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Key considerations Which issues would you most highlight to someone new to your country?
The standard principles of contract law do not apply to employees in France, as they are considered a weak party that requires protection under the law. The Labour Code and national collective bargaining agreements often impose strict rules which prevail over the terms of an employment agreement. According to the Labour Code and well-established case law, any uncertainty regarding a termination or disciplinary action will be judged to the employee’s advantage.
Over 95% of employees in France are covered by collective bargaining agreements, importantly this is regardless of whether the employer operates in a unionised environment. This means that most of the rules contained in the Labour Code are supplemented by more generous rules for employees, such as those regarding:
- minimum wage;
- paid leave;
- maternity leave;
- medical cover; and
- working time.
However, recent reforms have extended the right for employers to enter into company collective agreements which may deviate from an industry collective agreement in specific domains, such as working time.
Finally, employers should be aware that all employee documentation – whether policies, employment contracts or technical documentation – used by employees must be in French or a bilingual version.
What do you consider unique to those doing business in your country?
Unions play a key role in many aspects of French employment law.
A unique feature of doing business in France is the complexity of the rules and regulations due to cumbersome procedures and forms. Further, because France is a civil law jurisdiction, the rules are not as transparent as in a common law jurisdiction. This is noticeable when, for example, a company seeks to restructure or acquire a business in France.
Is there any general advice you would give in the employment area?
All employers – particularly large companies – should pay close attention to the role of employee representatives before making business decisions. Relationships with employee representatives (eg, works councils) must comply with the Labour Code, including information requirements, consultation obligations and working time regulations.
Emerging issues/hot topics/proposals for reform Are there any noteworthy proposals for reform in your jurisdiction?
The Work Law, known as ‘Loi travail’, which came into force in August 2016, introduced significant changes to several areas of French employment law, including:
- a new architecture of the Labour Code in the section on working time and leave of absence:
- The new provisions make the company-level agreements prevail over the national-level bargaining agreements to set the rules regarding working time. The company and national-level bargaining agreement must comply with the public order provisions;
- objective criteria to define the economic difficulties in case of economic redundancies; and
- redesigned rules regarding the validity of a collective agreement and the representation of signatories.
These provisions will come into force progressively.
New litigation rules applicable to the labour courts have also been recently implemented with a view to reduce time lines. One notable change since August 1 2016 is an employee filing a claim before the labour courts is not prevented from filing subsequent claims under the same employment contract.
Also, a draft law (Sapin Law) plans to make executive pay (including benefits) subject to shareholders’ vote at the annual meeting. No payment can be made, except fixed salary, until the shareholders approve the package.
The Sapin Law also aims to implement an internal reporting procedure for whistleblowing.
Finally, a guideline of compensation to be used by the courts for unfair dismissal is under review. If implemented, it would range from one to 22.5 months, depending on years of service, age and personal situation of the employee
What are the emerging trends in employment law in your jurisdiction?
France has reformed many areas of employment, albeit gradually.
Company-level negotiation has been boosted by extending the scope of agreements. In particular, a company referendum can now be used as an alternative to sign an agreement proposed by unions.
The government has also continued to make consultation timelines more predictable by recently extending fixed-term consultation periods to the health and safety committee.
Employer’s strict liability regarding harassment has been relaxed if employers can prove that they have implemented preventive measures and took immediate actions to stop harassment.
With the backlog of cases that most courts are experiencing in France, individual employment litigations can take up to two years to be listed. Efforts are being deployed to fast track proceedings in several ways, including prioritising simpler matters and limiting the possibility to adjourn hearings. More complex cases will be heard by a professional judge working alongside the laymen judges elected to the Employment Tribunal.
The employment relationship
Country specific laws What laws and regulations govern the employment relationship?
The employment relationship is governed by different levels of legislation, starting from the bottom up:
- employment agreements;
- company-level agreements;
- national collective bargaining agreements which apply to all employers operating in the relevant industry;
- legislation, including the Labour Code, which compiles the statutes; and
- the Constitution and higher rules (eg, EU treaties or law).
