Answer ... French labour and employment law is largely based on the following statutory sources, set out in order of priority:

• constitutional provisions, which notably include:
• • the French Constitution of 4 October 1958;
  • the Déclaration des Droits de l’Homme et du Citoyen of 26 August 1789;
  • the Preamble to the previous Constitution of 27 October 1946; and
  • the Environment Charter of 2004.
• They set out general principles, with which all other laws and regulations must comply. The most important in relation to employment are:
• • the freedom of trade unions;
  • the right to strike; and
  • the right of employees to engage in collective bargaining;
• international treaties and European law; and
• national statutory law, which is mostly set out in the Labour Code. Other relevant codes regulate specific issues surrounding the employment relationship, such as:
• • the Social Security Code; and
  • the Commercial Code regarding insolvency proceedings and consultation of employees in the context of the transfer of an undertaking or part thereof.

Answer ... In addition to the statutory sources of labour and employment law, the following rules may apply:

• contractual rules, which include collective bargaining agreements (national, industry or company level agreements), employer unilateral commitments and employment contracts;
• unwritten rules, which notably include working practices; and
• case law.

The French labour and employment law rules are subject to a specific hierarchy. Employment law must follow a ‘favourable treatment’ principle. In principle, the regulation that is most favourable to the employee will prevail. However, recent regulations have altered this principle in certain situations and a case-by-case analysis is required in order to determine the relevant regulation (Law 2004-391 of 4 May 2004; Law 2016-1088 of 8 August 2016; Ministerial Orders 2017-1385 of 22 September 2017).

Answer ... In principle, employment contracts need not be executed in writing (Article L.1221-1 of the Labour Code). In practice, however, almost all employees have a written employment contract.

Pursuant to the Employment Information Directive of 14 October 1991, a written document must be given to the employee within two months of the commencement of employment containing the following information:

• the identity of the parties;
• the place of work;
• the employee’s title and/or a description of his or her duties;
• the expected start date;
• the number of paid holidays;
• the notice period in the event that the employment is terminated;
• the salary, composition and period of payment;
• working time;
• the name and address of the relevant retirement fund and the welfare fund; and
• the applicable collective bargaining agreement, if any.

To comply with the directive, this information can be included on the employee’s payslips and the prior declaration of employment, and not in an ‘employment contract’, strictly speaking (Rép min, JOAN, 25 April 1994, p 2079).

By way of exception, a written employment contract is mandatory where this is provided for:

• by law – for example, for:
• • fixed-term employment contracts;
  • assignment contracts (ie, employment contracts between a temporary work agency and a temporary worker);
  • employment contracts for wage portage (which create a tripartite relationship between a worker, the employer agency and a client company that benefits from the service);
  • part-time employment contracts; and
  • employment contracts with a group of employers.
• In these cases, some additional specific essential terms must be included in the employment contract, as listed in the Labour Code; or
• by a collective bargaining agreement.

Answer ... Women are entitled to maternity leave and men are entitled to paternity leave after the birth of a child. All employees are entitled to adoption leave in case of the adoption of a child. In all cases, such employees benefit from special protection against dismissal for a limited period.

An employee with at least one year’s service is entitled to parental leave for each child under three years of age.

Leave is governed by both the Labour Code and applicable collective bargaining agreements.

Answer ... In principle, mothers have the right to 16 weeks of leave. This can be increased in the case of:

• a high-risk pregnancy;
• the birth of a third child and any additional child thereafter; or
• multiple births.

If the mother has benefited from social security pay for at least 10 months on the child’s expected birth date, she will be entitled, during her maternity leave, to a daily Social Security allowance equal to her average income in the three months preceding the prenatal leave up to the quarterly limit set by Social Security.

Optional paternity leave of 11 consecutive days (25 days as of 1 July 2021) or 18 days in the event of multiple births (32 days as of 1 July 2021) is compensated by Social Security under the same conditions as maternity leave. The mother’s partner, or a person linked to the mother by a civil union, is also entitled to paternity leave.

In general, adoption leave lasts for 16 weeks, but this is extended in the case of multiple adoptions or if there is more than one dependent child in the household. This is compensated by Social Security in the same manner as maternity leave.

