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9 June, 2014 - 11:17 By News Desk

New employment laws in France – Vive la difference

Roger-James

The simple advice often given to employers looking to hire in France is don’t do it! Of all the countries in which we help our clients with their employment law affairs, France is certainly one of the most problematic for employers.

In the first few months of 2014 there have been some reforms to French law, in part in response to the economic crisis and Frances’ sluggish recovery. We set out some of the key changes below.

Lay offs

A new law aimed at providing greater flexibility to employers and balancing that against job security for employees has been brought in which:-

• Allows employers facing financial difficulty to increase working time, modify the structure of their organisation and decrease employees’ salary for up to two years if a collective agreement (agreement with a union) is signed

• In return employees are protected against dismissal for economic reasons for the duration of the agreement

• New rules on collective redundancies shorten the information-consultation process where an employer is terminating the contracts of 10 or more employees due to economic reasons.

Fighting employment insecurity

Not such good news for employers is the French Government’s use of the taxation system to deter the use of fixed term contracts by taxing employers more than the rates applicable to permanent contracts.

The new rates will not apply when recruiting a fixed-term employee to replace an employee who is temporarily absent from the company.

This is likely to mean that employers may reduce short term contracts of employment and will use indefinite term contracts of employment with renewable probationary periods instead.

Information to supply to works council

A change that will concern many employers, is a new requirement for employers to create an online database, accessible by members of the works council only, which contains employment information, much of which may be considered by the employer to be sensitive. The information to be provided includes:-

• Employee, manager and director salary details

• Asset and investment information

• Forecasts for the next three years and

• Strategy information for the past two years.

Employers with 300 or more staff in France must comply by 14 June 2014.  Employers with 50 to 299 staff have an extra year to get the database set up.

These new laws are not going to change Frances’ reputation as a place not to employ people. However, with good advice and a bit of patience challenges can be overcome.

Whatever country you are based in, if you want advice on employing people in France, or indeed elsewhere in the world, please contact Roger James or one of the other members of the Taylor Vinters team on +44 1223 225286, or email roger.james [at] taylorvinters.com

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