employment law overview france 2019-2020 - L&E …... employment law overview france 2019-2020Flichy Grangé Avocats / Proud Member of L&E GLOBAL an alliance of employers’ counsel

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employment law overview france 2019-2020Flichy Grangé Avocats / Proud Member of L&E GLOBAL

an alliance of employers’ counsel worldwide

http://www.leglobal.org

table of contents.


i. General overview 01II. PRE-EMPLOYMENT CONSIDERATIONS 07III. EMPLOYMENT CONTRACTS 09IV. wORkINg CONDITIONS 11V. ANTI-DISCRIMINATION LAwS 14VI. SOCIAL MEDIA AND DATA PRIVACY 16VII. AuThORISATIONS fOR fOREIgN EMPLOYEES 17 VIII. TERMINATION Of EMPLOYMENT CONTRACTS 18IX. RESTRICTIVE COVENANTS 23X. TRANSfER Of uNDERTAkINgS 25XI. TRADE uNIONS AND EMPLOYERS ASSOCIATIONS 27XII. EMPLOYEE BENEfITS 32

i. general overview

2. Key Points•Allnon-EUcitizensneedaworkpermittowork.•Employersandemployeesare free tonegotiatethe terms and conditions of their employmentrelationship. However, employees have variousminimumrightsunderthelaw,regardlessofanyprovision to the contrary in their employmentcontract.

•Usually,employeeswork35hoursperweek.Onlyhoursworked at the request of the employee’ssuperiorwillberegardedasovertime.

•Indefinite-term contracts: There must be realand seriousgrounds fordismissal (two typesofvalid grounds: personal grounds and economicgrounds).

•Severance payments are only awarded if theemployeehastheminimumlengthofserviceandtherelevantCBAprovisions.

3. legal frameworKEmploymentlawinFranceisbasedprimarilyonthefollowingsources,setoutinorderofpriority:

•TheConstitution.•Europeanlegalinstruments:ConsistingofEUlaw(including Treaty provisions, EU regulations andDirectivesandthecaselawoftheEuropeanCourtofJustice)andtheEuropeanConventionfortheProtection of Human Rights and FundamentalFreedoms.

•TheLabourCode:Madeupof laws, regulationsanddecrees,theLabourCodedeterminesnearlyeveryaspectofFrenchemploymentlaw.

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•Caselaw:TheprovisionsoftheLabourCodeareinterpretedthroughdecisionsoftheemploymentlawsectionofFrenchtheSupremeCourt(“Courdecassation”).

•Collective Bargaining Agreements (“CBAs”)(“Conventions collectives”): CollectiveBargainingAgreementsarewrittenagreements,entered into between one or more employeerepresentative trade unions and one or moreemployer representative organisations. Theygovern individual and collective employmentrelationships,working conditionsandemployeebenefits in a given industry (e.g., the chemical,banking and pharmaceutical industries).Collectivebargainingagreementscanbebindingonallemployerswhoselineofbusinessiscoveredby the agreement.

•Collective company agreements (“Accordsd’entreprise”):Theseagreements,whichapplytospecific companies, are signedby theemployerand, in principle, trade union representativespresentinthecompany.

•Atypical agreements: At company level,agreementsmay be entered intowith the staffdelegatesortheWorksCouncilratherthanwithtradeunionrepresentativesand, insuchacase,they are defined as atypical agreements. Theydo not come under the category of collectivecompany agreements. They are consideredbinding by the case law as a “unilateralcommitment” (“engagement unilateral”) of theemployer.

•Common practices (“usages”): These are thegeneral, fixed and constant practices of theemployer. They concern, in particular, benefits

1. introductionInFrance,employmentlawaffordsemployeesagoodlevelofprotection.Nevertheless,thislegalenvironmentis constantly changingasa resultofgovernment reformsandcase lawevolution.Recent trends relate inparticularto: (1)unionrepresentationandcollectivebargainingagreements; (2)workingtime;(3)mutualtermination agreements; (4) senior management compensation; and (5) termination packages in listedcompanies.InFrance,choosingthewrongoptionmayresultincostlyindividualorcollectivelitigation.


employment law overview2019-2020 / france

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grantedtoemployeesandsomedetailsregardingtheoperationofstaffrepresentativebodies.TheCompany may revoke those common practicesat any time, subject to notifying the staffrepresentatives and each individual employeeconcerned, along with respecting a reasonablenoticeperiod(normallythreemonths)betweenthe notification of the employees and therevocationofthecommonpractice.

4. new develoPments Recently, the French government has profoundlymodifiedemployment law in France, through theadoptionofamajoroverhaulofkeyprovisionsofthe French Labour Code.

Thekeyaspectsrelatetothesimplificationofthestaff representative structures and significantefforts to secure dismissals. There are plenty ofothermeasuresofimportance,asdetailedbelow.

Thisreformacceleratesthetrendsalreadyinitiatedunder President Hollande through three majorlabourlawsrespectivelyenteredintoinJune2013,August2015andAugust2016.

changes to negotiating collective bargaining agreementsBywayofbackground, it shouldbenoted that inFrance, employers must comply with the labourcode, but also with the applicable sectorialcollective bargaining agreement (CBA), if any. AsectorialCBA isacollectivebargainingagreemententered by Unions representing employees ontheonehandandUnionsrepresentingemployeesonthenational level inadefinedbusinesssector.OnceextendedbytheLabourministry,itbecomesmandatory for any company whose activity fallswithin the scope defined by the agreement. Ontheotherhand,acompanymayalwaysenterintocompany collective bargaining agreements withUnionsbeingpresentinsaidcompany.

TheMacron reform provides for some importantchanges in this area.

imProved caPacity to breaK with sectorial cba’sUntil recently, it was not possible to derogate tosectorial CBA’s with a company-wide agreement,unless itwasmore favourable for theemployees.

This has progressively changed, starting in 2008asfarasworkingtimeisconcerned,thenin2016,and most recently with the Macron labour law reformthathascreatedthreedifferentcategoriesor“blocks”:

“Block 1” matters: the sectorial collectiveagreementprevailsovercompanyagreementsona list of 11 topics. For example, minimum wageprovidedforbytheCBAcannotbederogatedbyacompanyagreement.

“Block 2” matters:thesectorialagreementprevailsover former company agreements if the sectorialCBA provides for it. This concerns 4 topics. Forexample, policies regarding the insertion ofhandicappedindividualsintotheworkforce.

All other subjects not included in the previous two blocks constitute “Block 3”: CompanyagreementprevailsoverthesectorialCBA.

new majority rules for entering into a comPany collective bargaining agreement Under French law, company agreements areentered into by the employer and the Uniondelegates(beingemployedinthecompany)havingbeenappointedbyUnionsbasedontheresultsofthevotesinthefirstroundofthelastelectionsoftheworkscouncil(onlyunionsareabletopresentcandidatesoverthisfirstround).

Theprincipleofthemajoritycollectiveagreementapplies to all company agreements as of May 1,2018: to be valid, the agreement must then besigned by one or more trade unions that received 50%ofthevotescast.

However, if the signatory representative tradeunion organisations only have 30 to 50% of thevotes, it is possible to then use a new backupplan: revert to a company referendum meaningthatalltheemployees’opinionsinrelationtotheagreement may be sought in order to render the agreement enforceable.

increased caPacity to enter into a collective bargaining comPany agreements in small comPanies or without trade unions In France, some matters require a collectiveagreement,suchastherecoursetospecificworking




time arrangements. Small businesses withoutunions were struggling to enter into an agreement whereneeded. TheMacron reformhas thereforefacilitated theability to enter into an agreement,by enabling to sign, if no union would appointan employee, with an elected staff member orevenwith theworkforcedirectly, under a certainconditions.

securisation of comPanies’ cbaSince case law can be quite unpredictableand because changes are commonplace, theGovernmentwished toprotectemployersagainstconsequencesofarulinginvalidatinganagreementorsomeofitsprovision,whichwouldthentriggerconsequencesforthefuture,butalsoforthepast,asitisadmittedthatcivilcaselawhasaretroactiveeffect. The law now states that if it appears thattheretroactiveeffectof thatannulmentwillhavemanifestly excessive consequences, there is thepossibilityforajudgetodecidethatthecancellationof all or part of an agreement will only bear aneffectforthefutureortomodulatetheeffectsofhisdecisionintime.

frequency and content of mandatory negotiationsCompanieswhereunionsarepresentarerequiredto conduct negotiations on some items listed bythe Labour code, under a certain frequency. Themost important one is the annual negotiationonwages,workingtimeandprofitsharing.

Itisnowpossibletosetoutbycompanyagreement,thetopicsofmandatorynegotiationinthecompanyand the content of each theme. However, someissues,setoutbylaw,mustbenegotiatedatleastonceevery4years.

Topicsthatcanalsobesetoutbyagreement:

•thefrequencyofcompulsorynegotiations(upto4years),

•thecalendarandmeetingplaces,•information provided by the employer (oremployers’ organisations) and the date ofdelivery,

•theproceduresformonitoringthecommitmentsenteredintobytheparties.

Such a company agreement is concluded for amaximum duration of 4 years and can set theperiodicityofitsrenegotiation.

Staff Representation: the CSE (The Social andEconomicCommittee)

TheMacronReformhassignificantlysimplifiedstaffrepresentationincompanies.Uptonow,therehavebeenthreetypesofstaffrepresentativebodies,allofwhicharechairedbytheemployer:

• in companies with 11-49 staff: staff delegates(déléguésdupersonnel),

•incompanieswith50andabove:staffdelegates,aworkscouncil,andahealthandsafetycommittee.

The staff delegates were in charge of relayingclaimsregardingtheday-to-dayworkinglifeofthecompanystaff,whiletheworkscouncilismainlyincharge of economicmatters, and the health andsafety committee deals with health and securitymatters.

OneofthemainpointsintheMacronreformsisthemerging of the current three staff representativebodiesintoone.TheWorksCouncil,StaffDelegates,and Health and Safety Committee are nowcombinedintotheSocialandEconomicCommittee:theCSE.Notethatitwillalsobepossible,subjecttotheexistenceofacollectiveagreement,insteadofaCSE,toimplementaConseild’entreprise.ThisbodywouldbasicallyhavethesameprerogativesastheCSEbutwould,inaddition,beabletoenterintoandrevisecollectiveagreements, insteadoftradeUniondelegatesthatwouldnolongerexist.

timeframe for the cse to be imPlementedThe minimum threshold for mandatoryimplementation iswhenthecompanyemploysatleast11employeesfor12consecutivemonths. Inprinciple,theCSEissetupattheendofthecurrentmandateoftheelectedstaffrepresentatives,oratthe renewalofoneof thesebodies. Inanycase,theverylatestfortheimplementationoftheCSEis31December2019.

