Hiring Talent And Managing Payroll In France

Hiring in france? Read on to find out the employment norms (like taxes, payroll and benefits) and EOR (Employer on Record) norms in France

Employment Norms in France

France has a complex set of employment norms that are designed to protect the rights of both employers and employees. These norms cover a wide range of topics, including employment contracts, working hours, leave, and termination procedures. Understanding these norms is essential for anyone looking to work in France or manage a French workforce.

General Information:

France's currency is Euro (EUR).
Paris is the capital of France.
French is the official language of France. Legal documents should be drafted in French.
As of 2022, France's GDP was reported to be USD 3.13 trillion.

Labor laws in France include a 35-hour workweek, minimum wage requirements, and strong protections for workers' rights.

Table of Contents

Select Section

Agreements
Onboarding Process
Visa
Minimum Wage
Payroll Cycle
Annual Bonus
Health Benefits
Working Hours and Overtime
Leaves
Social Security
Taxes for Employers
Taxes for Employees
Probation
Termination
Severance Pay
Employees or Contractors
Final Words

Agreements Onboarding Process Visa Minimum Wage Payroll Cycle Annual Bonus Health Benefits Working Hours and Overtime Leaves Social Security Taxes for Employers Taxes for Employees Probation Termination Severance Pay Employees or Contractors Final Words

Agreements

In France, there are several types of labor and employment-related agreements that govern the relationship between employers and employees. French is the default language for employment contracts. France has two employment contract types: CDI(contrat à durée indéterminée) for permanent employment and CDD (contrat à durée déterminée) for temporary employment, with CDI being for continuing and indefinite service and CDD being for temporary employment not exceeding 18 months. Some of the key agreements include:

A written employment contract is required for all employees with mandatory provisions.
Collective bargaining agreements are negotiated between employers and trade unions, covering wages and working conditions.
Works council agreements are required for companies with 50+ employees and it has the right to be informed and consulted on employment-related matters.
Social security agreements with several countries allow workers to transfer benefits when moving.
Non-compete agreements must be limited in time and geographic scope to be considered valid under French law.

Onboarding Process

The onboarding process in France typically includes the following steps:

Introduction: New employees are introduced to the company and its culture, and given a workplace tour.
Training: Depending on the job, new employees may receive training on products, processes, and safety.
Administrative tasks: New employees complete tasks like signing contracts and filling out tax and social security forms.
Follow-up: Regular meetings ensure the employee is adjusting well and has the resources to perform their job.

Visa

France has several types of visas that allow foreign nationals to work in the country, including:

Long-stay work visa: This visa is intended for individuals who have secured a job in France and need to stay in the country for an extended period.
Temporary work visa: This visa allows individuals to work in France for a limited period, typically up to 90 days.
Highly Skilled Worker visa: This visa is intended for individuals who have specific skills or expertise that are in high demand in France.
EU Blue Card: This is a special work and residence permit for highly qualified individuals from outside the European Union.

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Minimum Wage

The legally mandated minimum monthly wage in France is EUR 1,709.28 or EUR 11.27 per hour. However, many collective bargaining agreements enforce a higher minimum wage that employers are obligated to adhere to.

Payroll Cycle

The payroll cycle in France is monthly.

Annual Bonus

While the 13th month's pay is not obligatory in France, it can be voluntarily provided by the employer if both parties agree. In such cases, the payment is usually made at the end of the year.

Health Benefits

In France, employee health benefits are largely provided through the national social security system, which is funded by contributions from both employers and employees. The system covers a wide range of medical expenses, including doctor's visits, hospitalization, and prescription medications.

Working Hours and Overtime

Work hours:In France, employees work 35 hours per week with a daily limit of 7 hours over 5 working days. starting from Monday to Friday.
Break: Employees are entitled to a 20-minute rest break if they work more than six hours, 11 consecutive hours of rest daily, and a minimum weekly rest period of 35 consecutive hours.
Overtime: Employees who work for more than 35 hours a week are considered to be working overtime. The employer needs to pay the employee for the overtime they have worked, which is a 25% surcharge for extra 8 hours in a week and a 50% surcharge if the overtime is more than 8 hours in a week. Overtime needs to be paid mandatorily to part-time employees. Those employees who are working on a contract do not get paid for overtime.

