employers cannot reject an IBAN based on a country code. Rejection of a foreign RIB is not legal, as long as the country is part of the SEPA area.

So as long as the majority of the salary is collected in fiat currency in a bank account, this is still possible.

Therefore, the difficulty lies in the payment in cryptocurrency since the problem most often comes from the bank account since it is housed by a crypto bank. Most often, these bank accounts are assigned a foreign IBAN. Provided that the foreign RIB is not in the SEPA area, the law of 1er February 2016 cannot be applied.

today Paying in cryptocurrency has advantages and disadvantages. For example, since bitcoin is not legal tender in France. Not being protected by the state, in case of hacking of the computer systems of cryptocurrency bases, no protection from the state will be given. Furthermore, since cryptocurrencies are mostly volatile and their value is changing, there is no way to ensure financial stability.

But cryptocurrency also has advantages as it has a certain speed of payments and little or no transaction costs.

However, some countries have already decided to legalize the payment of wages in crypto-assets. New Zealand is the first country in the world to legalize cryptocurrency wages in August 2019.

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