The idea of paying employees in a cryptocurrency, although attractive in some respects, raises numerous legal and practical questions that must be carefully considered. Without delving into overly technical debates, here are some key points to consider:

  1. Regulation of Salary Payments: According to the Employment Code, salaries must be paid in cash, by crossed cheque or by bank transfer to an account held by the employee. Therefore, paying a salary, even in the form of a bonus, in cryptocurrency is not in compliance with current legislation.
  2. Benefits-in-Kind: Since cryptocurrencies are classified as crypto-assets, some have raised the possibility of classifying them as benefits-in-kind. However, according to the Official Social Security Bulletin, a benefit-in kind consists of providing or making available a good or service, allowing the employee to save on costs they would normally have to bear. In light of this definition, equating cryptocurrencies with a benefit-in-kind seems somewhat risky.
  3. Volatility Issues: The value of cryptocurrencies fluctuates greatly, which poses challenges both for calculating the social security contributions and managing tax implications. Both the employer and the employee could end up paying contributions on an amount that might be devalued a few days later.
  4. Consequences: In addition to the risk of criminal fines related to non-compliance with the payment regulations in the Employment Code, an employment court decision reminds us of an old legal adage: “Who pays badly, pays twice.” In a decision dated 12th January 2021, a labour court ordered an employer to pay the employee’s December and January salaries in euros, after they had been paid in bitcoins. The employee was asked to return the bitcoins to the employer upon receiving the payment, which he did not do (at least not initially).
  5. Practical Advice: Given these points, it is strongly recommended that employers avoid using cryptocurrencies as a means of paying salaries or bonuses. The current situation creates a legal framework that is not favourable and could lead to disputes and financial losses for the employer. Overall, while cryptocurrencies represent an attractive innovation in the financial world, their use as a means of remuneration presents legal and practical challenges that cannot be ignored. Companies wishing to explore this option should first seek legal advice to assess the implications of such an initiative.