Parental leave lasts for a maximum initial one-year period, which may be renewed twice. An employee on parental leave may continue to work part time. Leave may be extended for an additional year if the child is seriously ill or disabled.

Answer ... In France, freedom of association is a constitutional right and thus all employees have the rights to create, join or not join a union. Thus, a union or a division of a union can be created in any company, regardless of the number of employees.

However, the most important rights of trade unions are reserved for ‘representative’ unions, such as the ability to:

• appoint a union delegate;
• negotiate a collective bargaining agreement at the company level;
• negotiate a pre-election protocol; and
• present candidates in the first round of the elections of members of the social and economic committee.

To be considered ‘representative’ in a company, pursuant to Article L2121-1 of the Labour Code, the following criteria must be fulfilled by the union:

• respect of democratic values;
• independence;
• financial transparency;
• minimum length of service of two years in the company;
• sufficient representation (ie, the union must have obtained at least 10% of the votes during the first round of the works council/social and economic committee elections in the company);
• influence; and
• number of affiliated members and union dues.

Answer ... The private data of employees is protected by Article 9 of the Civil Code, which provides that “everyone has the right to respect for his or her private life”.

In addition, Articles L1221-9 and L1222-4 of the Labour Code provide that the personal data of an employee or a job applicant must not be collected without his or her prior knowledge.

Furthermore, the Data Protection Law and the French data protection authority’s recommendations protect the processing of personal data.

Also, pursuant to the EU General Data Protection Regulation, an employer must respect several key rules when processing the personal data of an employee:

• Comply with a principle of lawfulness, fairness and transparency;
• Justify any data collection by a lawful purpose and indicate those purposes to individuals when collecting their personal data;
• Collect and process only that personal data which is necessary to fulfil the specific purposes;
• Ensure the accuracy of the personal data;
• Ensure that the personal data is stored for no longer than necessary for the purposes for which it was collected; and
• Install appropriate technical and organisational safeguards that ensure the security of the personal data, including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage, using appropriate technology.

Violation of these rules may lead to civil sanctions (allocation of damages) and criminal sanctions.

Answer ... Contingent worker arrangements include many different types of working models, including:

• employees engaged under fixed-term employment contracts;
• part-time employees; and
• temporary workers.

An indefinite-term contract is the general hiring rule.

The use of employees under fixed-term employment contracts and workers supplied by temporary employment agencies are highly regulated by law and by the national inter-professional collective bargaining agreement of 24 March 1990. Such agreements can be used only in certain circumstances. A written contract with specific provisions must be signed. The contract may not exceed a maximum duration (18 months in most cases), and the number of times the contract may be renewed is regulated (a maximum of twice within the 18-month period).

The use of part-time employees must comply with several rules. It is possible either:

• if a collective bargaining agreement provides for the implementation of part-time work at the employer’s initiative; or
• following information and consultation of the staff representative.

The part-time work contract must be executed in writing and contain specific provisions.

If these conditions are not met, the working relationship may be reclassified as an indefinite-term employment contract.

Answer ... Pursuant to Articles L3231-1 and following and Articles R3231-1 and following of the Labour Code, there is a national minimum wage per hour: the ‘salaire minimum interprofesionnel de croissance’ (SMIC).

The SMIC is:

• applicable for employees over 18 years old;
• applicable to nearly all private sector workers, except some specific categories of workers, such as commission-based sales representatives; and
• reassessed by the government annually.

As of 1 January 2021, the hourly minimum wage is €10.25 (ie, a gross monthly salary of about €1,554,58 for full-time contracts).

Base salary, bonuses and other benefits in kind must be taken into consideration to check that the employee’s wage is at least equivalent to the SMIC.

Nevertheless, pursuant to Article L2254-1 of the Labour Code, collective bargaining agreements can provide for a more favourable minimum wage.

Answer ... All hours worked over the ‘legal work time’ (ie, in principle, above 35 hours per week) are overtime. Pursuant to Article L3121-28 of the Labour Code, overtime must be either paid or compensated by equivalent periods of paid rest.