French employment law operates under two main principles. The first is that the set of rules of the highest hierarchical level will prevail over the lower ones. The second is that employees should benefit from the most advantageous rule.
These principles have been shaken by the recent Loi Travail. This law has introduced a new architecture in the Labour Code to raise company-level agreements over national-level bargaining agreements regarding working time rules. A committee has been created to study the extent of this new architecture to the remaining provisions of the Labour Code.
Who do these cover, including categories of worker?
These laws and regulations apply to all employees working under employment agreements which are subject to French law, even employees at the executive level. In principle, independent contractors and company officers and directors are not subject to these laws and regulations; however, these categories of workers frequently claim that they are deemed employees and enjoy the same protection.
Misclassification Are there specific rules regarding employee/contractor classification?
There are different types of contractor under French law. Due to the EU directive on agency workers, employees and agency workers enjoy similar levels of protection with regard to pay and benefits. Classification issues raised by agency workers relate to whether their contract is temporary or whether it complies with the strict regulations. By contrast, contractors (eg, independent consultants or self-employed individuals) can claim that they are employees if they can prove that their duties, the instructions that they receive and the way in which their work is performed amounts to an employment agreement. As in many other jurisdictions, this classification depends on many factors which are frequently adjusted by case law.
Contracts Must an employment contract be in writing?
Indefinite employment agreements need not be in writing, subject to any applicable collective bargaining agreement. However, it is in the interest of employers and standard practice to enter into employment agreements.
Fixed-term or part-time employment agreement must be in writing.
Are any terms implied into employment contracts?
Some terms are implied, such as the duty of loyalty and confidentiality.
In addition, the Labour Code supplements employment agreements, introducing, for example, mandatory paid leave entitlements and rest periods.
Are mandatory arbitration/dispute resolution agreements enforceable?
Under French law, mandatory arbitration/dispute resolution agreements are unenforceable. However, there is a mandatory conciliation phase before an employment litigation matter goes to a judgment hearing.
How can employers make changes to existing employment agreements?
As a rule, any change to an employment agreement requires the employee’s consent, unless it is considered to be an unessential term of the agreement or part of the employer’s right to variations. Changes relating to pay and benefits are usually deemed to be contractual and require consent.
When a change is made for economic reasons, employers must follow the specific process set out under French law. Employers must provide formal notice and wording by registered letter at least 30 days before the proposed contractual change. If the employee refuses the change, a termination procedure for economic reasons may be carried out. If the employee remains silent, he or she will be deemed to have accepted the change.
Subject to concluding a collective agreement with the representative union delegates, when a company faces situations such as a change of business environment, the law now gives the opportunity to employers to reduce salary or increase working time (with no extra pay) during a period of up to five years. In practice, such agreements may remain the exception as it will be necessary to get the unions on board.
Certain contractual changes that affect multiple employees may be subject to prior consultation with the relevant employee representatives.
Foreign workers Is a distinction drawn between local and foreign workers?
A distinction should be made between employees working under French employment agreements and those working under foreign employment agreements, rather than a distinction based on nationality. Employees on international assignments are subject to the core mandatory rules (eg, health and safety), rather than the entire Labour Code. When a foreign co-contractor seconds an employee to France, the instructing party or project owner must verify that the labour authority has been duly notified. Failure to do this may trigger a €2,000 fine per seconded worker (capped at €500,000 per company). Filing obligations are broad and include workers such as subcontractors and agency workers.
All employees working in France must have the right to work, which may entail obtaining a visa and a work permit, even if the employer is based outside France. Employees from the European Economic Area (including French nationals) are generally exempt from such formalities.
Advertising What are the requirements relating to advertising positions?
When advertising positions, employers cannot request an employee of a certain age or include any discriminatory conditions (eg, based on sex or, physical appearance or another protected category). Job ads must be in French.
What can employers do with regard to background checks and inquiries in relation to the following:
(a) Criminal records?
Criminal record checks are permitted for specific positions (eg, security staff, people working with vulnerable individuals or regulated roles in the financial sector). Only the employee can obtain his or her criminal reports from the authorities.
