ABSTRACT
This chapter examines the incidence of different types of performance related pay in France by gender and skill. It outlines institutional and legal context together with a short description of the profit sharing plans currently in existence. The chapter focuses on profit sharing, its features in the French context, and empirical evidence regarding its effects on productivity and employment. The chapter explores theoretical hypotheses about the effects of profit sharing and review the empirical evidence. It presents new estimations of the effects of profit sharing on establishment productivity using the French industrial relations survey. France has a national minimum wage, and national industry-level wage bargaining that sets wage scales and certain bonuses for the employees covered. The dominant form of performance related pay in France is profit sharing. Profit sharing has always been regarded in France as a means of redistribution and as encouragement for employees to save.
