What you should know about employing people in...France
In France, the general rule is that employees are hired for an indefinite period.
1. HiringAn employment contract may be signed for a fixed term with an employee in a very strict number of circumstances defined by French law:
for the performance of a very specific and temporary assignment, in a number of specific cases defined by French law;when the contract is entered into in the context of a government program to promote employment or continued professional training.
Fixed term contracts which do not fulfil the above conditions are deemed to have been concluded for an indefinite period and may give rise to criminal sanctions (a maximum fine of 3,750 € and/or a maximum jail sentence of 6 months).
2. Pre-hiring declarationEmployers must file a pre-hiring declaration for each new hire with the French authorities (URSSAF) at least 8 days prior to the start of employment.
Failure to make this pre-hiring declaration may subject an employer to criminal sanctions (a maximum fine of 7,500 €).
3. Applicable employment lawsEmployment relationships in France are subject to the French Employment Code, applicable national and local bargaining agreements (“conventions collectives”) and the provisions of individual employment contracts.
An employment contract does not need to be in writing. A mere offer letter is sufficient to constitute an employment contract.
Since an employment contract can include a series of provisions specifically designed to protect the employer (probationary period, exclusivity, non-competition, confidentiality, classification, work organisation, inventions, etc…), we highly advise employers to seek legal advice for the drafting of employment contracts.
4. Employee classificationEmployees are usually classified in France as either executives (“cadres”) or non-executive (“non cadres”), who may be further classified as a regular employee (“employé”) or a labourer (“ouvrier” or “agent de maitrise”).
The details of an employee’s classification and corresponding minimum wages are found in the applicable collective bargaining agreement.
5. Probationary periodTo be enforceable, a probationary period must be included in a written employment contract. The maximum period for an initial probationary period, and in some cases for renewals of the probationary period, is generally found in the applicable collective bargaining agreement.
The length of the probationary period will depend on the employee’s classification, level and position.
6. Wage lawsFrench law provides for a minimum wage (“SMIC”) for all employees over 18 years of age, of normal physical capacity, regardless of gender, working in the French territory.
French law also ensures salary equality between male and female employees for the same job. Discrimination may be criminally sanctioned by a maximum fine of 3,750 € and/or a maximum jail sentence of 1 year.
7. Work hour lawsAs a general rule, employees must be hired to work for 35 hours per week. However, several major exceptions have been implemented following the enactment of the 35 hours workweek laws.
Overtime is allowed in France, but is strictly regulated. For instance, an employee cannot work more than 10 hours per day or more than 44 hours per week during any period of 12 consecutive weeks.
Overtime hours are compensated more than regular working hours.
8. Non-competition clauseNon-competition clauses are enforceable under French law during the term of the employment contract as well as for a period after the termination of an employment contract (the maximum duration of this is generally set forth in the applicable collective bargaining agreement)
A non-competition provision is enforceable when (1) it aims to protect the company’s interest, (2) it is limited in time and geographical area and (3) it provides for a non-competition indemnity.
The minimum amount of the non-competition indemnity due to an employee during the entire non-competition period is generally set forth in the applicable collective bargaining agreement (generally between 1/3 to 1/2 of the salary).
9. InventionUnder French law, inventions made by an employee during his/her employment are usually considered the property of the employer.
10. TerminationEmployment may be terminated for “economic reasons” or for a “personal reason”. In both cases, the employer must prove that it has a “real and serious reason” to terminate the employment. This test is often difficult to meet.
In case of termination for economic reasons, the employer cannot independently decide which employees will be terminated. It must apply “termination criteria” (based on the employee’s family situation, seniority with the company, age, handicap and professional competence).
An employer who terminates 10 or more employees during a 30-day period must implement a job protection plan (“plan de sauveguarde de l’emploi”). Such a plan must provide for precise and concrete compulsory measures aimed at avoiding or limiting the number of terminations (through the reduction of work hours, recourse to time shares, the development of new activities, training activities, …).
11. Employee representativesEmployee representatives (“délégués du personnel”) must be elected in companies with 11 or more employees. Likewise, companies with at least 50 employees must put into place a work’s council (“comité d’entreprise”), and employee representatives must be elected at work’s council level.
Both employee representatives and members of the work’s council are “protected employees”. For instance, they cannot be dismissed for any reason whatsoever without the prior written authorization of a French work inspector.
The role of the employee representatives is to represent the employees as a whole and thereby permit their interests to be continually taken into account in decisions relating to the economic and financial management and evolution of the business, the organisation of work, professional training and production techniques.
12. Law fluctuationThe employment field in France is one where the laws and practices frequently change. New issues and exposures may arise through the evolution of case law or new legislation. It is important to periodically review French employment practices with counsel familiar with the field.