(b) Medical history?
An employee’s medical history cannot be checked unless it is relevant to the position that he or she holds, subject to privacy rules. However, a medical examination must be carried out by an occupational doctor on hire and if an employee has been on sick leave for more than 30 days. Occupational doctors also monitor work-related accidents and diseases, including work-related stress.
(c) Drug screening?
Drug screenings may be allowed if they are justified by the nature of the employee’s duties and where there are particular risks.
(d) Credit checks?
French law prohibits credit checks for hiring purposes.
(e) Immigration status?
Employers must ensure that applicants are allowed to work in France and may ask them for proof of identity. However, employers cannot ask an applicant when or how he or she obtained French citizenship.
(f) Social media?
This type of background check is not specifically regulated. However, due to data privacy regulations, any check must be proportionate, justified by the nature of the employee’s duties and use reliable sources of information.
Transferring data outside France and Europe will be restricted, as is the purpose of processing and how long data can be held. The EU General Data Protection Regulation that comes into effect in May 2018 will apply in France to recruitment.
Wages and working time
Pay Is there a national minimum wage and, if so, what is it?
The national minimum wage in France is known as the SMIC and is adjusted every year. For 2016 the SMIC is €9.67 per hour. National collective bargaining agreements may provide for a higher minimum wage.
Are there restrictions on working hours?
French law and the EU Working Time Directive contain many restrictions on working hours. Working time is defined by day, week or year.
Hours and overtime What are the requirements for meal and rest breaks?
By statute, employees are entitled to a 20-minute break after every six hours of work. Meal and rest breaks are usually unpaid, unless otherwise agreed or where the employee’s duties require him or her to remain on the company’s premises during such breaks.
How should overtime be calculated?
The standard working week in France is 35 hours; however, this is not a maximum weekly working time. Employees working more than 35 hours per week are entitled to overtime unless otherwise agreed under the employment agreement and the applicable collective bargaining agreement. The legal rate can take overtime payment up to 150%, but it can be limited to 110% by a company collective agreement, even if the industry level collective agreement’s rate is higher. The employer and employee should keep an accurate record of the employee’s working time.
What exemptions are there from overtime?
Senior executives who are part of management are not subject to overtime. Employees who have agreed to alternative working times (eg, a daily flat working time rate) are not subject to overtime, but will benefit from additional rest breaks. Part-time employees are subject to their own set of rules.
Effective working time can be calculated over a period of three years, subject to signing a company level agreement.
Is there a minimum paid holiday entitlement?
Employees are entitled to five weeks of annual leave per year in addition to bank holidays. Collective bargaining agreements frequently provide for additional paid leave. There is also additional leave for personal and family events.
What are the rules applicable to final pay and deductions from wages?
On termination, an employer must pay an employee his or her final salary and any accrued but untaken paid leave.
Deduction from wages are restricted under French law. Even where deductions from wages are lawful pursuant to a court order or mistake, they are capped so that the employee still receives the minimum living salary, calculated based on the household earning and the number of dependents.
Record keeping What payroll and payment records must be maintained?
Employers must provide employees with a payslip each month. On termination, a final statement of all accounts must be provided to the employee. Additional documents (eg, work certificates and unemployment forms, benefits and pension information if the employment does not end due to resignation or gross misconduct) must also be maintained.
Discrimination, harassment & family leave
What is the position in relation to:
Protected categories (a) Age?
Discrimination based on age is prohibited under French law.
Discrimination based on race is prohibited under French law.
Discrimination based on disability is prohibited under French law.
Discrimination based on gender is prohibited under French law.
(e) Sexual orientation?
Discrimination based on sexual orientation is prohibited under French law.
Discrimination based on religion is prohibited under French law.
Discrimination based on medical needs is prohibited under French law.
In addition to the categories listed above, the following categories are protected under French law:
- sexual identity;
- family status;
- genetic characteristics;
- ethnic origins;
- political opinions;
- union activities;
- physical appearance;
- family name;
- place of residence; and
- particular vulnerability stemming from the financial situation, apparent or known, of the discriminator.