Pursuant to Article L3121-33 of the Labour Code, a collective bargaining agreement at the company, local or branch level can provide the appropriate overtime rate for overtime. This rate may not be less than 10%.

In absence of a CBA, the overtime rate is fixed at:

• 25% from the 36th hour to the 43rd hour; and
• 50% from the 44th hour.

In lieu of compensating the employee in wage premiums, the employer may choose to offer the employee an additional rest period within the following pay period, pro-rated to the extent of the pay premiums.

There is an annual overtime threshold of 220 hours. An employee who works overtime above this threshold in a calendar year should be offered rest or compensation at an additional 100%.

Answer ... Pursuant to Articles L3141-3 to L3141-12, D3141-3 and R3141-4 of the Labour Code, for an entire year, employees are entitled to 30 working days (Monday to Saturday) or 25 weekdays (Monday to Friday) of paid vacation.

Employees accrue paid leave of 2.5 working days per month on effective work for the same employer. Both work and other periods considered equivalent to effective work (eg, paid vacation, maternity or paternity leave, occupational disease leave) are taken into consideration for the purposes of leave accrual.

Unless provided otherwise in the collective bargaining agreement, paid vacation days are accrued during a reference period from 1 June to 31 May.

In addition to the statutory rules, many collective bargaining agreements grant additional days of paid vacation (eg, family-related leave).

Answer ... Under French law, in case of illness, a combination of two mechanisms ensures a legal guarantee of resources for the employee.

First, the employee is entitled to social security payments. These are equal to 50% of the employee’s daily income (or 60% to 80% in case of occupational diseases). They are guaranteed by Social Security for up to three years.

In addition, the employer must supplement the social security payments.

The following conditions must be fulfilled by the employee:

• having at least one year of employment as of the first day of absence;
• justifying the absence to the employer within 48 hours by producing a medical certificate, unless the employee was victim of terrorist actions;
• being covered by the social security scheme; and
• receiving medical care in the EU territory or a member state of the European Economic Area.

Subject to these conditions, the supplementary compensation paid by the employer begins after a seven-day waiting period (except in the case of occupational illnesses), and ensures that the employee receives:

• 90% of his or her gross salary for the first 30 days of sick leave; and
• 66% of his or her gross salary from the 31st to the 60th day.

This may be extended up to a total of 90 days, depending on length of service.

Collective bargaining agreements generally provide for additional favourable terms (eg, remit payments such that the employee receives 100% of his or her gross salary; removal of the seven-day waiting period).

Answer ... In principle, the statutory age to apply for a retirement pension is 62 for people born in or after 1955. In some specific cases, it is possible to retire before that age – for example, in case of a long career or a disability, or for people born before 1955.

To be eligible for full retirement, the employee must have:

• worked as an employee for between 166 and 172 quarters, depending on his or her birth date; or
• reached the age of 67 for people born in or after 1956 (for people born before this date, the statutory age for full retirement is set out below).

Thus, an employee may wish to work until he or she is eligible for full retirement and is not required to retire when he or she reaches the statutory retirement age of 62.

In any case, pursuant to Article L1237-5 of the Labour Code, employers may force the retirement of employees who have reached the age of 70 or older. For employees below the age of 70, to the extent that they have reached the statutory age to apply for full retirement (ie, 67 for people born in or after 1956), employers may only ask them whether they want to leave the company and benefit from retirement, following a specific process.

Answer ... In France, there is a general principle of non-discrimination. Pursuant to this principle, no one may be excluded from the recruiting process and no employee may be disadvantaged or dismissed due to one of the following criteria:

• origin;
• sex;
• moral standards;
• sexual orientation;
• marital status;
• gender reassignment;
• age;
• pregnancy/maternity;
• membership of a particular ethnic group, nation or race;
• political opinions;
• trade union activities;
• elected public office;
• religious beliefs;
• physical condition or disability (unless an occupational doctor has duly certified the person as unfit to work);
• place of residence;
• bank domiciliation; or
• French language ability.

In addition, no employee may be dismissed for exercising the right to strike.

Both direct discriminatory actions (when one person is treated less favourably than another in a comparable situation based on one of these criteria) and indirect discriminatory actions (any apparently neutral measure that has discriminatory effects) are prohibited.

