Being an employer in France: Labor law consequences depending on the thresholds
- From 9 employees
- Transportation indemnity: 60 % apply in Paris.
- Contribution to the rental investment through the special employer housing tax (contribution au fonds national d’aide au logement) which rate is 0,10% and has to be paid by the employers whatever the work force of the company is.
- Monthly payment of the social contributions (instead of a quarterly payment)
- Contribution to the financing of the continuing professional training (formation professionnelle continue)
2. From 11 employees
In France, employees are represented through trade unions and structures directly elected by workers. Election of worker’s staff delegates have to be organized in all workplaces with more than 10 employees
The workforce threshold of 11 employees has to be reached on 12 consecutive months on the last 36 months.
- Staff delegates (Délégués du personnel).
The staff delegates (délégués du personnel) should be elected by workers in entities with more than 10 employees and are responsible for addressing individual and collective grievances to management and ensuring the implementation of legislation and collective agreements.
Staff representatives are protected and can only be dismissed with the labor inspector authorization.
At least 1 monthly meeting should be called.
3. From 20 to 49 employees
- Code of conduct (Règlement intérieur)
Reaching this threshold, the employer must implement a « Règlement intérieur » (Code of conduct), which set forth the rules that apply to all employees.
This implementation follows a specific process implying in particular the consultation of the staff representatives, the communication of the document to the Labor Inspector (the Labor Inspector being entitled to ask for amendments) and to the Labor Tribunal.
The Code of conduct may only contain provisions concerning (i) health and safety, (ii) rights of the defense and (iii) general and permanent rules concerning discipline and in particular the nature and gradation of sanctions that can apply.
- Contribution to the financing of continuing professional training (Participation au financement de la formation professionnelle continue (FPC) which rate is 1,60%
- Additional Contribution of 0,4% to the rental investment through the special employer housing tax (Fonds Nationale d’Aide au Logement)
- Hiring disabled people: must represent 6% of the global workforce. The infringement of this obligation leads to a tax payment representing for 2014, 3.812 € for each disabled not recruited.
4. From 50 to 200 employees
- Implementation of trade unions’ representatives
A trade union can appoint an employee as its trade union delegate. Only trade unions having constituted a union cell may appoint delegates. The number of delegates a trade union can appoint within the same company is based on the workforce.
The trade union delegate represents its union in the Company, address claims to the employer in order to improve the employees’ working conditions and negotiate the Collective bargaining agreements.
- Compulsory annual negotiation
The employer negotiates each year with trade union’s representatives on the following themes:
- Equality between men and women (targets to reach and medium to reach them)
- Situation of handicapped people in the company (access to the employment, professional training, working conditions)
- Employment of the seniors
- Wages, duration of work and organization of work time
- Prevention from hardness at work
- Implementation of a Works Council
The Works Council ensures the collective expression of the employees and protects their interests professionally, economically, socially, and culturally.
The Works councils receive information from employers on the Company’s financial and social issue. They also respond to formal consultations by employers on topics such as redundancies and vocational training (without formal negotiation power), and are responsible for managing social and cultural activities, for which they have a budget (0.2% of the company’s annual pay-roll).
At least 2 monthly meeting should be called.
Works Councils have specific rights regarding information, consultation, and alerts.
Any action from the employer that is likely to hinder the employee representatives’ functions, is a criminal offence that may be punished for the company’s legal representative by a maximum fine of 3,750 euros and/or a maximum of one year of imprisonment. The legal entity could also be punished by a maximum fine of 18,750 euros. These sanctions are currently discussed and the imprisonment’s sanction might be annulled.
- Implementation of a Hygiene and Safety committee (Comité d’Hygiène, de Sécurité et des Conditions de Travail)
Another council deals with health and safety issues for companies’ workforce representing more than 50 employees
This committee is now becoming very powerful and claims the same rights as the Works council, especially regarding redundancies, which makes job saving plan more complicated in France nowadays as the CHSCT can also block the project
- Compulsory profit sharing agreement: The aim of this agreement being to attribute a part of the profits of the company to the employees on the following calculation: ½ (profits net – 5% of owner’s equity) X (wages/added value).
- Job saving plan in case of redundancies
Firms employing 50 employees willing to dismiss more than 10 people on a 30 day period have to implement a Job saving plan.
The Job saving plan has to provide concrete and precise measures in order to avoid dismissals or reduce dismissal such as part time employment, work time reduction, development of new activities…
Redeployment within the company or the group must be done.
Before any Job saving plan’s project, the Hygiene and Safety committee and the Works council must informed and consulted. This entity must deliver its advice but it refusal does not block the project. They can however slow in several ways. As a consequence, a specific attention must be paid to them.
The Labor Administration (DIRECCTE) is also an actor in throcedure and can ask the employer to communicate elements or comply with the procedure rules
Please note that there is an ongoing collective bargaining regarding in particular the modification of these thresholds … Keep up to date!