10 things employers need to know about French labor and employment laws

France is famous for its 35-hour workweek and national commitment to “working to live” as opposed to “living to work.” Thanks to strict French labor laws and collective bargaining agreements, French citizens enjoy some of the strongest protections in the world. And infringing upon these rights will bring you nothing but legal woes.

In this guide, we’ll explain how to remain compliant with French employment laws when you’re hiring new employees. We’ll also answer a number of frequently asked questions and give you the information you need to expand your business to France with confidence.

1. At-will employment doesn’t exist

The French labor code doesn’t recognize at-will employment. It’s extremely specific and strict about what constitutes just cause for terminating an employment relationship. In fact, French labor laws only permit dismissal as a last resort: Instead, they strongly encourage (read: require) employers to try other methods to resolve the problem before deciding that dismissing the employee is the only viable solution.

2. Misclassifying employees could result in serious consequences

The URSSAF, which is the governing authority on labor laws in France, takes misclassification of workers extremely seriously and imposes severe penalties on employers who skirt the law. 

A quick overview before we dive into penalties: An employee is a permanent member of the company they work for. They receive a fixed monthly salary that isn’t based on whether or not they complete a certain number of tasks by a specific deadline. Independent contractors, on the other hand, are hired to perform specific assignments and do not have to be given work if you don’t have anything for them to do. Unlike employees, they aren’t on the payroll and aren’t entitled to benefits.

If you conflate these worker categories, you’ll be subject to misclassification penalties. These include fines, which can be as high as 250,000 EUR, court-mandated payment of back taxes and retroactive salary and benefits, up to three years of jail time, and even a 10-year ban on hiring independent contractors. 

3. France has strong anti-discrimination protections

Among the rights fiercely guarded by French employment law is the right to equality. Regardless of whether they are on a fixed-term contract, performing part-time work, or working for you full time, all employees are protected from discrimination both in the workplace and during the hiring process. The French labor code is quite extensive when it comes to the characteristics it covers in its equality clause, more so than many other nations. According to French law, you are legally prohibited from discriminating against employees due to their:

• Race
• Age
• Sexual orientation
• Religious beliefs
• Gender identity
• Family situation (including pregnancy)
• Morals
• Political views
• Trade union membership
• Last name
• Physical appearance
• Ability to speak a language other than French
• Place of residence
• Perceived vulnerability due to economic reasons
• Belonging (or not belonging) to a certain ethnic group
• Genetic characteristics

Despite its length, this list isn’t exhaustive. Non-compliance with French anti-discrimination laws is both a civil and a criminal offense. The worker at your company who is accused of discrimination may face a fine of 45,000 EUR (for which they are personally responsible), and your business could be fined up to 225,000 EUR. The offending employee could even be jailed for up to three years.

4. You’ll have to treat with the works council on issues like dismissal

In France, the works council—also called the comite social et economique, the CSE, or the Business and Social Council—ensures employees have a direct line to management at the company they’re working for. You must consult with and get authorization from the works council before you make strategic decisions that will affect your organization, such as mergers, prior to dismissing redundant employees, when you’re drawing up your company’s training policy and benefits package, and so on.

5. The issue of trade unions in France is complex

To put it mildly, the trade union situation in France is complicated. While French employees are permitted to unionize, oddly enough, just under 9% of all workers in France are members of trade unions. This is much lower than in other European Union member nations.

France’s trade union situation is unique in another way, as well: There are eight trade union confederations, which is more than the number in any other Western industrialized nation. The reach of each of these confederations isn’t limited to just one sector either. A single French trade union will have chapters in multiple industries.

Just because their membership is low doesn’t mean you should count them out, however. It’s important to be aware that in France, every five years, employees participate in workplace elections that determine which trade unions will negotiate employment issues on the national and local levels. In other words, they’ll govern some characteristics of labor laws in France whether your employees are members or not.

6. If you fail to offer benefits, you’ll be hit with fines, penalties, and legal consequences

All French employees are entitled to statutory benefits such as pension, overtime pay, vacation entitlements, paid sick leave, maternity leave, parental leave, and national holidays. Failing to offer a package that contains the minimum benefits required could result in legal consequences.

Remember: French employees are protected not just by the nation’s labor code, but also by collective bargaining agreements, which cover 95% of the French workforce. Statutory benefits are mandated both at the national level and in more detail by CBAs. Because of this double layer of protection, consequences for violating benefits rules are harsh.

7. If you’re having issues with an employee, everything must be documented in writing

Don’t wait until termination is your only option for dealing with a problematic employee to start documenting the situation. French labor laws require you to interview the team member before you dismiss them, and you’ll need evidence to prove you have just cause for termination, both during the interview and if you wind up in court. So, the moment there’s an issue with an employee—even if it’s initially not their fault—start documenting everything in writing. Written evidence could be the only thing protecting you from having to pay compensation for wrongful dismissal later.

8. The vast majority of French employees are protected by collective bargaining agreements—even if they don’t belong to a trade union

Collective bargaining agreements are one of the most important aspects of the French labor code. They take place at the national, industry, and company levels and are agreements reached between an employer and trade unions (or between the employers’ association and the labor unions for that industry, if an industry-wide collective bargaining agreement is being negotiated). Even if they’re not a member of the trade union that decides the terms of the agreement, the vast majority of French employees (over 95%) are still safeguarded by these agreements.