Thebodyhasthesameconfiguration,regardlessofthesizeofthecompany. Itmust includeahealth,safety and working conditions commission incompaniesandseparateestablishmentsthathaveatleast300employees.

ThenumberofseatstotheCSEvaryinproportionto the staff headcount. It ranges from 1representativeforcompanieswith11employeesto



35representativesforcompanieswithover10,000employees.

cse’s resPonsibilities CSE’sresponsibilitiesincompanieswithfewerthan50employees

Therehasbeenacarry-overofmostassignmentsformerlyentrustedtotheStaffDelegates:

•they can therefore present individual claimsrelating towages, the applicationof the labourcode,etc.

•theywillhavearoleinthepromotionofhealth,safety and working conditions in the company,investigationofaccidentsatworkoroccupationalillnesses.

•they can refer to the labour inspectorate allcomplaints and observations relating to theapplicationoflegalprovisions.

cse’s resPonsibilities in comPanies with 50 or more emPloyees There has been a carry-over of the powerspreviouslyassignedtotheStaffDelegatesexplainedaboveaswellas thosepreviouslyassignedtotheWorksCouncil:

•The CSE remains informed and consultedon matters concerning the organisation,management and general operation of thecompany.

•The CSE remains informed and consultedperiodicallyon:

•thestrategicorientationsofthecompany•the economic and financial situation of thecompany

•the social policy of the company, workingconditionsandemployment

•Finally, the CSE has prerogatives that wereformally those of the Health and SafetyCommittee(CHSCT).

changes to rules regarding dismissals

General Rules

Inthepast,someemployershavebeensentencedtopaydamages,becausetheyfailedtocomplywithcertain formal legal requirements regarding thewaythedismissallettershouldbemotivated.

TheMacron labour law reformhas simplified the

requirements regarding the letter, although theprocedural requirement involving a pre-dismissalmeetingremainsunchanged.

Tohelpemployersintheprocess,theGovernmentissued a template form that may be used fordismissal.

Also, a specific procedure has been set up, thatallows the employee to ask for more precisionon the grounds for his dismissal explained in thedismissalletter.

Theemployeenowhas15daystomaketherequestforfurtherexplanation.

If the dismissal letter is ruled as insufficientlymotivated,thiswilltriggerthepaymentofdamagesfor unfair dismissal (see below).

statutory severanceUnderFrenchlaw,dismissaltriggersthepaymentofastatutoryseveranceor,ifmoreadvantageous,theseveranceprovidedforbytheapplicablesectorialCBA, if any. The Macron reform increased thestatutory severance and makes it mandatory foremployeeswhoselengthofserviceisof8months(instead of one year).

Theformulaisnowthefollowing:

•1/4ofamonth’ssalaryperfullyearsofserviceupuntil10years,

•1/3ofamonth’ssalaryperfullyearsofservice(asof)above10years.

The reform does not change the fact that adismissal for gross or serious misconduct (faute graveou lourde)doesnot trigger thepaymentofany severance.

statute of limitations to challenge a dismissal Overthepastdecade,Parliamenthasperiodicallyreducedthestatuteoflimitations.

Just as for economic dismissals, the statute oflimitation to challenge a dismissal based onpersonalgroundsisnowoneyear.

Thereformcontainsspecificprovisionstodealwithongoing time limitations for dismissals notifiedbeforeSeptember24,2017.



Thistime limitationdoesnotapply todisputes inrelationtothecontract’sexecutionnortosituationstriggering a nullity (violation of protection ofpregnantwomen,discrimination,etc.).

Pleasenotethatthe3-yearsstatuteof limitationsstill applies for claims in relation to wages andovertime,inparticular.

indemnification French regulation was criticised by employersbecause of the uncertainty as to their potentialfinancial exposure once they have dismissed anemployee.

Indeed,LabourCourtscouldbequitesevereandtheamountofdamagesgrantedcouldvarydependingonthejurisdictionrulingthecase.

Anyemployeeworkinginacompanyemployingatleast11employeesandhaving2 yearsof servicecould obtain indemnification of 6 months’ salaryincasehisdismissalwasruledunfair,whichcouldhappenquiteoften.Ontheotherhand,therewasnocap.

TheMacronreformnowimposesabindinggradingscaletotheLabourCourtbasedontheemployee’sseniorityaccruedwithinthecompany.Forexample,2 years of seniority will entitle the employee todamages between 3 and 3.5 months of salary(in companies with at least eleven employees).10 years of senioritywill entitle the employee todamagesbetween3and10monthsofsalary(again,incompanieswithatleastelevenemployees).Thisgradingscaledoesnotapplyincasethedismissalisrulednullandvoid.Neitherdoesitcoverparticularprejudices,nordoesitapplytoclaimsinrelationtotheexecutionoftheemploymentcontract.

economic dismissal Since2013,theFrenchGovernmentandParliamentaimedatmakingtheeconomicdismissalprocedureeasier or at least a bit less severe towards large groupsandcompanies.

TheMacronreformdealswith:

• The perimeter within which the economicrationaleshallbeassessed.

Before the reform, the economic rationale wasassessed at the level of the business sector of the

Group to which the French company belongs toworldwide,andnotonlyinFranceorintheE.U.Thiswouldthentriggerdamagestobepaidfor“unfairdismissal”even incasetheFrenchsubsidiarywasexperiencing losses for many years, because the“business sector” of the Group itself was quiteprofitableworldwide.

This economic rationale is defined as either“economic difficulties” or the “need to safeguardthe competitiveness” or “technological changes”or,finally, the totalanddefinitiveshutdownofaFrenchlegalentity.Thelawdidnotchangethis,northefactthattheGroup’ssituationstillneedstobetakenintoaccount;italsomaintainedthereferencetothe“businesssector”ofsaidGroup.

However, it is now possible to only focus on theGroup’seconomicsituationinFrancealone.Indeed,SectionL.1233-3ofthelabourcodeprovidesthat:“Economical issues, technological transformationorthenecessitytosafeguardcompetitiveness,areassessedatthecompanylevelifitdoesnotbelongto a Group and, otherwise, it must be assessedunder the scope of the other companies of theGroup,operatinginthesamebusinesssector,andestablishedonthenationalterritory”.

Thissectionthenprovidesforsomedefinitionsofthe Group depending on where the “dominant”company(parentcompany,basically)islocated.

Finally, the law now indicates that the “businesssector is characterised, in particular, by the typeof products, goods, or services, the targetedcustomers,thedistributionnetworksandmethods,allrelatingtothesamemarket”.Thisenumerationseems to confer a significant importance to the“market” criteria, but it might be subject to adifferentinterpretationfromthecourts.

•Theinternalredeploymentduty:thereformputsanendtothedutytosearchforinternalpositionswithinthecompany’sGroupabroad.

This fundamental requirement is now limited toFrancealone,stillwithintheGroup’sperimeter.The reform also eases the process for proposingredeploymentopportunities.

TheemployermaynowstartbydeliveringalistofavailablepositionswithintheGroupinFranceonly.Theemployeehas15daystoshowinterest.



agreements organising collective terminations by way of agreement Since 2008, entering into a mutual terminationagreementwithanindividualemployeeispossible.Thisagreementhastobesubmittedtothelabouradministration’sapproval,whichcanbeimplicit.Thisschemehasproventobeverypopularandnotconflictual.

On the other hand, since 2013, themass layoffsproceedings (at least 10 job eliminations incompanies of 50 employees or more) had beenplaced under the labour administration’s control,and negotiation of the redundancy packagewith unions were strongly encouraged. Thisreformproved tohaveapositiveoutcomeas theproceedings became less conflictual, and theirdurationandoutcomemorepredictable.

Although those “forced departures” plans havebecome less conflictual, it remains a trauma fortheworkforce,andasignificantsourceoffinancialexposureforthecompany.Also,thisprocess,evenincaseanagreementisbeingreachedwithunions,still involves quite a long consultation processwiththeWorksCouncilandtheHealthandSafetyCommittee. Conscious that entering into forced departureplans might not always be the best way to dealwith a need to reduce the size of theworkforce,whenvoluntarydeparturesappeartobepossible,the Macron Government imagined a new scheme called“mutuallyagreedtermination”,placedunderthe labour administration’s control, and subjectto an agreement being reached with Unionsrepresentingthemajorityoftheworkforce.

Entering into this agreement does not require aconsultation of the elected staff representatives,but they must be informed.

Itmaybeimplementedonlytoorganisevoluntarydepartures,meaningthatanemployeewhowouldbelong to a targeted job categorymust not havehis job eliminatedor substantially altered if he isnotacandidatetothiscollectivedeparture,thatisproposedbytheemployer.

teleworKThe Macron reform brings telework provisionsinto the 21st century, with the possibility of itsimplementationbycollectiveagreementor,failing

that,byacharterdrawnupbytheemployerafterapossibleconsultationwiththeCSEinsomecases.Intheabsenceofacharterorcollectiveagreementontelework,itispossibletosetupteleworkviaanagreementbetweentheemployerandemployee,formalised by any means.

ii. PRE-EMPLOYMENT considerations 1. does a foreign emPloyer need to establish or worK through a local entity to hire an emPloyee?ItisnotnecessarytoestablishalocalFrenchentityinordertohireanemployee.However,theforeignentityandtheemployeewillhavetoberegisteredwiththeFrenchsocialsecurityofficeofStrasbourg,whichisuniquelycompetentforsuchmatters.

2. limitations on bacKground checKsBackground checks in France are limited to thestrictly necessary verifications of a candidate’squalifications, experiences, and references.Criminalbackgroundchecksare limitedtocertainprofessions that entail security responsibilitiesor that involveworkingwith childrenor sensitiveinformationormaterials.CreditbackgroundchecksdonotexistinFrance.

3. restrictions on aPPlication/interview questionsThe employer can only collect information aboutcandidates, which facilitates the assessment oftheirprofessionalskillswithregardtothepositionthat is offered. These professional skills must bedirectlyrequiredfortheposition.

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Thisrighttocollectinformationshouldbebalancedwiththerespectofthecandidate’sprivacy.

The employers should run candidate selectiontools (i.e. “recruitment methods or techniquesof job applicants”) before theWorks Council, forinformation.

