France

There is no one standard type of contract in France. However, there are four types of employment contracts based around the nature and term of employment a company seeks to hire an employee. These include:

1. Permanent Contract  (Contract Duration Indeterminée (CDI))

CDI contracts are the most common type of employment contract that exists in France. If this form of contact is agreed upon between employer and employee, the terms of employment will be indefinite with no end date and subject to any mandated labor Laws, and CBA’s where applicable. Full-time CDI contracts can be verbal agreements, written in French or English. Part-time contracts always must be in writing.

2. Fixed Term Contact (Contract Duration Determinée” (CDD))

As the name suggests, these are considered fixed or temporary term contracts and are only able to be enacted in exceptional circumstances (for general information about these contracts check out our guide, ‘Indefinite Contract vs Fixed Term‘).  They are organized by an employer to fulfil a specific task with a determined end date, or for other reasons authorized by employment law in France. Some reasons include seasonal workers, temporary growth of the company, or replacement of an absent employee. CDD contracts must be written in French and signed by the employer and employee.

3. Apprenticeship or Professionalization Contract

Employment contracts of this type must be in written form stipulating terms of training and terms of employment activity. These types of contracts have the objective for an employee to obtain a professional certification.

4. Single integration contract

Single integration contracts are for employers to receive financial aid and facilitate employment to individuals who have difficulty in finding employment allowing them to have temporary professional integration, and provide further opportunities in the future.

It is highly recommended to issue a contract of employment in French language.

The key sources of employment rights and obligations in France are:

• statutory provisions of the French labour code;
• provisions of the mandatory industry-level collective bargaining agreement;
• employment contract; and
• any company policy implemented unilaterally by the employer in compliance with French regulations.

Trial Period

The maximum length of a probationary period is 8 months. Collective bargaining agreements also play a role here.

Working hours & overtime

Standard working hours within French Law are 35 hours a week at all companies, and the working day may not exceed 10 hours.

Overtime

All work above the standard 35 hours a week is to be paid as overtime and is regulated by collective agreements and acontracts, generally calculated as follows:

• Additional 25.00% an hour for each of the first eight hours of overtime (from the 36th to the 43rd hour, inclusive)
• Additional 50.00% for each hour after that

Minimum Wage

The minimum hourly wage stipulated by law for 2019 is €1,522 per month, or €10.03 per hour. A higher minimum is often set by collective bargaining agreements, which are enforceable by law.

Payroll cycle

The payroll cycle in France is generally a monthly cycle, with wages paid by the last working day of each month.

The 13th Salary in France is customary and generally paid at the end of the year.

Taxes: Employer tax, employee tax

Employer’s Contribution

Employers of French employees are required to pay health tax, autonomy solidarity contributions, old age insurance, family benefits, unemployment insurance, occupational health service tax, and a working from home allowance. 

• 8.55% (ceiling of €3,311) – Social Security
• 5.25% or 2.45% – Family Benefits
• 4.05% (ceiling of €13,244) – Unemployment
• 0.30% – Autonomy Solidarity Contribution
• 0.15% – AGS (Wage Guarantee Insurance)
• 7 – 13.00% – Health, Maternity, Disability, Death

The employer cost is generally estimated at between 42% to 48% of the employee salary.

Employee’s Contribution

Employees in France are taxed between 0% and 13.6% depending on their income bracket. Old age insurance and social security are taxed on top of this.

• 9.20% – Social Security Surcharge
• 6.90% (ceiling of €3,311) – Old Age Insurance

Employee Income Tax

• 0% – Up to 10,084
• 11.00% – 10,085 – 25,710
• 30.00% – 25,711 – 73,516
• 41.00% – 73,517 – 158,122
• 45.00% – over 158,123

Types of leave

Statutory leave

All full-time workers are legally entitled to 25 days paid holiday leave a year. In addition, full-time workers have 11 paid public holidays a year. The minimum amount of annual leave is 5 weeks.

Pregnancy and maternity leave

The length of maternity leave for employees depends on the number of children of the mother:

• Single birth bringing mother’s number of children to one or two – 16 weeks, broken down into 6 weeks before childbirth and 10 weeks after
• Single birth bringing mother’s number of children to three or more – 26 weeks, broken down into 8 weeks before childbirth and 18 weeks after
• Multiple birth of twins – 34 weeks, broken down into 12 weeks before childbirth and 22 weeks after
• Multiple birth of triplets or more – 46 weeks, broken down into 24 weeks before childbirth and 22 weeks after

Additional maternity leave can be granted through the relevant collective bargaining agreement. Employees can also choose to increase or decrease the proportion of maternity leave before and after childbirth with a physician’s authorisation.

Paternity leave

Male employees are granted three days of leave when the childbirth happens and are entitled up to 25 days (4 compulsory, 21 optional) for single births and up to 32 days (4 compulsory, 28 optional) for multiple births. Paternity leave has to be taken within the first four months after the birth or adoption.

Other leave

• Adoption leave: before adoption of a child, employees are entitled to 6 weeks of unpaid leave if traveling abroad to adopt a child. Length of leave after adoption depends on the number of adoptions and whether the leave is shared between parents. When taken by one parent and up to two children, the duration is 10 weeks. For three or more children, the duration is 18 weeks. For multiple adoptions, adoption of twins, triplets or more, the duration is increased to 22 weeks. If shared by both parents, adoption leave is increased by 11 days (or 18 days in case of multiple adoptions).

Notice period

The statutory notice period for an employer depends on the duration of employment. For employment duration between 6 months and 2 years, the notice period is 1 month. For employment duration over 2 years, it is 2 months. For executives, the notice period is 3 months.

Termination of employment

French employers in general have the following ways to terminate the employment relationship:

• Termination by mutual consent through a settlement agreement;
• Dismissal for economic reasons, for example 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.

Under French labour law, the qualification of an employment contract is based on the factual circumstances/evidence, regardless of the contents of any work agreement that has been signed. 

These factual circumstances include, for instance, the fact that the individual:

• performs specific, technical duties, typically corresponding to a job description; 
• must report to a manager or supervisor who has the power to give him/her instructions, assess the work done, and/or monitor the agenda (e.g. hours, leaves);
• devotes all (or almost all) his/her working time to the company and/or has no (or very few) other clients;
• the company provides them with all the tools and equipment to perform his/her work (e.g. office furniture, etc.); and
• receives a fixed monthly remuneration for his/her services (as opposed to a fixed price for each assignment, without any guarantee of earnings over time).

Potential sanctions in the event that a French labor Court rules that the individual must be reclassified as an employee may be significant. The consequences for the employer are as follows:

• For the past 3 years (statute of limitations under French law), the labor Court could sentence the employer:
• To pay the individual salaries up to the amount which would have been due to him/her pursuant to French minimum wage and overtime regulations (labour law and CBA provisions), in addition to penalties for not complying with these rules;
• To pay to the French social security contributions agency all applicable social security contributions on top of these sums.
  

For the future:

If the company terminates the contract: the labour Court could sentence the employer to pay to the individual:

• • damages for unfair dismissal, the amount of which would depend on his/her length of service within the company (the amount varies from 1 to 20 months of the individual’s average monthly earnings, depending on his/her length of service);
  • damages for undeclared work (“travail dissimulé”), i.e a lump sum amounting 6 months’ of the employee’s salary

If the employer takes over the contract under an employee status: the employer would then have to fully comply with French employment law. This could result in an increase in the employee’s remuneration in comparison with his/her contractor status, and social security contributions being due on top of the amounts paid to the employee.

In addition, the company would face a risk of penalties from the French social security and tax authorities.