Collective bargaining agreements are negotiated for myriad issues, ranging from working conditions to employee benefits to overtime rates and the minimum wage. If there’s a clash between, say, the applicable national and company-specific collective bargaining agreements, the one with the terms that are more favorable to the employee takes precedence over the other.

9. You need to safeguard employees’ personal information

Since France is a member of the European Union, its employees are protected by the General Data Protection Regulation (GDPR), which sets the world’s strictest policies for the protection and storage of employee data. Under the GDPR, you are required to implement the most advanced security measures possible, maintain accurate and updated records, and inform employees about what data is being collected and what it’s being used for, among other mandates.

10. The formal employment offer letter should include both company policies and the terms of the collective bargaining agreement

The formal employment offer letter—also called an employment agreement or fixed-term portage employment contract— covers a lot of important information. In particular, it needs to detail your company’s policies on things like termination, remuneration, working hours, and benefits, as well as the terms of the applicable collective bargaining agreement. It should be sent to the new team member after the hiring process is over but before onboarding begins.

For more information on how to send an offer letter to an employee in France, check out our guide.

Frequently asked questions about French labor laws

What is the minimum wage in France?

As of May 1, 2023, the hourly minimum wage in France is €11.52, which works out to €1,747.20 each month for employees working the 35 weekly hours that are standard under French law.

The minimum wage in France changes every January, so make sure you keep an eye out for the new rates at the start of each year to adjust your employees’ pay accordingly.

What are the overtime laws in France?

As mentioned above, the standard working week in France is 35 hours. Employees can work more than 35 hours each week, provided their employer agrees to compensate them accordingly. Under French labor laws, the overtime rate for the first eight additional hours the employee works is 125% of their hourly wage. The overtime rate increases to 150% of their hourly wage for any extra hours beyond this.

In lieu of overtime pay, some employers choose to compensate employees with additional time off.

Whichever compensation arrangement you choose, before you have your employees work overtime, make sure the applicable collective bargaining agreement permits team members to work more than 35 hours each week. If it doesn’t, you’ll have to negotiate a company-wide arrangement about overtime before you can require employees to work extra.

If that sounds tricky to monitor, Rippling EOR will automatically track hours and give your French employees the correct overtime rate—no matter their province or territory.

What are the required benefits in France?

Under French employment law, all workers classified as employees are entitled to the following statutory benefits:

• Pensions
• Overtime pay
• Vacation entitlements
• Paid sick leave
• Maternity leave
• Paternity leave
• Adoption leave
• National holidays (there are 11 in France)
• Healthcare benefits

All workers in France who are classified as employees are covered by the universal health insurance plan (the couverture maladie universelle complémentaire, or CMU-C), also known as statutory health insurance, or SHI. Both employees and employers contribute to the CMU-C through payroll taxes. Employers have the option of offering supplementary private healthcare coverage–called a mutelle–if they choose.

For more information on mandatory benefits in France, read our complete guide.

How do I terminate employees in France?

You’re probably not thinking about dismissing your French employees at the moment (after all, you just hired them), but it’s crucial to be aware of France’s termination laws before you start onboarding new team members. Even the smallest violation of the French labor code could put you in legal hot water.

As we mentioned earlier in this guide, France doesn’t recognize at-will employment. In fact, there are only three categories of justifiable reasons for terminating an employment relationship:

Voluntary personal grounds: This category is directly related to an employee’s behavior in the workplace and refers to misconduct issues. These include everything from repeatedly calling out of work to serious misconduct such as threatening other employees or stealing from the company.

Involuntary personal grounds: If an employee lacks the competence to perform their job duties, has repeatedly failed to achieve goals despite additional training or supervision, is experiencing a conflict with another team member that cannot be resolved via mediation, or is experiencing a similar issue, you may have involuntary personal grounds to dismiss them from your employ.

Economic grounds: If your company is having financial difficulty and a number of employees are made redundant due to economic reasons, you can get authorization from the local works council to terminate your relationship with these team members. By “economic grounds,” the French labor code is referring to financial issues that might cause redundancy, such as a company filing for bankruptcy or undergoing a top-to-bottom reorganization to remain competitive.

The Macron Scale, introduced in 2017, dictates the minimum and maximum amount of compensation employees can receive if they have been unfairly dismissed. While there’s now a cap on how much employees will receive in a wrongful termination suit—which is good news for employers—you should still be aware that if you dismiss a team member without just cause, they're well within their rights to involve the court and ask for financial compensation.

To learn more about terminating employees in France, consult our guide.

Hire and onboard French employees with Rippling

If you're hiring employees, independent contractors, or remote workers in France, you need Rippling.

Rippling allows you to manage HR, IT, and Finance in one unified system. We make it easy to onboard, manage, and pay employees and contractors around the world—in a single system that helps keep you compliant with local employment laws and regulations.

Rippling and its affiliates do not provide tax, accounting or legal advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any related activities or transactions.