Finally,allinformationcollectedontheprofessionalbackgroundofacandidatefromformercolleagues,employees,clients,suppliers,etc.islegalaslongasitisnotunbeknownsttothecandidate.

tools used to conduct bacKground checKsEmployersmaymake use of all information fromtheInternet,irrespectiveofwhetheritwaspostedon social or work-oriented networks. In France,theprivateemployer is generallyprohibited fromreviewinganypreviousconvictions,aswellasthecandidate’sfinancialposition.

If applicable, the employer can – only by settingforthalegitimateinterest–askforextractn°3ofthecriminal record,which lists theheaviestpenaltiesand can only be applied for by the candidatehimself,safeexceptionsinthefieldsofbankingandhealthcare.

interviews with Potential candidates The employer has the right to ask questionspertaining to the candidate’s professionalbackground(previouspositions, formeremployer,grounds forprevious termination, ifhe isheldbyanon-competeclause,etc.)andtorequestfortheproductionofdocumentssuchasworkcertificates(but not pay slips), diplomas, driver’s license (ifappropriate),etc.

Itisanobligationtocheckthattheemployeeholdsaspecificenablingwhenrequired(i.e.administrativeagreementorprofessionalcard).




However, the employer may not ask questionspertaining to his private life, such as sexualorientations,religion,tradeunionsactivities,healthissues,financialissues,etc.Socialsecurityenquiriesabouttheapplicantaregenerallyprohibited,exceptiftheapplicantisnotyetregistered.

Thecandidateshouldanswer ingoodfaithtothequestionshavingadirect andnecessary linkwiththe employment at stake. When the employerdiscoversanemployeehasliedonhisbackground,theemployerwillbeabletodismisstheemployeeonlyifhedemonstratesthattheemployeedidnothavetherequiredcompetencesforthejoborthatthediplomawasessentialtoperformhisduties.Pre-employmentskilltesting

Pre-employment testing constitutes a pertinentmethod to assess the professional qualificationof the candidate and his ability to perform theproposedduties.

However, it is importantthatthecandidate isnottested in real conditions of employment, as thiswouldbeconsideredasatrialperiodandthusanemploymentrelationship.

Moreover,drugandalcoholscreeningofemployeesisallowedpursuanttotheemployer’sdisciplinarypowers, but only under certain conditions (forexample, that the screening is provided by theinternalrulesofthecompany).

storing dataTheemployermaystorethedatacollectedonthecandidatesonly thetimenecessary for thehiringprocess, unless the storing is authorised by theCNIL. However, the storing cannot exceed twoyearsfromthelastcontactwiththeperson.

TheCNILrecommendsthatthestorageofcandidateoremployeedataispossibleafterpriorclarificationregardingtheaffectedcandidateoremployee,whocanrequestatanytimethatthedatabeerased.

EmployersadditionallyhavetheoptionofsettingupbiometricIDsystemsontheiremployeesiftheCNIL,theFrenchdataprotectionwatchdog,approvesoftheir introduction, after prior consultation of theworkersdelegates.

legal sanctionsIftheemployerviolatestheabove-referencedlegalprovisions or employee rights, the employee canclaimdamagesorsanctionsundercriminallaw.

An employer could face up to three years ofimprisonment and a fine of up to EUR 46,000in the event of discrimination with regard to anemployee’smembershipofatradeunion.


iii. emPloyment contracts1. minimum requirementsEmployment contracts are generally not requiredto be written, but certain forms of employmentcontract should be in writing (notably fixed-termcontracts, part-time contracts and temporaryemployment contracts). The employer shouldprovide the employee with a written statementof theessential termsgoverningtheemploymentrelationship. Oral fixed-term contracts areunequivocally deemed to be indefinite-termcontractsandoralpart-timecontractsaredeemedfull-timecontracts.

Indefinite-term contracts should contain thefollowinginformation:

•identificationoftheparties;•theemployee’sjobtitleoradescriptionoftheirduties;

•workingtime;•theemployee’scompensation;•theplaceofwork;•theemploymentstartdate;•thelengthoftheprobationaryperiod;•theholidayentitlement;•theapplicableCBA.

Fixed-term contracts should contain the sameinformation as indefinite-term contracts and, inaddition,fixed-termcontractsshouldspecify:

•thereasonwhythecompanyisusingafixed-termcontract;

•thedateonwhich thecontract is toend,or itsminimumduration if an exact termination datehasnotbeenfixed;and

•the name and job description of the absentemployee, if the reason for using a fixed-termcontract is to replace a temporarily absentemployee.

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In addition to the general requirements foremployment contracts listed above, part-timecontractsshouldstatethefollowing:

•thatthecontractisforpart-timework;•theemployee’sworkinghours;•any conditions relating to possible changes inworkinghours;and

•theamountofovertimepermittedaccording tostatute or the relevant cba.

Further,sincethelawofJune2013onthesecurityof employment,part-timecontractsmustbeof aminimumdurationof24hoursperweekunlessanexceptionapplies(forexamplebranchagreements,attherequestoftheemployeeinordertoaddressapersonalsituationortoundertakevariousworkactivities, students under 26, certain employersand intermediary associations). Moreover, part-time working hours have been rendered moreflexible, as remuneration may now be modifiedwithmajormodifications(hoursexceeding10%ofthecontractualhours)tobeapprovedbyabranchagreement,andwiththepossibilityoftemporarilyincreasingthecontractualworkingtimeofapart-timeworker,againwithapprovalthroughabranchagreement. Finally, where 1/3 of the company’sworkforce isemployedpart-time,companiesnowhavetheobligationtonegotiatepart-timeworkingarrangements.

2. FixEd-TERM/OPEN-ended contractsTheindefinite-termcontract isthetypicalformofemployment relationship. As a rule, the validityof an indefinite-term contract is not subject toconditions regarding thecontentand formof theagreement. In that respect, French case law hasheldthatapayslipmaybesufficienttoformaliseanindefinite-termcontract.




A fixed-term employment contract is anemployment contract entered into for a definedduration, set in advanceby theparties. This kindof employment contract is very specific, notablyasneitherpartymayterminateitpriortoitsend,except in the event of an amicable separation,seriousmisconduct(“fautegrave”), forcemajeureor if the employee finds alternative employmentunderanindefinite-termcontract.

In contrast with indefinite-term contracts, theconclusion of a fixed-term contract is subjectto conditions of content and form. However,employees working under fixed-term contractshave the same individual statutory rights as those workingunderindefinite-termcontracts.

3. trial PeriodRatherthanenteringintothecontractimmediately,partiestotheemploymentcontractmayagreetoprovideforaprobationaryperiod,whichcanonlybe renewed once and under condition, duringwhicheitherpartymayterminatetheemploymentcontractwithoutanyformality. Ifbothpartiesaresatisfied at the end of the probationary period,theemploymentcontractbecomesdefinitive.Theprobationary period is governed by statute. Thelegislature has introduced amaximum length forthe probationary period and a minimum noticeperiod, which varies according to the categoriesofemployeesconcerned.Thetrialperiodthatmaybe mentioned in fixed-term contracts is fixed bytheLabourCodeaccordingtothedurationofthecontract.

4. notice PeriodExcept for specific exceptions (e.g. dismissalsfor serious or gross misconduct), the partiesshould observe and cannot waive the requirednotice periods before an indefinite-term contractis terminated. The length of the notice periodis generally determined by the national CBA.Employeeswhoaredismissedormaderedundantareentitledtopaymentinlieuofnoticeiftheyarenotrequiredtoperformtheirnoticeperiod.


iv. worKing conditions 1. minimum worKing conditionsEmployers and employees are free to negotiatethe terms and conditions of their employmentrelationship. However, employees have variousminimum rights under the law, regardless of anycontrarylanguageintheiremploymentagreement.Theseminimumworking conditions are set forthin the French Labour Code and the applicableCollectiveAgreement,amongothersources.

2. salaryAsof1January2016,theminimumgrossmonthlywage is EUR 1,498.47 (about USD 1, 753) fora 35-hour workweek. All employees who areemployedunderanordinaryemploymentcontract(either indefinite or fixed-term) are entitled totheminimumwage.CBAsalso frequentlyprovidegreaterminimumwages(whichvaryinfunctionofjobcategories).

3. maximum worKing weeKUsually,employeeswork35hoursaweek.However,employers can agree on a longerworkweekwiththeir employees. In that case, any work over 35hours a week is payable as overtime (althoughthereisnoentitlementtoadditionaldaysoff).

In any event, employees should not work morethan:

•an average of 44 hours a week during any 12consecutiveweeks;

•48hoursduringanygivenweek;•10hoursaday.

It ispossibletonegotiateamoreflexibleworkingschedule for all employees with trade unionsat company level. A law dated 20 August 2008reforming working time (“Loi portant renovationde la démocratie sociale et réforme du tempsde travail”) (“Working Time Law”) provides forworkingtime tobe reorganisedat company level(subject to applicable CBAs). Working time cannotably be reorganisedon amultiple-weekbasis,i.e.theemployeeworksanaverage35hoursover4(ormore)weeks,whilehisworkingtimeisdifferenteachweek.

However, statutory restrictions on working timeshouldbemetandtheemployeesdulyinformedoftheworkingschedule.

Specialrulesapplytoautonomousexecutives(thatis to say executives of a certain level who freelyorganise their working time). For example, the”forfait-jours”agreement(lumpsumremunerationforaworkingtime indaysagreement)which isamechanism that allows the working time of anemployeetobecalculatedbythenumberofdaysworked per year instead of the usual number ofhoursworkedperweekormonth. “Forfait jours”agreement is only possible for certain employeesand provided certain conditions, notably whereit has been authorised by means of a specificcollective agreement (“accord collectif”). TheFrench Supreme Court has recently invalidatedsome “forfait jours” agreements that failed toensure the employee’s health and security, andnew collective bargaining agreement provisionswerenegotiatedinseveralsectors.

4. overtimeOnlyhoursworkedinexcessofthestatutoryweeklyworking hours at the request of the employee’ssuperiorwillberegardedasovertime.However,the


employment law overview2019-2020 / france | 11

employer has theduty to ensure that employeesdonotexceedthedailyandweeklylimits.

Those who work overtime are entitled tocompensatory payment involving a surcharge(whichisgenerally25%forthefirst8hoursputinduringtheweek,then50%),andwhichcannotbelessthan10%,oftheemployee’sstandardpay.Eachovertimehourmayeitherbepaidorcompensatedwithcompensatoryrest,i.e.everyhourofovertimeworkedgivesrisetoeither1hourofpayor1hourofrest,plustherelevantsurcharge.

