Undeclared work is an offense that exposes you to severe penalties, especially for the employer.
According to a 2019 report by the Guidance Council for Employment, around 2.5 million people practice 100% or part of undeclared work. This “concealed work” would cost nearly 6 billion euros to Social Security each year. All sectors of activity are not equal and certain branches of trades frequently use undeclared work. Among the sectors that defraud the most, the hotel and catering industry, the construction industry, agriculture and also personal services are on the front line. However, this practice is not without risk for employees on the one hand and employers on the other.
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An employee voluntarily in illegality cannot be prosecuted. But beware, the game is not worth the candle. If the undeclared work is discovered, the state will order you to reimburse any allowances and social benefits received during this period. Concretely, if you work on the black market while being registered as unemployed at the same time, you risk seeing your unemployment benefits suspended and a removal from Pôle Emploi. You will also have to reimburse the sums paid by the State during this period. In addition to these sanctions, there is the risk of seeing social organizations (Pôle Emploi, CAF, etc.) request financial penalties in addition to the sums to be reimbursed.
But that’s not all. Remember that by working illegally, you no longer open up any rights in terms of retirement, disability or unemployment. In the event of an accident at your workplace, the financial consequences can be disastrous.
For a company, the scale of penalties provided is much greater. If the labor inspectorate discovers undeclared employees on a construction site or in a restaurant, for example, the employer risks up to 3 years in prison, a fine of 45,000 euros and a ban on running a business (5 years imprisonment and a fine of 75,000 euros when the employer conceals the work of several people or employs a person recognized as vulnerable by the courts on the black market). In addition to criminal penalties, administrative closure (3 months maximum) and restitution of all aid paid by the State in terms of employment or professional training (amounts granted under the apprenticeship contract, the professionalisation, etc.) are part of the risks incurred by the employer.
In addition to businesses, many individuals give in to the temptation of concealed work for DIY work, a little cleaning or tutoring hours for their children. The law provides for the same penalties for individual employers as for companies. An individual who is guilty of undeclared work faces up to three years in prison and a fine of 45,000 euros. Very often, individuals underestimate the risks and are surprised to see their employee turn against them when the employment relationship ends. The amount of compensation can amount to thousands, or even tens of thousands of euros in the event of a dispute.
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