Conversely, the general rule is that any ‘affirmative action’, consisting in the adoption of more favourable measures for some people who meet specific criteria, is prohibited. By way of exception, the Labour Code authorises affirmative action only if:

• it is laid down by law; and
• it is conducted in compliance with the law.

In other words, under French law, only a restrictive list of minority groups can benefit from affirmative action and only in specific conditions (eg, affirmative action for disabled people or women may be allowed under some conditions; but affirmative action based on origin, for instance, is forbidden).

Answer ... Article L1132-1 of the Labour Code lists the following classifications or groups that are entitled to protection against discrimination:

• origin;
• sex;
• moral standards;
• sexual orientation;
• marital status;
• gender reassignment;
• age;
• pregnancy/maternity;
• membership of a particular ethnic group, nation or race;
• political opinions;
• trade union activities;
• elected public office;
• religious beliefs;
• physical condition or disability (unless an occupational doctor has duly certified the person as unfit to work);
• place of residence;
• bank domiciliation; or
• French language ability.

However, this list is not restrictive or exclusive. Specific types of discrimination are also set out in the Labour Code, as follows:

• trade union discrimination;
• discrimination relating to the exercise of the right to strike;
• discrimination regarding compensation based on gender;
• discrimination resulting from sexual harassment; and
• discrimination based on pregnancy status.

Answer ... Aside from the rules mentioned in questions 4.1 and 4.2, there are no legal provisions laying down specific protection measures against discrimination in the workforce.

However, a general principle of non-discrimination applies to all employers and employees, as well as prospective employees, trainees and apprentices. As such, employers must ensure equal treatment for the workforce and ensure that they are neither discriminated against nor harassed.

In addition, pursuant to Article L4121-1 of the Labour Code, employers must take all necessary measures to ensure health and safety in the workplace. To this end, employers may undertake preventive actions such as training to avoid potential risks in the working environment (eg, discriminatory behaviour, harassment).

Employers must take actions in case of discriminatory behavior within the company. Thus, the harasser or the person guilty of discrimination can be subject to a disciplinary sanction by the employer.

Companies can also adopt codes of conduct or codes of ethics to help prevent prohibited discrimination and harassment.

Answer ... In case of discrimination, an individual who believes that he or she has suffered from discrimination can:

• bring a claim before the employment tribunal to seek damages (civil action) within five years of disclosure of the discrimination;
• establish a discrimination claim, in which case a specific two-part burden shifting rule of evidence applies. The burden is first on the employee to present a prima facie case of discrimination. If such a case is presented, the burden shifts to the employer to prove that it did not discriminate;
• bring a claim before the criminal authorities, which could lead to criminal sanctions; or
• refer the case to the Human Rights Defender, which is an independent institution that combats discrimination and promotes equality. The powers of the Human Rights Defender include:
• • stating an opinion on the merits of the complaint;
  • making recommendations;
  • requesting the implementation of necessary measures; and
  • facilitating an amicable resolution of the dispute.

Answer ... Potential remedies for prohibited discrimination include:

• the invalidation of any discriminatory measures;
• damages to compensate the prejudice suffered;
• criminal penalties of up to three years of prison and a fine of:
• • €45,000 in the case of discrimination regarding hiring, sanctions, termination or training; or
  • up to one year’s imprisonment and a fine of €3,750 in the case of harassment and infringement of equality provisions regarding women and men; and
• re-establishment of the employee’s rights and damages.

Conversely, pursuant to Article 226-10 of the Criminal Code, false claims of discrimination can entail criminal sanctions (ie, up to five years’ imprisonment and/or a fine of €45,000).

Answer ... The Labour Code sets out protection and remedies against sexual and moral harassment, as follows:

• No employee, trainee or job applicant can be sanctioned, subject to a direct or indirect discriminatory measure or dismissed for having been subject or having refused to be subject to acts of sexual harassment.
• Employees are protected against ‘moral harassment’, which is legally defined as repeated conduct towards an employee aimed at damaging his or her working conditions in a way which is likely to alter his or her rights, dignity or mental or physical health, or to compromise his or her professional future.
• Any employee who engages in or condones sexual or moral harassment will be liable to both disciplinary and criminal action.
• Employers are obliged to implement all necessary measures to ensure effective protection from, and prevention of, moral and sexual harassment. Reference must be made to the relevant legal provisions regarding sexual and moral harassment in the company’s internal regulations. Failure to do so may result in both criminal and civil actions.