Allovertimehoursperformedarecomputedwithintheyearlyovertimelimit(“contingent”).

According to French law, the employer is free torequire each employee to work overtime up toanannual limitagreedintheapplicablecollectiveagreement or, in the absence of a collectiveagreement,uptoalegallimitof220hoursperyearperemployee.

Provided the employer does not require theemployee to work beyond the legal limits, theemployeehasnorighttorefusetoworkovertime.Over this threshold, the employee is entitledto “mandatory rest” in addition to financialcompensation.

The employer can only request the employee towork inexcessof the legally recognisedovertimelevelifhehasconsultedtheWorksCouncilor,intheabsenceofaWorksCouncil,staffrepresentatives.

The employee’s total working hours in a givenmonthshouldberecordedinwritingonhis/herpayslip,withovertimeclearlyindicatedonaseparateline.Failuretodosoconstitutesacriminaloffense.

5. health and safety in the worKPlace

A. EMPLOYER’S OBLIgATION TO PROVIDE A hEALThY AND SAfE wORkPLACE

The employer’s safety obligation is not limitedto the prevention of occupational accidents anddiseases. It is much broader and covers all risks

towhich theemployeemaybeexposedatwork,includingpsychosocialrisks.Thisisanobligationofresult.

Professional risk prevention measures should besought, employees should receive informationand training about these risks, and the employershouldbe compliantwith certain specific rules inthe arrangement and use of premises to ensurethe health and safety of the employee. Forexample, premises should be clean and clear ofclutter, facilities and technical and safety devicesmaintainedandchecked regularly, theemployeesshouldhaveprotectionagainst smoking and loudnoises,sufficientlight,etc.

The employer should assess potential risks in adocument called a single document occupationalrisk assessment (DUERP), including: 1) the choiceof manufacturing processes, work equipment,the chemical substances or preparations; 2) thedevelopment or redevelopment of workplacesor facilities; 3) defining workstations; and 4) theimpactofinequalitiesbetweenwomenandmen.

Mandatory for any business, this documentincludes: i) an inventory of the risks identifiedin each of the business units of work; ii) theclassification of these risks; and iii) proposals foractionstobeimplemented.

The DUERP should be updated once a yearminimum.

TheLabourInspectorwillcheckthatsafetyrulesinthecompanyareadheredto.Whereanemployerisnegligent,thepowersoftheLabourInspectorarethefollowing:

•draftminutesandgivenoticetotheemployerforviolations,

•seizeinsummaryprocedurethereferraljudgeincaseofaseriousrisktothephysicalintegrityofaworker,

•prescribe all necessary measures, including,in case of grave and imminent danger, thetemporarycessationofworkoncertainprojects.

The liabilityofanemployerwho fails toabidebysafetyrequirementsincludes:

•civillyliabilityincaseofaccidentorillnessoftheemployee,





•criminal liability (fines and, in some cases, jailsentences).

B. COMPLAINT PROCEDuRES

The new Sapin II law expands extra-territorialreachforFrenchprosecutors.Thelawappliesfullyto corruption by French companies overseas andforeigncompanieswhohaveapresenceinFrance.

C. PROTECTION fROM RETALIATION

It should also be noted that the Sapin II lawexpresslyprovidesforthepossibilityforemployeestoappealtotheLabourCourt,bywayofsummaryjudgment, in the event of termination of theemploymentcontractfollowingthenotificationofan alert within the meaning set out by the law.

V. ANTi-diSCRiMiNATiON laws1. brief descriPtion of ANTi-diSCRiMiNATiON laws Theprincipleofnon-discriminationisacoreaspectofFrenchLabourlaw.Thesourcesofdiscriminationlawarediverse.ThefirstisconstitutedofEuropeanlaw that has largely determined the French law of discrimination.ThesecondcomesfromtheFrenchconstitution. The principle of non-discriminationhasconstitutionalvalue,byvirtueofthePreambleto the Constitution of 1946 that prohibitsdiscriminationwith regard tocriteriaof sex, race,beliefandtradeunionactivity,andofthecurrentConstitutiondated1958thatcontainsaprovisionaccording to which “the nation ensures equalitybeforethelawofallcitizens,whatevertheirethnicorigin, race or religion” (article 2 of the FrenchConstitution).

TheFrenchLabourCodecontainsseveralprovisionsondiscrimination, especially a provision that listsall grounds of prohibited discrimination (articleL.1132-1andfollowing).

2. extent of Protection AccordingtotheFrenchLabourCode,itisforbiddentopunishordismissemployees,orexcludepotentialemployeesfromtherecruitmentprocess(forajob,a training position or an internship), or enduredirect or indirect discriminatory measures with respecttoremuneration,incentiveschemes,sharedistribution, training or redeployment programs,posting, qualification, classification, careerdevelopment,mobilityorcontractrenewal,onthebasis of their: origin, gender, sexual orientation,morals, age, marital status, religious beliefs,nationality,ethnicorracialorigin,politicalopinions,

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tradeunionactivities,physicalappearance,name,medicalcondition,disability.

The burden of proof is lighter for the employeewho alleges discrimination: the employee mustinvoke facts likely to demonstrate discrimination,while the employer has to demonstrate that thedifference observed is justified by objective non-discriminatory elements.

Discrimination is a criminal offence punishableby (i) a maximum of three years’ imprisonmentandafineofEUR45,000fortheemployer’s legalrepresentative(inmostcases,thechiefexecutive,dependingonthetypeofcompany),(ii)afineofuptoEUR225,000fortheemployer(asacompany).

3. Protections against harassmentIn France, harassment is prohibited in nationallawand takes the formofboth sexual andmoralharassment.

Moral harassment is defined as repeatedconduct which is designed to or which leads to a deteriorationoftheemployee’sconditionsofworkliabletoharmhisrightsandhisdignity,todamagehis physical or mental health or compromise hiscareerprospects.

Sexualharassmentasrepeatedstatementsoractsor pressure that is repeated or not of a sexualnature that violate a person’s dignity because oftheirhumiliatingordegradingcontentorbecausetheygenerateanintimidating,hostileoroffensiveenvironment,aswellaspressurewiththeperceivedorrealaimofobtainingsexualfavoursforaperson’sownbenefitorthebenefitofathirdparty.




SexualandmoralharassmentarebothpunishedbytwoyearsofimprisonmentandafineofEUR30,000(bythreeyearsofimprisonmentandafineofEUR45,000wheresexualharassmentiscommittedbyahierarchicalsuperior).

InFrance,whereharassmentisperpetratedbyanemployee, both the employer and the employeeare liable.

4. emPloyer’s obligation to Provide reasonable accommodations Under the current legislation, private companiesandpublicofficeswithaworkforceofmorethan20employeesmusthire6%ofdisabledworkers.Employers are provided with three options tomeet this target: (i) Hiring disabled workers asemployees, (ii) subcontracting workers from thesheltered sector, (iii) paying a contribution fee toAGEFIPH which is an organisation dedicated tofurtheringprofessionalinclusionofthedisabledintheprivatesector.

5. remediesEmployers can initiate a non-judicial in-houseinquiry if a victim of harassment brings to theirattention, or if they suspect, an incidence ofdiscrimination,as theymustguaranteeaworkingenvironmentfreeofsuchpractices.

Therightofalertoftheemployees’representativesincaseofviolationsofhumanrightsandfreedomsin the workplace entitles the representative tofile an emergency petition for injunctive reliefbefore the Labour court and applies to cases ofdiscrimination.

Since2004,aspecialbodyhasbeencreated,thathasanessentialroleinthefightagainstdiscrimination:The Defender of Rights. Any discrimination case,directorindirect,prohibitedbystatutelaworbyaninternationalconventiontowhichFranceisaparty,can be brought before the Defender of Rights.Itsmaintask is toensuretheefficacyof the legalmechanismsprohibitingdiscrimination.

Legal actions may also be brought before theLabourCourt(“ConseildePrud’hommes”)directlybyemployeeswhoallegediscrimination.

6. other requirements Frenchlabourlawdoesnotrecognisequotas,andtheprincipleofnon-discriminationbarsemployersfrom practicing affirmative action or institutingmeasures destined to favour diversity in theworkplace.


vi. social media and data Privacy 1. restrictions in the worKPlace

A. CAN ThE EMPLOYER MONITOR, ACCESS, REVIEw ThE EMPLOYEE’S ELECTRONIC COMMuNICATIONS?

No specific French employment law provisionscurrently address issues raised by employees’socialmediause.EmployerscansetoutthegeneralconditionsofuseandrestrictaccesstotheInternetintheworkplace,buttheyhavetobecautious,asallemployeeshavearight toprivacy,evenat theworkplace during working time (article L. 1121-1 of the French Labour Code). For example, theemployermayaccesstheemployees’professionalemailsunderveryrestrictiveconditions.

Besides, employees benefit from the freedom ofspeechprinciple,withinthecompanyandoutsideof it, which can only be restricted for legitimategrounds.

Article L.2323-47 provides that the company’sWorks Council, if any, must be informed andconsulted prior to the implementation of anymeans aimed at monitoring or controlling the employees’activities.

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2. emPloyee’s use of social media to disParage the emPloyer or divulge confidential informationEmployers may limit the use of social networksby requiring that employees do not discloseconfidential information or trade secrets byimplementing an obligation of confidentiality orcodes of conduct.

Concerning denigration, the issue regardingwhether comments made on Facebook arepublic or private was considered by the FrenchSupremeCourt (Cass. civ.1,10April2013). Fromthis case law, a comment on a socialmediamaybeconsideredprivateorpublicdependingontheprivacysettingsoftherelevantaccount.Themoreaccessibleacommentis,themorelikelyitwillbedeemedpublicandpunishable,asthecasemaybe.



vii. authorisations for foreign emPloyees requirement for foreign emPloyees to worK TheemployermustensurethattheemployeetobehiredisauthorisedtoworkinFrance:

•where the employee is already in France, theemployerwill have to check that theemployeehasavalidresidencepermitallowinghimtoworkinFrance,andkeepacopythereof;

•where the employee is not yet established inFrance, the employer should undergo a three-stepprocess“of introducingaforeignworker inFrance”:

o obtainfromtheFrenchunemploymentagency (“PôleEmploi”)adocumentcertifyingthat therearenoworkersavailabletofilljobsinthe

country, o filetothelabourauthorities(i.e.theTerritorial UnitofDireccte)anapplicationpackage, o informtheFrenchImmigrationOffice(the Ofii)oftheentryinFranceofanimmigrant andpaytheOfiiafee.

