France boasts a staggering number of skilled individuals across various industries, including sales, marketing, technology, and remote work. By utilizing the services of an Employer of Record (EOR) in France, employers from abroad gain unparalleled access to this exceptional talent pool.

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The EOR serves as the employer of record for these professionals, managing payroll, benefits, taxes, and other administrative tasks. This arrangement eliminates the need for employers to establish a legal entity in France, simplifying their operations and saving valuable time and resources.

French employment laws are known for their intricacy, including strict regulations surrounding hiring, contracts, and termination procedures. For example, the French labor law heavily emphasizes employee protection and social rights. Open-ended employment contracts are the norm, and fixed-term contracts are subject to strict regulations. In contrast, employer friendly countries like the USA are generally at-will, meaning employers or employees can terminate the employment relationship at any time, with or without cause (except in certain specific circumstances).  

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Especially when considering the influence of collective bargaining agreements (CBAs), employers gain a valuable ally by engaging an EOR in France. CBAs are legally binding agreements negotiated between employers and labor unions or employee representatives, ensuring fair and favorable terms for workers.  An EOR in France possesses expert knowledge of collective bargaining agreements and ensures full compliance with them. This mitigates an employer's legal risk. 

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The cost of an EOR in France can be seen as an investment in employer protection in an employee friendly environment. It also helps maintain operational efficiency during market entry. . Employers of Record in France charge an all-inclusive fee, encompassing payroll processing, benefits administration and tax compliance. 

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EORs in France either offer fixed pricing or percentage-based pricing for their services. The fixed pricing model allows the EOR to charge a predetermined flat fee. Fixed pricing provides employers with transparency and predictability, allowing them to budget accurately and forecast their expenses. 

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A percentage-based pricing model involves charging a percentage of the employee's total compensation - 3% to 10% of the employee's salary. Employers with fluctuating staffing requirements or short-term projects often prefer this pricing structure. 

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Employers must engage with potential EORs in France to understand their pricing structures and negotiate terms that best suit their business needs.

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Key Metrics For Foreign Employers

France’s renowned business-friendly policies and well-developed infrastructure, enabling your company to thrive. France's skilled workforce and access to a diverse consumer market make it an attractive destination for growth. France houses prestigious institutions like INSEAD, a top-ranked business school, offering unparalleled opportunities for professional development.

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Source: The Global Talent Competitiveness Index 2023

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Through the Gloroots' Recrew platform, you can discover amazing talent in France and grow your team effectively.

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Ensuring proper worker classification is of paramount importance when conducting business in France. Incorrectly classifying employees can result in legal ramifications and financial consequences. To mitigate these risks, partnering with a reputable PEO/EOR in France is a prudent decision.

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By collaborating with a trusted PEO/EOR, you can navigate the intricate landscape of French labor laws, ensuring compliance and accurate worker classification. These experts handle the complexities of payroll processing, comprehensive benefits administration, and ensure that your workforce receives the appropriate legal protections and entitlements they deserve. This allows you to concentrate on your core business operations while entrusting employment-related obligations to experienced professionals in France.

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Employment Contract

When recruiting employees in France, it is essential to draft the employment contract in the French language, regardless of the prospective employee's linguistic proficiency. Furthermore, any information pertaining to compensation and salary should be stated in Euros, the official currency.

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French legislation distinguishes between two primary categories of job contracts: the CDI (Contrat à durée indéterminée), which mirrors the concept of an open-ended contract, and the CDT (Contrat à durée déterminée), which essentially denotes a fixed-term contract with a maximum duration of 18 months, extendable for an additional 18 months.

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At a minimum, an employment contract in France must encompass essential details encompassing salary, benefits, and terms of termination. During the negotiation phase of the employment agreement, companies may need to consider the influence of existing collective bargaining agreements, which are notably abundant in France, given the significant role played by trade unions within the country's work culture.

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In the wake of the implementation of the European Directive 2019/1152 of 20 June 2019, employers bear the obligation to apprise employees of supplementary provisions pertinent to their employment, such as the duration of the probationary period and entitlements to training, among other factors. Crucially, key terms of employment must be communicated to the employee in a written format no later than one week subsequent to the initiation of the employment relationship.

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This might sound overwhelming, but it doesn't have to be. Gloroots eliminates these barriers for you. With Gloroots' Employer of Record offering, hiring and managing employees globally is a piece of cake.

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Overtime:

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Minimum Wage:

In France, the National Minimum Wage stands at 1,747.20 EUR, corresponding to an hourly rate of 11.52 EUR.