Retaliation: Article L1132-3-3 of the Labour Code protects employees who give testimony or report on discrimination. Complaining employees cannot be sanctioned, terminated or discriminated against, directly or indirectly. The termination of any employment contract, or any measure or action disregarding these rules, is void.

Answer ... An employer needs a ‘real and serious cause’ to lawfully terminate an employment contract. Thus, a dismissal must be based on one of the following:

• personal grounds related to the employee, including:
• • his or her professional insufficiency;
  • lack of results;
  • simple misconduct – for example, insubordination, disloyalty or desertion from post;
  • ‘gross misconduct’, defined as misconduct that is sufficiently serious to mean that the employee cannot stay even one day more at the company; or
  • ‘intentional misconduct’, defined as misconduct that implies the employee’s intention to harm the company.
• The personal grounds for dismissal must be objective, real, precise and sufficiently serious to justify termination of the employment contract. A case-by-case analysis will be conducted by the judge in case of litigation;
• ‘economic grounds’, defined as dismissal that results from one of the following:
• • downsizing or restructuring of a position; or
  • refusal by an employee of a modification to his or her employment contract (eg, modification of salary, work time, level of responsibility, work location).
• This measure must be justified by one of the following economic reasons:
• • economic difficulties based on the significant development of at least one economic indicator, such as a decrease in orders or sales, operating losses or degradation of cash, or any other evidence to prove such difficulties;
  • technological advancements;
  • reorganisation of the company which is necessary to safeguard its competitiveness; and
  • termination of the entire business activity of the employer.

Answer ... Article L1234-1 of the Labour Code provides for the following notice periods, depending on the seniority of the employee:

• one month for seniority of between six months and two years; and
• two months for seniority of two years or more.

The notice period begins upon receipt of the dismissal letter through the post.

Most collective bargaining agreements provide for a longer notice period. Thus, for employees of executive status (‘cadres’), the notice period is generally three months.

The employer can decide to exempt the employee from the notice period while paying his or her salary until the end of the notice period.

Exceptionally, in some cases, no notice period is required or paid (eg, dismissal for gross or intentional misconduct, termination by mutual consent or ‘rupture conventionnelle’).

Answer ... If the employee is dismissed without ‘real and serious cause’, the Labour Tribunal can grant damages to the employee.

Damages are determined by the judge according to a mandatory damages scale set out in Article L1235-3 of the Labour Code and vary from one to 20 months’ salary, based on the size of the company and the employee’s seniority.

The mandatory damages scale does not apply if the dismissal is deemed null and void under law – for example:

• in case of breach of a fundamental right (eg, freedom of speech, right to strike);
• if the dismissal is based on discriminatory grounds, a claim of sexual or moral harassment, or a gender pay gap claim; or
• in case of wrongful dismissal based on an employee’s protected category or breach of a protection tied to pregnancy.

In such cases, the dismissed employee is entitled either to reinstatement and back pay or to damages of at least six months’ salary.

Answer ... During the notice period, employees continue to accrue vacation. Thus, on the date of termination of an employment contract, the employer must pay the employee for any accrued vacation not taken.

In addition, if an employee is dismissed, he or she will be granted a notice period or compensation in lieu of notice (ie, wages, overtime and bonuses), paid each month on the normal dates of payment, except in case of gross or intentional misconduct (see question 5.2.).

Upon termination of employment, except in case of gross or intentional misconduct, all employees are entitled to severance pay. In principle, the required seniority for severance is eight months. The severance pay will amount to:

• at least one-quarter of a month’s salary per year of service up to 10 years of seniority; and
• one-third of a month’s salary per year of service after 10 years of seniority.

The salary is calculated based on compensation in the last 12 months preceding dismissal (or, if the seniority is under 12 months, in all months preceding dismissal), or in the last three months if more favourable. In principle, it includes all types of compensation (eg, bonuses, commissions, benefits in kind).

