How To Hire And Pay Employees In France
Emerald Technology's guide to hiring employees in France.
Euro is the official currency of France. Its currency symbol is €, EUR.
Estimated 45% of employee's salary
French is the official and national language of France and has over 79 million native speakers.
GROW YOUR TEAM IN FRANCE
NO ENTITY, NO PROBLEM
To start growing your team in France, you must establish a local entity- including an account with a local bank, a local office and an address registered as a subsidiary. This allows you to manage payroll, tax, benefits and compliance for your employees, but can take several months.
Emerald can hire and payroll your workers, quickly and compliantly with their ready to go entity. Make growing your team simple with Emerald as a global partner.
Pros and Cons of hiring in France
Its important to understand the pros and cons before deciding to whether to hire employees in France. Here we’ll have a look at both sides of the issue:
France has a reputation for having a well-educated workforce and being business friendly. It has many incentives and tax breaks designed to help new start-ups get off the ground, such as low corporate taxes and reduced payroll costs through employee benefits programs like leave days (six weeks per year) or even childcare allowances.
However, foreign nationals can only legally work in France if they have been granted a work permit. This process is often complicated, time-consuming and expensive for employers.
Many foreigners do not speak French well enough to get by on a daily basis, especially when communicating with customers or clients who aren’t proficient in English or another foreign language.
Why France is good for remote workers
There is a growth in the shift towards remote working, with more employees expressing their interest in remote working.
France is well known amongst the remote working community for its flexible work-life balance, therefore, makes it a popular destination for remote workers. It attracts those who want to experience the authentic French lifestyle.
Paris is popular amongst digital nomads and remote workers, although it is more expensive than other parts of the country, it benefits from speed of wifi, co-working spaces and it's remote community.
|Social Security - Sickness, Maternity, Invalidity & Death||7%|
|Supplementary - Incap. Inval. Death||0.37%|
|Work Accident/ Work-related illness||0.77%|
|Retirement - Capped Old Age||8.55%|
|Retirement - Uncapped Old Age||1.90%|
|Supplementary Tranche 1||6.01%|
|Additional supplementary contribution||8.00%|
French employers are required to offer the following benefits to all full-time employees:
- Life Insurance
- Public Transport
- Work Injury Insurance
- Medical Exams
- Termination Indemnities
Some employers like to other additional benefits to improve employee retention and satisfaction.
- Flexible hours and hybrid working
- Meal vouchers
Contracts of employment must be in French but can be translated to an employees native language.
Creating a strong contract with help pacify any compliance concerns. An employer must provide the following in a contract.
- Name (Employee and Employer)
- Address in France
- Country + city/town of birth
- French social security number
- Working hours if not standard full time hours in France
- Job title + description
- Holiday entitlement per year
- Place of work
- Salary + any commissions/ bonuses.
A probation period in France is typically between 1 - 4 months. The more senior the position the longer the probation period. Fixed term contracts with a duration over 6 months can include a probation period of 1 month.
French law stipulates that all residents of France must have health insurance. This can be through the public healthcare system or a private scheme.
The government generally covers over 70% of treatment costs which can go up to 100% in the case of long term treatment.
Employees and their families are fully eligible for France’s comprehensive social security system, which includes:
- Health, maternity, paternity, disability and death insurance.
- Workplace accident and illness insurance.
- Pension contributions.
- Family allowances.
- Unemployment benefits
Expectant mothers in France are entitled to 16 weeks of maternity leave (congé maternité). This is usually taken 6 weeks before the expected due date and 10 weeks after the birth. Mothers do not have to take the full 16 weeks but must take at least 8 weeks.
To be entitled to maternity leave payments the mother must have been making social security payments for at least 10 months, worked at least 150 hours in the last 3 months or 600 hours in the last 12 months if the work has been intermittent.
Maternity leave is usually calculated based on the last 3 salary payments. From July 2021 paternity leave was being increased to 28 calendar days.
As per the policy, employees have the right to avail 25 days of paid paternity leave. Out of these, four days must be taken immediately following the birth of the child. The remaining days can be taken in two separate blocks of at least five consecutive days each, before the child turns six months old.