Anemployermustensurethevalidityoftheworkpermitoftheforeignemployeehewantstohireisvalid, by submittinga declarationof employment(by email or post mail) to the Prefecture of theplace of employment, at least 2 working daysbefore the hire. Nationals of most countries oftheEuropeanUnionhavetherighttoworkfreelyinFrancewithoutaspecificworkpermit.Theonlydocumentrequiredfortheirjobisanidentitycardorpassporttoprovetheirnationality.



viii. termination of emPloyment contracts 1. grounds for termination In the case of an indefinite-term employmentcontract,thereshouldberealandseriousgroundsfordismissal.Therearetwotypesofvalidgrounds:personalgroundsandeconomicgrounds.

Personal groundsPersonalgroundscaninclude:

•poorperformanceorunsatisfactoryprofessionalskills;

•inabilitytoperformtheassignedtasks;•misconductwithinthecompany;and•anemployee’srepeatedabsenceorabsenceovera longperiodoftime (which isnot related toawork-relatedaccidentorillness)which,incertaincircumstances,canalsoconstitutevalidgroundsfor dismissal.

economic groundsThe Labour Code allows two main economicgroundsfordismissal:

•economicdifficultiesfacingtherelevantbusinesssectoratagrouplevelinFrance;and

•technologicalchanges.

As the above list is merely indicative, case lawallows other economic grounds for dismissal,namely where it is necessary to safeguard the competitivenessoftherelevantbusinesssectoratgrouplevelandinthecaseofcessationofbusinessactivity.

Thecompanymustimplementmeasurestopreventthe dismissal of the employee. Therefore, beforeorduringtheprocess,thecompanyisrequiredtoimplement various preventivemeasures, supportandreclassificationoftheemployee.

2. collective dismissalscommon rulesThecommonrulesthatapplytocollectivedismissalproceduresare:

•orderofdismissals,•redeploymentefforts,•informingthelabourauthorities.

The redeployment efforts should be carried outthroughout the group in France. The employershould offer individual and precise offers to thetargetedemployees.

In caseof failure to complywith these rules, thedismissal may be considered unfair by the Labour Courts.

ProcedureTheprocedurewillvaryinfunctionofthenumberofemployeesmaderedundantoveraperiodof30days.

Less than 10 redundancies over 30 days In collective redundancies involving companiesof less than 50 employees, the company shouldconsult theworkers’ representatives (i.e.workersdelegatesforcompaniesoflessthan50employeesandWorks Council in companies of 50 or more)on the redundancy project. In practice, aneconomic notewill be handed in to theworkers’representatives presenting the reasons for theredundanciesandthemeasurestobetaken.

Theemployeeswillbe individually convened toapre-dismissal meeting where the project will bedescribedandtheeconomicmotivesdetailed.Theemployerwillalsohavetopresentinformationonaredeploymentscheme(i.e.“ContratdeSécurisationProfessionnelle” (CSP) or redeployment leave,dependingonthesizeofthecompany).




The employer will have to inform the LabourAuthorities in writing of certain details of theredundancies,within8daysofthesendingofthedismissalletters.

At least 10 redundancies over 30 daysHereagain, theprocedurewillvary in functionofthesizeofthecompany.

In companies employing 50 employees or moreAnewsystemofcollectiveredundanciesappliesasaresultofthelawof14June2013onthesecurityofemployment(“loide lasécurisationde l’emploi”).Assuch,incompaniesofmorethan50employeesdismissing at least 10 employees, the employershouldundertakethefollowingsteps:

i. establish a “job Preservation Plan” (“PSE”)

The PSE should provide concrete, accurate anddetailedmeasuresand,notably,anyalternativetoredundancysuchasthereductionofworkingtime,redeploymentopportunitiesortraining. TheemployermaythenformalisethePSEby:

•entering into an agreement with the relevantunions;or

•where this is not possible, make a unilateraldecision.

Inboth cases, theplanmustbeapprovedby theLabourAdministration.

ii. consult the worKers rePresentatives and Provide information

TheemployershouldmeetwiththeWorksCouncilto announce the proposed plan and inform it inwritingofthereasonsfortherestructuringprojectandofthenumberandthecategoryofworkerstobe made redundant.

Theconsultationprocedureisnowlimitedto:

•2monthswherethenumberofredundancies islessthan100employees;

•3 months if the number of redundancies isbetween100and250employees;and

•4monthsifthenumberofredundanciesisabove250employees.

iii. seeK the aPProval of the labour administration

The agreement or unilateral decision on the PSEshouldbeapprovedbytheLabourAdministration.

Time limits are imposed on the approval of theLabourAdministration:

•15dayswhereanagreementhasbeenreached;and

•21dayswhereaunilateraldecisionwasmade.

In the absence of any response, approval by theLabourAdministrationisdeemedtobegiven.

iv. notify affected emPloyees

Once thePSEhasbeenauthorised, theemployershouldmakeeveryefforttofindemployeesfacingredundancy another position within the samecompany or group, worldwide. If the internalredeploymentisnotpossible,theemployershouldgiveeachoftheaffectedemployeesnoticeofhis/herdismissalandindicateineachletterthereasonfor the redundancy.

It is important to note that there is a specificprocedure for the dismissal of “protectedemployees”, including staff representatives, tradeunion representatives, candidates to professionalelections, and former staff representatives.Regardless of the type of procedure under way(forpersonaloreconomicgrounds),theemployershould, in most cases, inform and consult theWorksCouncil(whereoneexists)andrequestthepriorauthorisationoftheLabourInspectorfortheproposeddismissal.

Companies employing less than 50 employeesTheemployershouldconsulttheworkersdelegatesontheprojectafterhavingprovidedaneconomicnote detailing in particular the economicmotive,as well as the measures to be implemented topreventor limit thenumberof redundanciesandtofacilitatetheredeploymentofemployeesmaderedundant.

Workersrepresentativesholdatleasttwomeetingsseparatedbyaperiodthatcannotexceed14days.



As the case may be, the employees should beinformedoftheirrighttobenefitfromtheCSPatthe end of the secondmeetingwith theworkersrepresentatives.

3. individual dismissalsOnce an employer believes that there is a validgroundfordismissal,itshouldsendalettergivingthe employee five working days’ notice of ameeting. This letter should set out the time andplaceofthemeetingandtheemployee’srighttobeaccompaniedbyafellowemployeeorathirdparty.

Duringthemeeting,theemployershouldstatewhyitintendstodismisstheemployeeandtakenoteoftheemployee’sexplanationsifthedismissalisbasedontheemployee’sperformanceormisconduct.

The employer must notify the employee of itsdecision and, if appropriate, specify the groundsfordismissalinaletterdeliveredbyregisteredpost.

Theemployeemayrequestadditionalinformationon their dismissal within 15 days. The employeemay dispute the grounds for dismissal before aLabour Court.

If the contemplated dismissals are based oneconomicgrounds,theemployershouldelectwhichemployeestomakeredundantbyconsidering:

•the number of the employees’ dependants(especiallyforsingleparents);

•theemployees’lengthofservice;•potential difficulties that the employees mayfaceinfindingnewemployment(suchasageordisability);and

•theemployees’professionalskills.

Theemployershouldalsomakeeveryefforttofindemployees facing redundancy another positionwithinthesamecompanyorgroup,worldwide. Itshould also ensure that employees can adapt tothechangesintheirjobpositionbywayoftrainingprograms. Non-compliance with these rules mayrendertheredundancyunfair.TheemployershouldinformtheLabourAdministrationofitsdecisiontomaketheemployeeredundantwithin8daysoftheformalnoticeofdismissal.

A. IS SEVERANCE PAY REquIRED?

The employee made redundant will receive adismissal indemnity calculated based on the employee’syearsofservice,aswellasanyaccruedanduntakenpaidvacation.

4. seParation agreements

A. IS A SEPARATION AgREEMENT REquIRED OR CONSIDERED BEST PRACTICE?

The legislator imposes that a separationagreement,other thanadismissalor resignation,should be done through a specific procedurecalled the “rupture conventionnelle” (mutuallyagreed termination), which is subject to specificregulationsandconditions.

Hence, the “rupture conventionnelle” is the onlymethod to terminateanemploymentcontractbymutual agreement.

Theemployeewhosignsaconventionalbreakwithhis employer receives a termination indemnity,which cannot be less than the dismissal indemnity theemployeeisentitledtohadhebeendismissed.

A specific homologation or approval procedureapplies to the “rupture conventionnelle”. Oncesigned,theemployeeaswellastheemployerhasa right of withdrawal of 15 calendar days, afterwhicheitherpartywillsendtheformtotheLabourinspector for homologation or authorisation.The Labour Inspector will have 15 business daysfromthe receptionof the formtohomologateorauthorise.Intheabsenceofresponse,theformisdeemed homologated or authorised.

Thismethodofseparationwillallowtheemployeeto be entitled to unemployment benefits (if theymeetgeneralallocationconditions).




B. whAT ARE ThE STANDARD PROVISIONS Of A SEPARATION AgREEMENT?

AspecificgovernmentalformcalledaCerfashouldbe filled out, either by hand or online. The formrequestsbasicinformationontheparties,andwillrequirethefollowingprovisions:

•date of the meetings between employer andemployeeandwhethertheywereassistedduringthesemeetings,

•termination indemnity amount (which cannotbe less than the dismissal indemnity that the employee would have received in case ofdismissal),

•dateofsignatureoftheform,•dateofprojectedendoftheworkcontract(which

cannot be earlier than the day following the authorisationbythelabourinspector).

C. DOES ThE AgE Of ThE EMPLOYEE MAkE A DIffERENCE?

The age of the employeemay affect the amountof the specific termination indemnity, as certaincollective bargaining agreements provide forspecific additional indemnities depending on theemployee’sage.

D. ARE ThERE ADDITIONAL PROVISIONS TO CONSIDER?

Additional provisions may be considered andindicateddirectlyontheform,suchaswaivingofnon-competeclauses.

5. remedies for emPloyee seeKing to challenge wrongful terminationWhenseekingremedies,theemployeemayrequestbeforetheLabourCourts:

•thenullityofthedismissal(onlypossiblewhereatextprovidesforanullity,suchasharassment

ordiscrimination):asappropriate,reinstatementwithin the company or compensation of unfairdismissal;

•damages for unfair dismissal (e.g. insufficienteconomic grounds or insufficient redeploymentefforts in a redundancy, or gross misconductnotdemonstrated): thesedamagesarenowsetout in a binding grid containing minimum and maximum amounts, based on the employee’slength of service.