Family and medical leave What is the position in relation to family and medical leave?
France has a generous family and medical leave regime which is frequently supplemented by collective bargaining agreements. Employees are entitled to 16 weeks’ paid maternity leave (six weeks before the birth and 10 weeks after the birth). Maternity leave may be increased in the case of illness, the birth of twins or triplets or if the mother already has two children. Many collective bargaining agreements offer full pay for all or part of maternity leave. Adoption leave usually mirrors maternity leave.
Male employees are entitled to 11 to 18 days of paid paternity leave.
Employees may request parental leave. Parental leave is unpaid and can last between one and five years, depending on the circumstances. Employees are entitled to return work after their leave, and employers must keep the same or an equivalent role available.
There are several types of medical leave which are paid by the state or additional insurance. Parents and carers are also entitled to take three to five days’ leave per year to care for a sick child.
Harassment What is the position in relation to harassment?
Harassment is a criminal offence under French law and is cause for termination. On the contrary, anyone who reports harassment is protected from termination. Employers have a duty to keep the workplace free from harassment, as they can be held liable for any injury caused to employees. Effective policies and early intervention may avoid employer liability.
Whistleblowing What is the position in relation to whistleblowing?
Whistleblowing procedures are usually addressed in companies’ internal regulations. Employers must clarify that employees will not be subject to any disciplinary measures if they alert the employer of genuine concerns.
Whistleblowing is a fairly recent mechanism in France and raises many data privacy issues where the whistleblower wishes to remain anonymous or keep the information confidential.
The Sapin Law, which is being reviewed in Parliament, may impose an internal procedure available to whistleblowers and broaden their protection.
Privacy in the workplace
Privacy and monitoring What are employees’ rights with regard to privacy and monitoring?
As a rule, employees must be informed of any monitoring by the employer. Monitoring must be proportionate and not invade employees’ privacy any more than is necessary. Under French law, employees may use their work email accounts to receive and send private emails; as such, employers cannot prohibit all personal use. Emails, files and documents clearly marked as private by the employee cannot be accessed by the employer, unless an appropriate court order has been obtained. A text sent with a company device, professional emails and data can be accessed, subject to due process.
To what extent can employers regulate off-duty conduct?
In principle, off-duty conduct cannot be regulated. However, if the employee’s actions damage the company’s reputations or rights, the employer may act. For example, if an employee reveals confidential information or harms the employer’s reputation on social media, the company can file a claim against him or her.
Are there rules protecting social media passwords in the employment context and/or on employer monitoring of employee social media accounts?
No specific rules protect social media passwords, but employers are prohibited from controlling an employee’s social media passwords. French case law differentiates between publicly available information on social media (or information that is available to a large group of people) and information which is available only to a select group of people. An employer may informally monitor an employee’s account only if it is publicly available.
Trade secrets and restrictive covenants
Intellectual Property Who owns IP rights created by employees during the course of their employment?
As the author of his or her creations, an employee owns any IP rights. However, there is an exception for software: a clause may be inserted in an employment agreement whereby the employee consents to let the employer use his or her creations, even after termination. A copyright sale cannot cover all future creations and must be limited. Therefore, IP clauses must be carefully drafted to avoid any post-termination litigation.
Restrictive covenants What types of restrictive covenants are recognised and enforceable?
The main types of restrictive covenant are:
- non-compete clauses;
- non-solicitation clauses;
- non-poaching clauses; and
- confidentiality obligations.
Non-compete Are there any special rules on non-competes for particular classes of employee?
Non-compete clauses can be valid, depending on the legitimate business of the company and provided that they are limited in time and geographical scope and that the employee receives financial compensation for the duration of the non-compete. The financial compensation is defined by the applicable collective bargaining agreement, employment agreement and case law and usually ranges from 30% to 60% of the employee’s monthly salary.
Discipline and grievance procedures
Procedures Are there specific laws on the procedures employers must follow with regard to discipline and grievance procedures?
Employers have access to a wide range of disciplinary actions, from verbal warnings to immediate termination. The actions and procedures are usually defined in the company’s internal regulations and the Labour Code. There is no specific grievance procedure under the statute.