However, a collective bargaining agreement may provide otherwise.

Answer ... Dispute between an employer and an employee may be resolved through:

• litigation before the labour tribunal, which has exclusive jurisdiction over such matters; or
• a settlement agreement, which sets out the terms and conditions agreed by the parties in order to resolve their dispute.

Collective labour disputes (eg, cases brought by the social and economic committee or unions) are heard by the courts of general competence: the tribunaux judiciaires. The parties can also resolve their dispute through methods of alternative dispute resolution, such as conciliation, mediation or arbitration.

Answer ... Proceedings before the Labour Tribunal may be initiated by a complaint addressed to the clerk of the Labour Tribunal. The complaint must contain mandatory information and a summary statement of the reasons for each claim, together with the documents that the plaintiff wishes to invoke in support of the claims and a statement listing such documents.

In principle, the procedure involves two phases:

• a conciliation phase, during which parties are encouraged to reach agreement to resolve their dispute. If the parties reach agreement, the procedure ends; if they fail to reach agreement, the case will progress to the hearing phase. Exceptionally, urgent summary proceedings are exempt from the conciliation phase; and
• a hearing phase, during which the parties are heard by the Labour Tribunal, which will render its decision.

The duration of first-instance proceedings can vary significantly, depending on the case backlog, but will generally range between six and 12 months.

The first-instance decision of the Labour Tribunal may be appealed before the Court of Appeal within one month of notification of the decision to the parties or 15 days in case of the accelerated procedure.

The Court of Appeal’s decision can also be appealed before the French Supreme Court.

If a case proceeds through all instances of appeal, it usually takes between three and six years to resolve.

Answer ... As mentioned in question 5.3, damages awarded to the employee in case of dismissal without ‘real and serious grounds’ are determined according to a mandatory damages scale set out in Article L1235-3 of the Labour Code. However, this scale will not apply if the dismissal is deemed null and void under the law. That is why, in practice, we have noticed an increase in moral harassment claims based on infringement of the employer’s obligation to provide security and prevent psychosocial risks in the company.

Against the backdrop of the COVID-19 pandemic, the main reforms to be introduced in the employment sphere have been postponed (eg, reform of pensions and unemployment insurance). In the meantime, a range of measures have been adopted to support companies during the pandemic and have been extended for 2021. They include the following:

• implementation of partial activity, which allows employees’ activities to be reduced due to temporary economic difficulties. Employees’ compensation is maintained to some extent and the employer can benefit from government support;
• the ability to negotiate long-term partial activity with unions where a lasting impact on the company business so requires; and
• deferred payment of social security contributions through prior request to the competent authority, which will issue a debt settlement plan for reimbursement.

New legislation also allows the payment of a tax-free bonus of up to €1,000 in 2021. This bonus may be increased up to €2,000 for companies that enter into a profit-sharing plan before 30 June 2021.

Answer ... The hierarchy of norms in French employment law is broad and specific. The mere application of the Labour Code is insufficient. Therefore, it is strongly recommended that foreign companies planning to hire employees in France determine:

• which collective bargaining agreement applies, according to the relevant business sector. This collective bargaining agreement will outline many of the terms and conditions of employment; and
• which regulations will apply in case of a conflict of laws.

Working hours are a crucial issue in the employment relationship in France and must be carefully considered in view of the significant risks incurred (both financial and criminal) in the event of non-compliance with the applicable rules.

In addition, all French companies with at least 11 employees must establish a social and economic committee, which must be periodically informed and consulted about the company’s situation or individual situation (eg, dismissal for physical inability recognised by an occupational doctor). Failure to do so may lead to significant issues (eg, the offence of impeding the action of the social and economic committee; dismissal ‘without cause’).

Moreover, in France, in principle, reverse discrimination is prohibited and can lead to criminal and civil sanctions.

Finally, in the context of a dispute before the Labour Tribunal, if the judge has any doubt, it will decide in favour of the employee. In general, and with some exceptions, the burden of proof lies mainly with the employer. Thus, the latter should carefully gather proof of compliance with the law or proof of the infringement of the employee’s obligations.