•damagesforirregularityofthedismissal(i.e.thedismissalprocedurewasnotcorrectlyfollowed):damages equal to a 1-month salary maximumin the event that the dismissal is considered as grounded.

•damages for any additional demonstratedprejudice.

Please note that when entering into a “ruptureconventionnelle”, the remedies are limited.The employee may only challenge the mutuallyagreed termination in Courtwithin a year of thehomologation or authorisation and only on thegrounds that he did not consent to signing the agreement.

6. whistleblower laws Thenew “Sapin II Law” fully named the “LawonTransparency,theFightagainstCorruption,andfortheModernisationofEconomicLife”putsinplacenew rules for whistleblowing in France.

The Sapin II expands extra-territorial reach forFrench prosecutors. The law applies fully tocorruption by French companies overseas andforeigncompanieswhohaveapresenceinFrance.

It creates new obligations for companies to takeanactiveroleinpreventingcorruption.Companieswith over 500 employees and/or an annualturnoverinexcessofEUR100mmustputinplaceaframeworktoallowforaccountability.

The law puts in place eightmandatorymeasuresfor a corruption prevention program. So far,these include a code of conduct to be integrated into the internal regulations of the company; aninternal whistleblowing mechanism; ongoingrisk assessments; due diligence regarding clients,suppliersandintermediaries;internalandexternal



controls;training;arosterofdisciplinarysanctions;andaninternalauditoftheprogram.

The law creates a new national anti-corruptionagency called Agence Française Anticorruption(AFA). The law requires all companieswithmorethan 50 employees to establish a whistleblowermechanism and provide protection againstretaliation guaranteeing confidentiality. ThesystemisdifferentfromitsUKandUScounterpartsand only applies to disinterested parties.Whistleblowers receive immunity from criminal prosecution. Whistleblowers must first use theinternal whistleblowing channels before blowing thewhistletothepublicauthoritiesandthepress.

ix. restrictive covenants 1. definition of restrictive covenantsPost-termination restrictive covenants are fairlycommon in French employment contracts,especiallyforsenioremployeesorthosewithaccesstoconfidential information, senior responsibilitiesorcontactwiththeclientele.Inprinciple,restrictivecovenantsmust be justified by the nature of theduties tobeperformedandproportionate to theaimthatispursued.

2. tyPes of restrictive covenants

A. NON-COMPETE CLAuSES

A non-compete clause prohibits an employeefrom competing with his former employer afterthe termination of his contract. Under Frenchemploymentlaw,thevalidityconditionsofanon-compete clause were defined by case law. Theclausemust:

•beessential topreservethe legitimate interestsofthecompany;

•beoflimitedduration;•begeographicallylimited;•take into account the specific features of theemployee’sposition;

•provide a financial compensation for theemployeeaftertheterminationofthecontract.

By reference to case law and CBAs, 30% to 50%of gross monthly remuneration is likely to bereasonable compensation for such restrictions.The compensation should be paid regardless ofthegrounds for termination (i.e. even in casesofdismissal).

B. NON-SOLICITATION Of CuSTOMERS

According to the article 1134 of the French CivilCode, an employee owes a duty of loyalty to hisemployer until the expiry of his employmentcontractandduringanysuspensionofit.

Aftertheterminationofhiscontract,theemployeerecovershisfreedomtoworkbutisstillsubjecttoaprohibitionofunfaircompetitionwithhisformeremployer. For example, case law disapproves ofcustomerpoachingthroughdenigration.

TheFrenchSupremecourthasruledthatthis isadistinct obligation from the non-compete clauseandmustbefinanciallycompensatedaswell.

C. NON-SOLICITATION Of EMPLOYEES

A clause of non-solicitation of employees usuallyprohibitsemployersfromrecruitingacompetitor’sorsupplier’semployees.

It could also refer to the interdiction for anemployeetorecruithisformercolleaguesaftertheterminationofhisemploymentcontract.

Although a non-solicitation clause concludedbetweentwocompaniesisdistinguishedfromthenon-competeclausebetweenthecompanyanditsemployee,itneverthelessresultsinalimitationoftheemployee’s freedomtowork,muchasanon-competeclause.

The French Supreme Court concluded that thisrestriction to a fundamental freedom had to becompensated based on the harm incurred (Cass.soc.2March2011,n°09-40.547).




3. enforcement of restrictive COVENANTS—PROCESS and remediesUnder French law, restrictive covenants can beenforced in different ways depending on thesituation:

•iftheemployeebreachestherestrictivecovenant,theformeremployercanissueaclaimbeforetheLabourcourt inordertoobtainaninjunctiontostoptheemployeecarryingouttheactivity.Theformeremployermayalsoclaimfordamagesforthe loss sustained according to Article 1184 oftheCivilCode. Insteadofclaimingfordamages,the employer may request the applicationof a penalty clause, if one is contained in theemploymentcontract.

•iftheemployerbreachestherestrictivecovenantoriftheclauseisvoid,theemployeemayclaimfordamagesifhehasobservedtheprovisionsofthe clause.

•if an employer knowingly hires an employeesubject to a non-compete clause, the formeremployerhasgrounds forclaiming fordamagesagainst it.

4. use and limitations of garden leave The notion of “Garden leave” as such does notexist under French law. Upon termination ofemployment, the employer may release theemployee fromworking during all or part of thenoticeperiodandpayhimanindemnityinlieuofnotice, or alternatively require the employee toworkuntiltheendofthenoticeperiod.

Iftheemployeeexpresslyrequeststobereleasedfrom his obligation to work during the noticeperiod,and if theemployeragreesto it, thentheemployerisnotrequiredtopaytheemployeeandtheemploymentcontractmaybeterminatedupontheemployeeeffectivelyleavingthecompany.

TheFrenchSupremeCourtruledthattheemployee,who is not subject to a non-compete clause andwhoisonGardenleave,mayworkwithacompetingcompanyduringhisnoticeperiod(Cass.Soc.,6May2015,n°14-11.001).


x. transfer of undertaKings 1. emPloyees’ rights in case of a transfer of undertaKingscoPe of the automatic transferIn France, an employee cannot object to atransferofundertakingasthetransferisoperatedautomatically. A refusal could constitute groundsfordismissalfordisciplinaryreasons.Theautomatictransferconcernsanykindofemploymentcontract(fixed-term contracts, trial period contracts,suspended contracts for illness, etc.). Employeeswho enjoy a protected status (e.g. employeerepresentatives) will also see their contractautomaticallytransferred,withtheirrepresentativerole intact; however, when the transfer concernsonlypartofabusiness(apartialactivitytransfer),their transfer should be authorised by the Labour Inspector.

The contracts will be transferred in theirtotality (seniority, remuneration, position,non- competition, etc.), as well as unilateralcommitments and practices, such as payment ofa 13thmonthpremium. The applicable collectivebargainingagreementwillcontinuetoapply foramaximumperiodof15months, in theevent thatthecompanytowhichtheemployeeistransferredappliesadifferentcollectivebargainingagreement.

emPloyees’ benefits and Pension rightsEmployees will continue to benefit from anyexisting profit sharing agreement unless thechange in legal statusof theemployermakes theimplementation impossible for the transferee. Inthatevent,opennegotiationsshouldbeconductedingoodfaithtoreachaprofitsharingagreement,withanobligationtoreachanagreement(articlesL.3313-4andL.3323-8oftheFrenchLabourCode).

Regarding pension rights, the transfer will havenoimpactonthesocialsecuritysystem.However,the transfer of undertaking could require aharmonisation of the complementary system(managed by AGIRC/ARRCO pension funds).The rules of harmonisation depend on how theundertakingistransferred(merger,sale,etc.).

information ProcedureTo date, there is no legal requirement in Franceto inform each employee before the transfer,but there is a legal requirement to inform andconsult the Works Council. However, in practice,employees commonly receive a brief letteradvisingofthechangeofemployer,inanattempttoachieveaseamlesstransitionandtobuildunitywith thenewentity. It isnoteworthy that certainbargaining agreements may require informingtransferred employees. Hence, exceptwhere thisis a requirement under a collective bargainingagreement, there is no legal sanction if thetransferredemployeesarenotinformed.

*TherelevantEUDirectiverequiresemployerstonotifytheemployeesofthetransferpriortotheirtransferwhentherearenoworkers’representatives.However,thishasnotbeentransposedintoFrenchlaw.Hence,nolegalsanctionexistsifthisisnotdone(Cass. Soc. 18 November 2009, n° 08 43397 and08-43398). In July 2013, the French Governmentdiscussed,butdidnotpass,abillrequiringthattheemployeebeinformedofhistransfer.

2. requirements for Predecessor and successor PartiesTheHamonLawdated31July2014providedthat,whereasmallcompanyistobesold,theemployer




sellinghisbusinessshouldinformtheworkforcesoastoallowemployeestomakeapurchaseoffer.

A decree dated 28 December 2015, taken inapplicationoftheMacronLawdated6August2015,easedtheseprovisions inparticular regarding thesanctionincaseoffailuretorespectthelaw.Nowtheemployerwhofailstorespectthisinformationobligation risksafineofup to2%of theamountof the sale. The successor has the obligation tomaintainthetransferredemployeesworkcontractandworkingrelationship(i.e.companyagreements,companybenefits,etc.).Anymodificationwillentailthe agreement of the employee or a negotiationwith the employee’s representatives, as the casemay be.


xi. trade unions and emPloyers associations 1. brief descriPtion of emPloyees’ and emPloyers’ associations The French trade unionmovement is one of theweakestinEuropeintermsofheadcount.Only8%ofemployeesaremembersofatradeunion.

Since a Law dated 20 August 2008, all the tradeunions (at the company, at the branch and atthe national levels) have to demonstrate theirrepresentativenessbycomplyingwithnewcriteria.Inparticularaminimumpercentageofvotesatthelast professional elections (10%at the company’slevel,8%atthebranchandnationallevels).

Currently, the representative trade unions atnational and interbranch level are theCGT, CFDT,CGT-FO,CFTCandtheCFE-CGC(i.e.thetradeuniondedicatedtomanagersandexecutives).

Thelargestemployers’federationsinFrancearetheMEDEF (“Movement of the French Companies”),which totals more than 750,000 member firmsandtheCGPME(“Frenchsmallandmediumsizedemployers’ organisation”), which representsthe interests of 1,675,000 SMEs, registered inFrance.