The employer will pay the employee their average salary of the last three months before the leave, subject to a maximum of EUR 89 per day. During the leave, it is the employer's responsibility to make the payment. While the employee cannot extend their paternity leave, they may be eligible for parental leave if they have worked with the same employer for at least one year.
If an employee is unable to work due to illness, they are required to provide their employer with a sick note from a health professional such as a doctor.
Employees can then claim sick pay from the social security system after the fourth day sick. Employees will usually receive half of their salary based on the last three salary payments.
As the legal employer, Emerald Technology requires the following employee documents to ensure complete compliance:
- Valid Passport
- PDF copy of bank details with bank logo on inc. IBAN, BIC/SWIFT
- Copy of visa if no passport
Resignation and Dismissal
An employee may unilaterally terminate their employment by providing written notice to their employer.
France has strict rules and protocols around termination after probation. A significant file needs to be created to prove that the employer has made all possible efforts to prevent the dismissal. Termination procedures can be lengthy. Employers can dismiss an employee on either personal or economic. Different rules and procedures apply to the type of dismissal.
Personal reasons may apply to matters such as conduct, competence, incapacity and refusal to accept changes to a contract of employment. An employer must have genuine and substantive grounds cause to dismiss an employee with an indefinite-term employment contract for personal reasons. The specific reasons must be recognised by French Law or French case law.
Dismissal on the grounds of misconduct cannot take place unless the proper disciplinary procedure has been completed. Before an employer decides to dismiss an employee for personal reasons, it must summon the employee to a pre-dismissal interview. At the interview, the employer must explain its reasons for considering dismissal and ask the employee for explanations. The employer must then write to the employee within one month and no less than two days after confirming dismissal. The notice period will then begin.
Notice is not required for gross or serious misconduct. Any dismissal for economic reasons must be justified by a real and serious cause. The economic motive is defined by the Labour Code as a reason not relating to the employees person.
Dismissals for economic reasons are subject to the same procedure as they apply to dismissals for personal reasons, involving an interview, a dismissal letter to the employee. In the case of economic dismissals, the letter cannot be sent until at least seven working days after the interview (15 days in the case of managers and professional staff).
Employees on permanent contracts are entitled to a severance payment (indemnité de licenciement) if they are dismissed, if they have at least eight months service with the employer.
Statutory Time Off
Full-time employees in France are entitled to 2.5 days of annual leave for each month worked. This gives employees 5 weeks annual leave each year.
Annual leave is accrued from 1st June to 31st May to then be taken in the following period. This is pro-rated for part time employees and employees who have not worked the full previous 12 months.
There are 11 public holidays in France and 2 regional holidays.
- New Year's Day
- Easter Monday
- Labour Day
- Ascension Day
- Victory Day
- Whit Monday
- Good Friday
- St Stephen's Day
Work, Pay and Taxes
The minimum wage in France from January 2022 is €10.57 per hour. This is usually increased on an annual basis.
Working Time and Overtime
French labour law dictates that the standard working week in France is 35 hours (Temps de travail). However, this can vary depending on the industry and any collective bargaining agreements. Working days are typically Monday to Friday, depending on industry.
Overtime payments are usually fixed by collective agreement, but they have to be paid with at least 25% extra/hour. Some managerial staff classified as “autonome” work more than 35 hours a week, are given additional holiday days.
In 2017, France also implemented a “right to disconnect” mandate, which legally entitles employees to not respond to business correspondence after working hours.
Employees in France are generally paid on a monthly basis, towards the end of the month. Some companies operate a 13th salary which is usually paid at the end of the year or split between June and December.
Employers are not required to provide employees a bonus. This is down to the employers discretion.
The French income tax is calculated based on a progressive rate system, with a maximum rate of 45%. However, several other factors may affect the overall tax rate, including the individual's household status, income level, and the number of children they have.
|€0 - €10,225||0%|
|€10,226 - €26,070||11%|
|€26,071 - €74,545||30%|
|€74,545 - €160,336||41%|
WORKER MISCLASSIFICATION IN FRANCE
Similar to other countries, France has strict rules on classifying individual contractors and full-time employees differently. Misclassifying your workers can put your business at risk of fines.