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Leaves:

Employers in France are mandated to provide a minimum of five weeks (30 days) of annual leave to their employees, which effectively translates to approximately 2.5 days per month, accounting for Saturdays as well. However, it is important to note that additional rest days may be required by certain collective bargaining agreements, particularly for employees whose standard work week exceeds 35 hours.

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Accordingly, employees may be entitled to receive one to two extra days of paid leave per month, depending on the applicable agreements. Typically, any unused leave cannot be carried forward into the subsequent leave period, which spans from June 1st to May 31st.

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Maternity Leave and Paternity Leave

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Sick Pay:

The Social Security office in France provides sickness reimbursements to employees starting from the fourth day of absence due to illness. It is common for employers to offer additional compensation, which is typically outlined in collective or company agreements.

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Employees with a minimum of three months' service are entitled to receive continued payment equivalent to a proportion of their regular salary for a maximum period of 90 days.

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To facilitate the process, all employees are required to provide their employer with a medical certificate (known as "un avis d’arrêt de travail") within 48 hours of falling ill. This certificate enables the employer to issue a salary certificate to the Social Security office, allowing the employee to receive Social Security benefits for a duration of up to three years.

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Income tax 

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Other Taxes and Social Security contribution:

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Termination Process:

Different methods of ending an employment contract exist, including redundancy, resignation, and mutual agreement through "Rupture Conventionelle." Each method has specific procedures that employers must follow.

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Regardless of the job contract, employers must provide a certificate of employment, documentation for unemployment benefits, and a settlement document outlining payments owed to the employee.

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Mutual Termination Agreements are commonly used to dismiss employees, reducing legal risks. Notice periods and payment terms can be negotiated, with typical settlements ranging from three to nine months' salary.

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The Mutual Termination Agreement process takes around 45 days, with a 15-day period for the employee to reconsider. The agreement must be submitted to the French Labour department for validation.

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Notice Period:

In France, the notice periods for employee departures are as follows:

• Employees with less than six months or two years of service are required to provide one month's notice.
• Employees who have completed two years of service are required to provide two months' notice.
• Executives are required to provide three months' notice.

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Severance Pay:

The amount of severance pay in France is determined by the following:

• Provisions in the employment contract or collective bargaining agreement
• Employee's position or role
• Reason for termination
• Level of goodwill between the company and the employee

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Typically, severance pay is calculated based on a monthly figure, which is derived from the highest value among the monthly averages over the past year, the general average monthly earnings, or a third of the payment from the preceding three months.

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Probation Periods:

In France, the duration of probation periods varies depending on the employee's category and level of seniority. Blue-collar employees typically have a two-month probation period, technicians and supervisors have three months, and management positions require a four-month probation period.

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During the probation period, either the employee or the employer can terminate the employment contract without the need to provide reasons or compensation, unless otherwise stated in the agreement. The usual procedural rules for dismissal do not apply during this period.

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However, both the employer and, in certain cases, the employee are still required to provide notice. According to Articles L. 1221-19 to L. 1221-24 of the French Labour Code, the notice periods are as follows: 

• At least 24 hours for less than 8 days of presence
• 48 hours for an employment period between 8 days and 1 month
• 2 weeks after 1 month's presence
• 1 month after 3 months of presence

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When hiring globally, ensuring compliance comes with its own set of battles. Employers must ensure all hiring and onboarding activities adhere to employment laws, payroll procedures, DE&I compliance, GDPR and similar data protection, etc. If you think it is hard to set up local entities and start hiring, keeping up with a dynamic compliance landscape is far harder. 

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Gloroots helps you minimise all these efforts by providing a single window to manage all these tasks. Our in-house experts fully shield you from cross-border employment and payroll compliance risks. They do this by helping you with generating employment contracts, on-time payments, compliant benefits, while you focus only on screening talent. 

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Our promise is a stress-free global employment experience for both you and your employee.

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Contact our experts today to kickstart your global hiring campaign.

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To grow your team in France, partnering with Gloroots as your global Employer of Record (EoR) can alleviate the challenges associated with compliance, payroll, tax, and benefits management. France's intricate employment regulations require local expertise and resources to ensure adherence to the laws.

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Gloroots' comprehensive EoR service takes care of the administrative burden, letting you  focus on your employees and the expansion of your company. By entrusting Gloroots with payroll, tax obligations, benefits administration, and compliance, you can streamline your operations and confidently navigate the complexities of French labor regulations. This empowers you to grow your team in France with peace of mind, knowing that your HR needs are expertly handled, allowing your business to flourish.