2. rights and imPortance of trade unionsAccordingtoArticleL.2131-1oftheFrenchLabourCode,theexclusivepurposeofatradeunionistoprotecttheprofessionalinterestsofitsmembers.

Themostimportantprerogativeoftradeunionsisthe role they have in negotiating and concludingcollective agreements with the employers’organisations. It used to be amonopoly, but theMacronreformintroducedotherwaystonegotiatecollectiveagreements.

This exclusive right explains the paradox ofthe French industrial relations system: a lowunionisation ratearound8%andaveryhigh rateof collective bargaining coverage, close to 98%of employees due to the extension’s mechanismof collective agreements and compulsorynegotiations.

3. tyPes of rePresentationFrenchemploymentlawprovidesthat,incompanieswithatleast50employees,tradeunions,whicharerepresentative within the company, may appointunion representatives (“délégués syndicaux”)amongtheemployeesofthecompanyinordertorepresentthembeforetheheadofthecompanyorestablishment.

A trade unionmay also be represented,within acompany,byaunionsection(“sectionsyndicale”),which gathers the members of the same trade union andrepresents itsmaterialandmoral interestsatacompanylevel.Inparticular,theunionsectionisentitledtocollect,onthecompany’spremises,thefinancialcontributionsmadebytheemployeestotheunionanddistributeitspublicationsandleafletsonthecompany’spremisesatthebeginningorendofworkinghours.



A. NuMBER Of REPRESENTATIVES

Thenumberofunionrepresentativesatradeunioncanappointwithinthesamecompanyisbasedonthenumberofcompany’semployees.

ArticleR.2143-2ofFrenchtheLabourCodeprovidesthat thenumberofunionrepresentativesa tradeunion can appoint varies from 1, for a companywithanumberofemployeesbetween50and999,to5,foracompanywithatleast9,999employees.

A collective agreement regularly concludedbetween the representative trade unions in thecompanyandtheemployercanmodifythesetermsandconditions.

B. APPOINTMENT Of REPRESENTATIVES

Inordertobeappointedasunionrepresentative,anemployeemustbeatleast18yearsold,mustbeemployedbythecompanyfor,inprinciple,atleastoneyear,andmustbeinfullpossessionofhiscivilrights.

Article L.2143-3 of the Labour Code requires theunion representative to be appointed among thecandidates in the last professional elections whoobtainedaminimumof10%ofthevotesatthefirstround.

The tradeunionmustnotify theemployerof theappointment, by registered letter with returnreceiptrequestedorhand-delivered letteragainstasignedrelease.Acopyofthelettermustalsobesent by the trade union to the Labour Inspector,andtheappointmentmustbepostedonthetradeunionnoticeboards.

Theemployercannotinterfereinthedesignationofaunionrepresentative,butmaychallengeitbeforetheFirstDegreeCivilCourt(“Tribunald’Instance”),withinamaximumperiodof15daysfollowingthedateofreceptionoftheappointmentlettersentbythe trade union.

4. tasKs and obligations of rePresentativesTheunionrepresentativerepresentsitstradeunionvis-à-vis theemployer,andmaypresentclaimstotheemployerinviewofimprovingtheemployees’workingconditions(e.g.,salaryincreases,additionaldaysofvacation,time-off,etc.).

Toperformtheirduties,unionrepresentativesareauthorisedtocirculatefreelywithinthecompany’spremises.Theyalsobenefit frompaidtime-off toperformtheirmissionasemployeerepresentatives(10 hours per month in companies employingfrom50to150employees,15hoursincompaniesemploying from 151 to 499 employees, and 20hours in companies employing more than 500employees),which are granted in addition to theunion section’s time-off hours and which can beexceeded inexceptional circumstances (suchas astrike).

The most important prerogative of trade unionrepresentatives is the monopoly they have innegotiating and concluding in-house collectiveagreements with the employer. In principle,an in-house collective agreement cannot bevalidly concluded without being signed by union representatives (Article L. 2232-16 of the FrenchLabour Code), even where the majority of thecompany’semployeesfavoursuchanagreement.

5. emPloyees’ rePresentation in managementIn principle, managers and executives have theopportunitytojointhetradeunionoftheirchoice.

However, theCFE-CGC(TheFrenchConfederationofManagementandtheGeneralConfederationofExecutives),whichisoneofthefivemajorFrenchtrade union confederations, gathers 140,000members and organises unions specifically forprofessional employees in management orexecutivepositions.




If need be, the CFE-CGC is considered asrepresentative only for executive employees andmanagers. Consequently, the CFE-CGC is entitledtonegotiateacollectiveagreementthatcoversallcategoriesofstaffbutcannotsignitonitsown.

6. other tyPes of emPloyee rePresentative bodies The significant labour and employment lawreform ushered in by the Macron government has completely overhauled the system of employeerepresentative bodies. Below is the current,survivingsituationthatwillentirelyceasetoexistby January 1, 2020 at the latest. The worker’sdelegates, works council, and Health and SafetyCommitteewillbereplacedbyandmergedintotheCSE.

Currently,othertypesofemployeerepresentativebodiesinFranceinclude:

worKers’ delegatesInanycompanyemployingatleast11employees,representatives’electionsshouldbeorganised.Thenumber of delegates to elect will vary according to thecompany’sheadcount(theirnumbervaryfrom1ormore)andtheyareelectedfor4years.

Thedelegates’ responsibilities include individuallyrepresenting the employees and their complaintstotheemployer.

Inthatrespect,theworkersdelegateshavespecificmeans,notably:

•hoursofdelegationandtravel(10hoursamonthif the companyhas less than50employees, 15hours a month if the company has at least 50employees), which are considered and paid asworkingtime;

•specificofficeandpostingboard;•meetings with the employer (at least one amonth), where questions and answers arerecorded in a special register, available to allemployeesandthelabourinspection.

worKs councilThe members of the Works Council are electedin companies of at least 50 employees. These

representatives are elected for 4 years, alongwith the staff representatives. The number ofrepresentatives here again depends on thecompany’sheadcount(theirnumbervariesfrom3to15).

TheWorksCouncilensuresthecollectivevoiceofemployees.Itallowstheinclusionoftheirinterestsin decisions concerning life in the company(management and economic and financialdevelopments, work organisation, training,productiontechniques).

Itexaminesformulaoronrequestoftheemployer,anyproposallikelytoimprove:

•workingconditions,employmentandvocationaltrainingforemployees,

•livingconditionsinthecompany,•and the conditions under which they benefitfromgroupbenefitsadditionalsocialprotection.

The Works Council is mandatorily consulted oncertainissues,andthefollowingthreemainthemesmustbeaddressedatleastonceayear:

•strategicorientationofthecompany,•financialandeconomicsituationofthecompany,•social policy of the company, working andemploymentconditions.

The Works Council is consulted or informedpromptlyofanyplansfor:

•organisation and running of the business(business organisation, introduction of newtechnologies, restructuring and downsising,changesineconomicorlegalorganisationofthecompany,takeoverbid)

•working conditions (for any specific problemarising from work organisation, technology,conditions of employment, the organisation ofworkingtime,skillsandformsofremuneration)

•asafeguardprocedure,receivershiporliquidation.

The Works Council also has a right to alert ofeconomicandsocialmatterswithinthecompany.

The Works Council also provides, controls orparticipates in themanagement of all social andcultural activities, which are established at thebusinesstoemployees,theirfamiliesandtrainees.These social and cultural activities may include



activities aimed at improving the conditionsof well-being, activities related to leisure andsports, professional or educational institutions oforder attached to the company, a health serviceestablishedtoworkinthecompany,etc.

health and safety committeeIncompaniesofatleast50employees,ahealthandsafetycommittee(CHSCT)mustbeimplemented.Itiscomposedofappointedemployerandemployeerepresentatives.Thenumbervariesaccordingtothecompany’s headcount (which varies from3 to 9).Toaccomplishtheirmission,theseofficialsreceivedelegation hours in function of the company’sheadcount(between2and20hoursamonth).

The CHSCT contributes to the prevention andprotectionof thehealthand safetyofemployeesin the company, participates in the improvementof their working conditions and ensures theemployer’scompliancewith legalobligations.TheemployershouldconsultandinformtheCHSCTonanumberoftopics.Itisconsultedinthefollowingsituations:

•before major transformation of workstationsfrom the change of tooling, a change in theproductortheworkorganisation,

•before changing speeds and productivityconditions,

•onanymajorprojectofintroductionandduringthe introduction of new technologies and theirimpactonthehealthandsafetyofemployees,

•on the adaptation plan established in caseof implementation of significant and rapidtechnologicalchange,

•onmeasurestakentofacilitatethedevelopment,deliveryormaintenanceworkofinjuredworkers,disabledpeopleanddisabledworkers

•onthedocumentsrelatingtoitsmission,includingthecompany’sinternalregulations.

The employer at least once a year informs theCHSCT:

•withawrittenreporttakingstockofthegeneralsituationofhealth,safetyandworkingconditionsinthecompany.thereportpresentstheactivitiescarriedoutduringthepastyear,

•through an annual program of preventionof occupational risks and improve workingconditions.

The employer must also make available to theCHSCT:

•the single document of occupational riskassessment(DUERP),

•reports and results of occupational medicalstudies on the business.

TheCHSCTmaycalluponaregisteredexpert,whichfees are borne by the employer, in the followingsituations:

•whenaseriousrisk,provenornotbyanaccidentat work, occupational or professional naturediseaseisfoundinthecompany,

•incaseofmajorprojectmodifyingtheconditionsofhealthandsafetyorworkingconditions.

The employer may oppose to having an expertappointed,incertaincircumstances.

cseWith the Macron reform, by January 1, 2020,all companies with at least 11 employees willhave to put in place a CSE. The Macron Reformhas significantly simplified staff representationin companies by merging the former three staffrepresentativebodiesintoone.TheWorksCouncil,StaffDelegates,andHealthandSafetyCommitteeare now combined into the Social and EconomicCommittee: the CSE. Note that it will also bepossible, subject to the existence of a collectiveagreement, instead of a CSE, to implement aConseil d’entreprise. This body would basicallyhavethesameprerogativesastheCSEbutwould,inaddition,beabletoenterintoandrevisecollectiveagreements,insteadoftradeUniondelegatesthatwouldnolongerexist.

timeframeThe minimum threshold for mandatoryimplementation iswhenthecompanyemploysatleast11employeesfor12consecutivemonths.

