Expanding business operations into a new country presents a myriad of challenges, particularly concerning legal and administrative compliance. In France, leveraging an Employer of Record (EOR) is a strategic move for companies aiming to establish a presence without navigating the complexities of local employment laws. Here's a comprehensive guide on utilizing an EOR in France:

Understanding the Employer of Record (EOR)

An Employer of Record is a third-party entity that assumes the responsibility of being the legal employer for a company's workforce in a foreign country. In France, an EOR manages payroll, tax compliance, and HR administration, and ensures adherence to local employment laws on behalf of the client company.

Benefits of Using an EOR in France

Legal Compliance and Risk Mitigation: France has intricate labor laws and compliance requirements. An EOR in France ensures compliance with employment regulations, minimizing legal risks and potential penalties for non-compliance.

Speedy Market Entry: Partnering with an EOR expedites market entry by eliminating the need for establishing a legal entity. Companies can commence operations swiftly without dealing with lengthy incorporation procedures.

HR and Payroll Management: The EOR handles HR tasks, including payroll processing, employee onboarding, termination procedures, and benefits administration, allowing companies to focus on core business functions.

Flexibility and Scalability: Businesses utilizing an EOR enjoy flexibility in workforce management. Whether hiring or downsizing, the EOR offers scalable solutions to accommodate changes in staff strength.

Steps to Utilize an EOR in France

Identify Business Objectives: Define the objectives and goals of entering the French market. Determine the scope of operations and the workforce required.

Choose a Reputable EOR: Research and select an established EOR with expertise in French employment regulations and a track record of providing reliable services.

Negotiate Services: Discuss and finalize the services required from the EOR, including payroll management, compliance, HR support, and any specific needs unique to the business.

Sign Agreement: Enter into a formal agreement with the chosen EOR, outlining the terms, responsibilities, and services provided.

Commence Operations: Once the agreement is in place, the EOR handles the legal and administrative aspects of hiring employees, enabling the company to initiate operations promptly.

Employment Laws in France

Capital: Paris
Language: French
Currency: Euro (EUR)
Payroll Cycle: Monthly

Employment Contract: There are two types of contracts Indefinite-term employment contract (CDI) or fixed-term contract  (CDD), which is only permissible in limited circumstances. 

Employment under a CDI contract cannot come to an end without the express wishes of one party or through the mutual agreement of the two parties. 

Minimum Wages: The minimum gross monthly wage in France is €1,747.20. 

Employer Taxes: Employer Taxes are approximately 43% - 48% of Gross salary. 

Working Hours: The weekly working hours are 35 (7 hours a day, five days a week). Hours worked beyond this quota are compulsory paid as overtime. 

Annual Leave: The Labor Code provides that employees are entitled to at least 2.08 working days of paid annual leave for every month of employment with the same employer, which results in an annual entitlement of 25 working days. 

Probation Period: The notice period in France depends on the duration of the labour relations.

- One month's notice for the employees who worked between six months and 2 years.

- Two months for blue-collar and white-collar employees.

- Three months for supervisors and technical employees. 

- Four months for managers and professional staff.

Notice Period: The notice period in France depends on the classification of the employee. For workers, one month's notice is required for an employment period of six months to two years. Two months’ notice is required for employment over two years or for supervisors. Executives are required to give three months’ notice. 

Termination: 

- An employer can dismiss an employee under an indefinite-term employment contract for either of  the following: 

- Termination of an indefinite-term employment contract is permissible on personal grounds and  economic grounds 

- Early termination of a fixed-term employment contract is permissible only in limited circumstances as stated by the French Labor Code.

Severance Pay:  Except in cases of dismissal for serious or gross misconduct, employees on indefinite-term contracts are entitled to a severance payment if they are dismissed, as long as they have at least eight months’  service with the employer. 

National Holidays:  11 National Holidays  

1. New Year’s Day  
2. Easter Monday  
3. Good Friday 
4. Labor Day  
5. Victory 1945 
6. Ascension 
7. Whit Monday  
8. National day  
9. Assumption  
10. All Hallows 
11. Christmas Day 

Employer of Record in France, Offered by ADT Solution

With our ADT Solution PEO and EOR Services, you get control without taking on legal entity liabilities, contractor risks, or sacrificing talent or speed to market and no more worrying about local laws, immigration visa and work permit services, tax compliance, or managing international payroll.  

ADT Solution takes care of everything in 30+ countries. For more details contact us about our Employer of Record in France.