Unions and layoffs Is your country (or a particular area) known to be heavily unionised?
France has one of the lowest rates of union membership in Europe. That said, unions still play a key role in French employment law, as they have the power to appoint representatives within an organisation and because of their role in negotiating collective bargaining agreements, which are extended to all employers at the national level in each relevant sector. Employee representatives (eg, staff delegates, works councils and health and safety committees) also play an important role in a company and union members are sometimes elected by these representatives.
What are the rules on trade union recognition?
To be recognised as a trade union, the union must:
- be financially transparent:
- be independent;
- have a certain number of contributions;
- be at least two years old; and
- have received at least 10% of the votes at the last works council or staff delegate election held by the company.
What are the rules on collective bargaining?
Collective bargaining exists at the national/industry level (eg, for national collective bargaining agreements) and the company/group level (eg, for intra-company agreements). Depending on the number of employees, companies may be subject to mandatory collective bargaining on an annual basis regarding specific subjects such as pay or gender equity.
To be considered as adopted, a company level agreement must be signed by unions recognised as representative within the company and together gathering 30% of employees’ votes at the last company’s election. This threshold will progressively increase to 50%.
Notice Are employers required to give notice of termination?
All termination notices must be in writing. The termination process is strictly regulated under French law and termination letters must explain the grounds for termination and contain certain mandatory information.
Redundancies What are the rules that govern redundancy procedures?
Terminations for economic reasons must follow a complex procedure which involves:
- selection criteria;
- looking for an alternative role for the employee; and
- explaining the reasons for the redundancy.
Redundancies must be notified to the labour authority. Certain reports and forms must also be filed to ensure that the employee receives unemployment benefits.
Are there particular rules for collective redundancies/mass layoffs?
Redundancies can be considered collective where two or more employees are at risk of redundancy over 30 days. The procedure will depend on:
- the number of employees in the company (fewer or more than 50 employees); and
- the number of employees at risk of redundancy (fewer or more than 10 employees).
This determines whether a social plan is required, the duration of the consultation and the labour authority’s level of intervention. To prevent employers from bypassing the 10-employee threshold over 30 days, if 10 employees were individually dismissed over a three-month period or if 18 employees were dismissed over a 12-month period, any new redundancy will be deemed collective.
Protections What protections do employees have on dismissal?
Employees are protected from dismissal from their first day of employment. In the case of unfair dismissal, an employee is entitled to financial compensation of up to six months’ salary if he or she has been employed with a larger employer for two years.
Employee representatives and pregnant employees enjoy additional protection. The termination of employee representatives is subject to the labour inspector’s approval. Pregnant employees and the second parent are protected against dismissal from the date that the employer is informed of the pregnancy to 10 weeks after the end of the maternity leave.
Jurisdiction and procedure Which tribunals or courts have jurisdiction to hear complaints?
The labour courts hear most employee claims. While this process is under review, two main types of proceeding offered by the courts:
- summary proceedings for urgent or simple matters; and
- standard judgment proceedings for all other cases.
The superior courts hear civil and criminal claims of a collective nature and the first-instance courts hears disputes on professional elections and the appointment of union delegates.
What is the procedure and typical timescale?
The length of the procedure varies depending on the labour court's location. Before a case may be brought before the labour court, the parties must undergo mandatory conciliation, failing which the parties will prepare for a judgment hearing. The entire process usually lasts between two and three years, subject to any subsequent appeals; however, the process is being reformed to improve timelines. Labour court judges are non-professional judges elected every four years. Depending on the circumstances, the court would be composed of:
- four labour court judges (two employee representatives and two employer representatives);
- two labour court judges for the fast-track proceedings; or
- four labour court judges and one professional judge for complex matters.
Appeals What is the route for appeals?
Each party has one month after being notified of the labour court’s judgment to appeal to the court of appeal on points of fact and law. No authorisation for leave of appeal is required from the labour court. The court of appeal consists of professional judges only. Court of appeal decisions are subject to a further appeal before the Supreme Court on points of law only.