Inprinciple,theCSEissetupattheendofthecurrentmandateoftheelectedstaffrepresentatives,oratthe renewal of one of these bodies.

Inanycase,theverylatestfortheimplementationoftheCSEis31December2019.



Thebodyhasthesameconfiguration,regardlessofthesizeofthecompany. Itmust includeahealth,safety and working conditions commission incompaniesandseparateestablishmentsthathaveatleast300employees.

ThenumberofseatstotheCSEvaryinproportionto the staff headcount. It ranges from 1representativeforcompanieswith11employeesto35representativesforcompanieswithover10,000employees.

cse’s resPonsibilities CSE’sresponsibilitiesincompanieswithfewerthan50employees

Therehasbeenacarry-overofmostassignmentsformerlyentrustedtotheStaffDelegates:

•They can therefore present individual claimsrelating towages, theapplicationof theLabourCode,etc.

•Theywillhavearoleinthepromotionofhealth,safety and working conditions in the company,investigationofaccidentsatworkoroccupationalillnesses.

•They can refer all complaints and observationsrelating to theapplicationof legalprovisions tothelabourinspectorate.

CSE’sresponsibilitiesincompanieswith50ormoreemployees

There has been a carry-over of the powerspreviouslyassignedtotheStaffDelegatesexplainedaboveaswellas thosepreviouslyassigned to theWorksCouncil:

•The CSE remains informed and consultedon matters concerning the organisation,management and general operation of thecompany.

The CSE remains informed and consultedperiodicallyon:

•thestrategicorientationsofthecompany,•the economic and financial situation of thecompany,

•the social policy of the company, workingconditionsandemployment.

Finally,theCSEhasprerogativesthatwereformallythoseoftheHealthandSafetyCommittee(CHSCT).


xii. emPloyee benefits 1. social securityFrenchsocialprotectionisorganisedinfourlevels:

i. Social Security, which provides the basic riskcovers “illness /maternity / disability / death”,“occupationalaccidents/occupationaldiseases”,“elderly”and“family.”Itiscomposedofvariousschemes involving the insured according to their professionalactivities,themainones:

•thegeneralscheme:itincludesworkers,students,recipientsofcertainbenefits,andresidents;

•specialschemes:theycoveremployeeswhoarenot in the general scheme (e.g. civil servants,SNCFandEDF-GDFagents...);

•the schemes for non-agricultural employees:they separately cover the artisans, merchantsormanufacturers and liberal professions to thepension insurance, the“sickness” risk is subjecttojointmanagement;

•theagriculturalscheme:itensuresthewelfareoffarmersandfarmemployees.ThissocialsecuritysystemdoesnotdependontheMinistryofSocialAffairsbutontheMinistryofAgriculture.

ii.ComplementaryplanswhichprovideadditionalcoveragetotheriskscoveredbySocialSecurity.Some are mandatory (supplementary pensionfor private sector employees) and othersoptional(mutualhealthorganisations,insurancecompanies,pensionfunds).

iii. UNEDIC (National EmploymentUnion Industryand Commerce), which administers theunemploymentinsuranceprogram.

iv. State welfare, which provides support to thepoorest.

required contributionsSocialSecurityismainlyfinancedthrough:

- SocialSecuritycontributions:•thecontributionisbasedonthebasicsalarypaid(mainly indemnities, premiums, and monetary

advantages, as well as tips, and under certainconditionsbenefitsin-kind;

•theratefixedbydecree,withaportionpaidbytheemployerandtheotherportionbytheemployee(“grosssalary”isthetotalwageswithdeductionof employer contributions; “net salary” is thegrosssalaryreducedemployeecontributions);

•the employer pays all due contributions to theadministrativebody;

•the average employer contribution can accountfor as much as 45% of the gross salary of theemployee, whereas the employee contributionmayonlycountforasmuchas20%.

- A specific tax called CSG (“Generalized SocialContribution”)

- VariousothertaxescollectedbytheSocialSecurity(e.g. “forfait social” tax; gross VAT on tobacco,pharmaceuticals,alcohol,healthproducts;taxoncompanycars,taxonlandmotorvehicles;taxonsalaries;etc.).

2. healthcare and insurancesThe French law provides for a basic minimumindemnity and protection of employees. Quiteoften,collectivebargainingagreementsprovideforadditionalprotectionorallowances.

3. required leave

A. hOLIDAYS AND ANNuAL LEAVE

holidaysEmployees are entitled to a minimum of fiveweeks’ paid holiday a year. In addition, there areapproximately ten public holidays every year.The law andCBAs grant additional paid leave foremployeeswhohave reacheda specific lengthofservice and for family related events. Autonomous executivesalsobenefitfromadditionaldaysoff.



annual leaveEveryemployeeisentitledtopaidvacationsbyhisemployer, regardless of his age, seniority or typeof contract (indefinite-term or fixed-term). Thedurationofpaidvacationsvariesaccordingtotheacquired rights (legally 2.5 days of paid vacationper month, unless more favourable collectivebargaining agreement provisions apply). Thevacationdatesaresubjecttotheagreementoftheemployer.

B. MATERNITY / PATERNITY LEAVE

Thepregnantemployeebenefitsfromamaternityleave during the period, which is around theexpected date of childbirth (there is a prenatalleaveandpostnatalleave).Itsdurationisvariable,depending on the number of unborn children oralreadyatcharge(from16to46weeks).TheSocialSecurityDailyAllowancevaries in functionof thesalary(fromEUR9.39toEUR86).

C. SICkNESS LEAVE

Where the employee is out ofwork for sickness,subject to compliance with certain formalities(notably for the employee to submit, within 48hours,thesicksliptotheSocialSecurityofficeandtheemployer)andsatisfiestherequirements,theemployee is entitled to receive a daily allowanceduringhis leave,afterathree-daywaitingperiod.Thisallowancewillbedirectlypaidtotheemployerin case of subrogation. The daily allowance paidfor sick leave is 50% of the basic daily wage (onaverage, the Social Security Daily Indemnity is ofEUR 43.40). After 30 days of sick leave, the dailyallowanceisincreasedto66.66%ofthebasicdailywage, iftheemployeehasat leastthreechildren.After 3 months, the daily allowance will be re-evaluated.

D. DISABILITY LEAVE

If an employee is recognised as ‘invalid’ (workcapacity and gain is reduced by at least 2/3 asa result of an accident or a non-occupationaldisease)theemployeecanobtainthepaymentofapensiondisabilitytocompensateforlostwages,byfillingademandbefore theCPAM (FrenchHealthInsurance).

If the accident or illness is work-related, theemployeemayreceive,undercertainconditions,apermanentdisabilitypension.

The employee should be affiliated to the SocialSecurity for at least12monthson the1stdayofthemonthduringwhichoccurredtheinterruptionofwork followed by disability, or the recognitionofdisabilitystatusresultingfrombodilyprematurewear.

Inadditiontothequalifyingaffiliationperiod,theemployee should either have contributed on asalaryat leastequal to2,030timestheminimumwage schedule during the 12 calendar monthspreceding thework interruption, or haveworkedatleast600hoursduringthe12monthsprecedingtheinterruptionofworkorrecognitionofdisabilitystatus.

Invalidsareclassifiedinto3categories,dependingontheirlevelofdisability,bythemedicalofficeroftheprimaryhealthinsurancefund(CPAM):

•1st category: invalids capable of remuneratedemployment,

•2nd category: invalids absolutely unable toperformanyoccupation,

•3rdcategory:invalidwhoisabsolutelyunabletoexercise a profession, and compelled to resortto the assistanceof anotherperson toperformordinaryactivitiesoflife.

Theamountofthedisabilitypensionreceivedwilldepend on the category the person is in, as thedeterminingofacategoryisnotdefinitiveandmayevolve.

4. PENSiONS: MANdATORY and tyPically Provided The French retirement pension system ofemployees is structured into three components;thefirsttwo,theBasicretirementpensionandtheComplementaryretirementpensionaremandatory,hence, contributions are imposed on employeesandemployers,whilethethird,Additionalpension(whenimplementedbytheemployee,itisprimarilyof savings products such as life insurance, thepopularretirementsavingsplan(PERP)or“Madelincontracts”fornon-salariedworkers)isoptional.




basic retirement PensionThe characteristic of the basic diets is that theyare extremely fragmented. They number thirty-six structured around the professional status oftheir contributors (private sector, agriculture,civil servants, independent...) or a particularoccupational category (SNCF, RATP, Ministers ofReligion ...). For employees of the private sector,the fund is the National Elderly Insurance Fund(CNAV)andthelargestpensionfund.

comPlementary retirement Pension•for employees and managers covered for theirbasicpensionofnationalpensions’fund(CNAV)or MSA (MSA), the complementary pension ismanagedbytwoentities:

•for executives, it is the General Association ofSupplementaryPensionInstitutionsofExecutives(AGIRC);

For all employees, it is the Association ofsupplementary pension schemes (ARRCO). Bothassociations formed an economic interest group:GIEAGIRC-ARRCO.AnagreementsignedinOctober2015providesforthecreationin2019ofaunifiedcomplementaryregime.

additional PensionBased on the principle of capitalisation by theemployee,whosavesforretirement,theadditionalpensionisfairlymarginalintermsofmembership.Itcanbeimplementedbyacompanyorindividually.Whenimplementedbytheemployee,itisprimarilyof savings products such as life insurance, thepopularretirementsavingsplan(PERP)or“Madelincontracts”fornon-salariedworkers.

JoëlGrangé,PartnerFlichy Grangé [email protected]+33156623000


mailto:grange%40flichy.com%20?subject=

FlichyGrangéAvocats is a leading employment andlabourlawfirminFranceandinternationally.Workingwith companies and entrepreneurs, the firm’s goalistobearealpartnerforlegalandhumanresourcesdepartments,proposingpragmaticlegalsolutionsandtaking accounting, financial or commercial aspectsintoconsideration.Itsteamofmorethan75lawyersfocus on collective negotiations, employee benefits,healthandsafety, litigation,ethicsanddiversity,andother key practice areas. Flichy Grangé Avocats hasbeenrecognisedasafirst-tierfirmbyTheLegal500andChambersEurope,andwasrecentlyawardedthefirstprizeinthe“Reorganization,SocialRestructuringandInherentLitigation”categoryatthe16thSessionoftheLawTrophiesorganizedbyLeadersLeague.

This memorandum has been provided by:

Flichy Grangé Avocats66avenued’Iéna75116Paris,FranceP+33156623000www.flichygrange.com

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