Leaves

Sick Leave

Employees in France who have worked for 150 hours for the first three calendar months, can avail of unlimited paid sick leave. The initial three days of leaves are unpaid and counted as a qualifying period. After three days are completed the leave is paid from social security.

Maternity leaves

In France, female employees are entitled to 16 weeks of paid maternity leave. The employee should take a leave of six weeks before the birth of the child.

Paternity leaves

Employees can take paternity leave of 25 days. Out of 25 four leaves should be taken after the birth of the child.

Parental leaves

Employees can take parental leave of one year. The leave can be extended till the child is of three years.

Annual leaves

All employees in France are entitled to a minimum of 35 days of paid annual leave.

Public Holidays (for the Calendar year 2024)

These dates may change as per official government announcements.

New Year's Day - 1st January
Easter Monday - 1st April
Labor Day - 1st May
Armistice World War II - 8th May
Ascension Day - 9th May
Whit Monday - 20th May
Bastille Day - 14th July
Assumption of Mary - 15th August
All Saints' Day - 1st November
Armistice World War I - 11th November
Christmas Day - 25th December

Public Holidays (for the Calendar year 2025)

These dates may change as per official government announcements.

New Year's Day - 1st January
Easter Monday - 21st April
Labor Day - 1st May
Armistice World War II - 8th May
Ascension Day - 30th May
Whit Monday - 2nd June
Bastille Day - 14th July
Assumption of Mary - 15th August
All Saints' Day - 1st November
Armistice World War I - 11th November
Christmas Day - 25th December

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Taxes for Employers

The taxes paid by employer and employer contributions in France are as follows:

Health, Maternity, Disability, and Death: Employers are required to contribute 13% towards the social security system that covers health insurance, maternity and paternity leave, disability, and death insurance.
Old Age Insurance: Employers have to contribute 8.55% towards the social security system that covers pension and retirement benefits.
Family Benefits: Employers must contribute either 5.25% or 2.45% of an employee's salary towards the social security system that covers family allowances, depending on the size of the company.
Unemployment: Employers must contribute 4.05% towards unemployment benefits.
Autonomy Solidarity Contribution: Employers must contribute 0.30% towards the social security system that covers long-term care for the elderly and disabled.
AGS (Wage Guarantee Insurance: Employers must contribute 0.15% towards the wage guarantee fund that provides compensation to employees in case of bankruptcy or insolvency of the company.

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Taxes for Employees

The employee tax rates in this scenario are broken down as follows:

Social Security Surcharge: Employees have to pay a tax of 9.20% on their gross salary to fund social security benefits like retirement, disability, and survivor benefits.
Old Age Insurance: 6.90% is contributed by employees on their retirement benefits.
The employee tax rates include 0% tax on the first EUR 10,084 of income, 11.00% tax on income between EUR 10,085 and EUR 25,710, 30.00% tax on income between EUR 25,711 and EUR 73,516, 41.00% tax on income between EUR 73,517 and EUR 158,122, and 45.00% tax on any income over EUR 158,123.

Probation

The probationary period for employees typically ranges from 1 to 3 months but can vary depending on collective bargaining agreements. The maximum duration of probation would be around 8 months.

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Termination

Termination Process:

Termination by mutual consent through a settlement agreement
Dismissal for economic reasons, such as structural, economic and technological changes
Employee resignation with written notice and notice period as per employment contract
Urgent dismissal of the employee, for example in case of theft or any other serious misconduct

The notice period for an employer is one month for employment duration between 6 months and 2 years, two months for employment duration over 2 years, and 3 months for executives.

Severance Pay

The amount of severance pay an individual receives is based on their length of service to the employer.

For less than 10 years of service, the statutory severance pay is 25% of the monthly salary for each service year.
For more than 10 years of service, the statutory severance pay is 33.33% of the monthly salary for each service year.

Employees or Contractors

In France, employees and contractors have distinct legal definitions. An employee is hired under a contract and receives a salary, while a contractor works independently and is paid on a contract basis.
Misclassifying either can lead to legal and financial consequences, such as penalties for not contributing to social security or entitlement to employee benefits.

Final Words

Employment norms in France are designed to protect workers' rights and ensure fair treatment by employers. These norms include minimum wage requirements, maximum working hours, paid leave, and social security contributions. Employers must adhere to these norms, as well as regulations related to termination, notice periods, and severance pay. Understanding and compliance with these regulations are essential for both employers and employees in France.