Hire and pay employees in France

Employer of Record (EOR) vs. entity

First things first: You need to decide whether you’ll use an EOR or set up your own entity to hire employees in France. 

• Legal entity in France. Setting up a legal entity from scratch usually requires registration with local authorities, selecting the right tax regime for your business, submitting a dossier to the Commercial Court, and issuing a VAT number, among numerous other steps.
• French EOR. An EOR is a third-party service that operates on the employer’s behalf handling all the legal requirements for hiring full-time French employees, like payroll, employment contracts, and benefits.  

Deciding between an EOR and your own entity depends on your company’s resources, size, and plans to scale. Here are the pros and cons of each:

Once you’ve picked an EOR, you can begin the onboarding process by collecting your employee’s information (including name, date of birth, date of hire, contact, and bank information).

Understand the steps to hiring through an EOR in France—and learn how Rippling can help you hire and onboard French employees in 90 seconds—in our guide.

Classifying French workers: employees vs. contractors

Properly categorizing workers is vital when starting the hiring process. Just like in many other countries, France has distinct classifications for employees and contractors—and misclassification can lead to substantial financial penalties and complications. 

Here are some key points outlining how French law distinguishes between employees and contractors:

Learn about how to classify your workers correctly, and stay compliant with French labor and employment laws, in our classification guide.

Work permits for French employees

Before you can move forward with the rest of the hiring process, you need to be sure your prospective employee is allowed to work in France. 

Foreign nationals who wish to work in France must declare themselves to the French Immigration and Citizenship Office (OFII) to obtain a work visa to be legally employed. Anyone planning to stay and work for more than three months also needs a residence permit. 

Additionally, in France, both the employer and the employee have to fill out paperwork for the latter to be legally authorized to work there. The employer needs to apply to the Ministry of the Interior to obtain a work permit, and the employee needs to apply to the OFII for a work visa.

Visas for skilled foreign professionals who want to legally work in France include:

• Short-stay visa. For employees who’ll be working in France for 90 days or less. These are not eligible for renewal.
• Long-stay visa. For employees taking on a permanent job? This type of visa is renewable, and it’s generally valid for one year. The employee will also need the proper resident permit to live in France.
• Temporary stay. For employees who will work a job in France that lasts more than three months but under one year. When they receive this visa, they’ll also get a temporary residence permit.
• Talent passport. The Talent Passport is a special type of French work visa that’s reserved for certain professionals and entrepreneurs whose work and ideas will directly benefit the French economy. Employees who receive the Talent Passport can bring their families, including spouses and dependents, and it doesn’t need to be renewed for four years.
• Special case work visas. France offers separate work visas for volunteers, interns, students, and professionals between the ages of 18 and 30 who are taking a working holiday.

For the full list, and details on how to apply, see our guide to work permits in France.

New hire onboarding checklist

Once you’ve ensured that your employee has the necessary legal authorization to work in France, you can get started on the onboarding process. This is an opportunity to establish a strong foundation for the employment relationship, right from the start. 

Remember, a successful onboarding experience extends beyond the employee's first day and encompasses much more than just handling payroll and benefits.

Leading up to day 1

• Complete a background check. 
• Send an offer letter (more on that in the next section).
• Prepare for tax withholdings. 
• Enroll them in benefits.
• Add them to payroll. 
• Order and configure their devices. 
• Schedule their orientation.

Day 1

• Make sure their workspace is ready. 
• Send a welcome email. 
• Give them an agenda. 
• Schedule a meeting with their onboarding mentor. 
• Give them an office tour. 

During their first 90 days

• Schedule training. 
• Assign work and help them set goals. 
• Schedule regular check-ins. 
• Seek their feedback on how to improve the experience.

For the full list of onboarding must-dos, see our guide on new hire onboarding in France.

What to include in an offer letter in France

Offer letters are an integral part of hiring (and can leave a lasting impression). Here’s a basic checklist of what to include in an offer letter—also known as an employment agreement:

• Collective bargaining agreement
• Position (job title), job description, commencement date, and trial period
• Compensation and benefits
• Salary
• Paid vacation
• Working hours
• Place of work
• Absence/sick days
• Supplementary pension and provident fund
• Termination policy
• Non-compete and non-solicit agreements
• Confidentiality agreements
• Financial guarantor
• Other legal provisions

Learn more about sending a legally compliant offer letter in France in our guide.

NDAs and confidentiality agreements in France

Non-disclosure agreements (NDAs) are usually sent as part of the employment agreement. They must include the full names of the consenting parties, a thorough definition of the information that can’t be disclosed, situations where the NDA is nullified, and provisions for maintaining confidentiality after an employee is terminated. 

French law is vague about exactly what information can be covered by an NDA. It’s best to consult a French attorney when you’re creating an NDA to make sure you’re protected and compliant with French laws. While you’re speaking with your attorney about what to include in the NDA, get their advice on when it’s best to use a non-disclosure agreement in France. Read about the different types of NDAs, and their essential components, in our introduction to NDAs in France.

Running background checks on French employees

In France, you must run a background screening before taking on a new employee. However, employers are only allowed to ask questions that pertain to the role the applicant will be taking. 

You can conduct different types of background screenings based on a new hire’s role. Here are the most common types, and a few others to consider:

Learn about the different types of background screenings you can run in our guide to background checks in France.

Paying employees in France

After weighing the options between using an EOR service or establishing your own entity, the next step is to select a suitable payroll solution. Read our step-by-step guide to running payroll for employees in France.

Next, you can take these steps: 

• Ensure employees are classified accurately.
• Gather employee information, including name, date of birth, date of hire, and contact and bank information.
• Enter the payment amount in EUR—or get written consent from the employee if you’ll be making payments in a different currency.
• Ensure compliance with legal obligations when calculating payroll deductions.
• Process payroll.

Since you’re responsible for calculating payroll deductions, you should keep the following costs in mind:

• French income tax
• Social Security contributions
• Supplemental pensions

CEG (Contribution d’Equilibre Générale)

Mandatory employee benefits in France

France has mandatory employee benefits as well as supplementary ones; it’s important to understand what’s required on your part before finalizing your offer letter. Mandatory benefits include:

Pensions. There are three types of retirement pension systems: the basic retirement pension, the complementary retirement pension, and an additional pension. Employers only contribute to the basic and complementary pensions.

Overtime. French labor law is strict about limiting employees to a 35-hour workweek. While there aren’t laws against overtime, there are regulations governing overtime pay for workers who go over the 35-hour limit.

Vacation entitlements. Congés payés is the standard type of vacation leave in France. This provides all French employees with 25 statutory vacation days annually. The other type of annual leave is known as Réduction du Temps de Travail (RTT). RTT is given to employees on a "Forfait jour" contract, in addition to congés payés. The number of RTT days varies from seven to nine year over year.

Statutory holidays. Workers in France are entitled to 11 statutory holidays per year, except for residents in the Alsace region and Moselle/Lorraine, who receive an additional two days.

Prevoyance (Life and Disability). Employers must offer a plan that covers employees in the event of a serious illness, handicap, or death. The government will cover 50% of an employee's income up to a limit of 50% of 1.8x the minimum wage, while the employer can cover up to 90 days in a 12-month timeframe.

Parental leave. The French government mostly funds parental leave programs. The duration of maternity and paternity leave is determined by the number of children the parents already have and the number of children in the pregnancy. While employers aren't required to compensate the employee, some CBAs choose to do so.

Sick leave. Full-time employees can receive sick leave only when they provide a doctor's note. The length of their sick leave and how much they'll be paid during this time depends on many factors, including tenure, their CBA, and employee "statut" within their CBA. The government and the employer are both responsible for pay during sick leave.

Meal vouchers. French law requires employers to offer a free lunch option to all employees. Accordingly, meal vouchers (or tickets restaurant) are extremely common in France. They're accepted by a variety of restaurants and grocery stores.

Healthcare benefits. All French citizens are covered under the national health insurance scheme which doesn’t necessarily cover all of their medical needs. Employers are responsible for 50% of the cost of their employee’s mutuelle, an additional private insurance many people purchase.

Read our full guide on offering benefits, from public holidays to family benefits—and learn how to go above and beyond for your French employees.

Managing remote employees’ computers and apps

The logistical aspects of shipping, configuring, and updating devices from a distance, along with replicating the process for your entire global team, can be overwhelming. 

Ensuring that employees are equipped with the necessary applications, tools, and integrations used by your company, while also maintaining control over their management, is crucial. With Rippling, you gain the following benefits:

• Swiftly establish and secure employees' accounts, guaranteeing that they have the required access and permissions.
• Access a centralized platform to set up, manage, and disable employee applications such as Google Workspace and Slack. 

For a comprehensive understanding of how to effectively set up and handle remote employee devices, refer to our guide.

Protecting company IP in France

Giving new employees access to apps and sensitive company information can put you at risk if you don’t take the proper precautions. To protect your company’s original ideas, make sure to clarify IP protections in the employee agreement. This can include who owns the IP created by the employee, who has the right to use it for commercial purposes, confidentiality agreements for trade secrets, and more. 

In France you can register the following types of IP:

Trademarks. You can register a word, symbol, or other quality that defines your company.

Patents. Once they’re granted, patents are valid for 20 years.

Designs. You can register a design for your company in France with INPI or register it as a “community design” with the European Union Intellectual Property Office.

Databases. The European Union created special protections for databases to encourage the growth of and investment in databases. Read more about intellectual property protections in our beginner’s guide to IP ownership and rights in France.

Complying with France labor laws

When it comes to global employment, there are many crucial components to manage. One of the most important aspects is ensuring you adhere to local labor laws. Thanks to strict French labor laws and collective bargaining agreements, French workers enjoy some of the strongest protections in the world.

Read about the most important regulations to keep in mind when hiring in France, including (but not limited to):

• At-will employment doesn’t exist. French labor laws only permit dismissal as a last resort.
• Trade unions are complex. While only 9% of French workers are trade union members, unions still have influence over French labor laws on the local and national levels.
• Issues with employees must be documented in writing. You’ll need evidence to prove you have just cause for termination so if there’s an issue with an employee be sure to document it in writing.

Terminating employees in France

There are strong protections for workers, and only three categories for dismissal are recognized by law: 

• Voluntary personal grounds. This includes misconduct issues the employee is directly responsible for. These can range from continuous and unreasonable absenteeism to more serious gross misconduct like harassment. 
• Involuntary personal grounds. This includes issues like the employee being unable to perform the basic duties of their position or repeatedly failing to achieve expected results.
• Economic grounds. This covers issues that have to do with the company itself, such as bankruptcy.

Collective bargaining agreements will affect both the termination period and the severance pay and package. The general notice periods French employees receive are based on their length of service:

• One month’s notice for employees who have been with the company between six months and two years
• Two months’ notice for employees who have been working with the company for more than two years
• Three months’ notice for anyone who’s in an executive-level role

Learn more about handling termination requirements in France in our full guide to terminations.

Disclaimer: Rippling and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any related activities or transactions.