Each labour market has some peculiarities. It may be tricky for foreigners to fully understand the payment methods, the taxes and other benefits related to them. In TalentUp, we are starting a series of different blog articles, one for each country. This article analyses the French labour market.

General data about the French labour market

In France, the 13th salary is very common, and some companies even pay the 14th salary to their workers. This is optional, not compulsory. The payment date is usually around November or December, but it’s up to the company’s decision.

Payroll taxes in France

Social security contributions are made by the employer and the employee and are used for funding unemployment, pension, maternity/paternity leave, and sickness or injury.

The healthcare in France covers about 70%-80% of the medical costs with the remainder being paid by supplementary private health insurance. For employed individuals, the insurance is paid by the employer; unemployed individuals need to pay it themselves.

Once contributions are paid, employees need to pay an income tax that varies depending on their gross salaries. 

Contingencies from self-employees

Self-employed workers’ social security contributions are calculated based on their self-employed, non-agricultural earnings that are taken into account for their income tax calculation

Example of net salary in France

As a reference, we use the average salary of a software engineer. In France, on average, software engineers earn annually 55,000€.

The employer contributes from 17,358 to 29,760.5€ to social security and the employee 9,350 to 16,901.5€.

After paying the income tax, the employee has a net salary of 32,574.65 to 37,860.70€ coming from a gross salary of 55,000€.

Unemployment regulation in France

Before the resignation, notice should always be given to the employer. Even so, it can be either verbally or in writing and there is no established notice period, some companies or industries establish it by contract.

When is the employer the one that wants to terminate the contract,  a preliminary dismissal interview must be set up and take place. 2 days to a month after the meeting a letter of dismissal must be sent to the employee. Then, the notice period is:

The severance payment is done with the option that gives a most favourable income:

Different kinds of leaves in France

In France, there are 11 public holidays with May 1st being the only statutory paid holiday.

Employees are entitled to 2.5 days of monthly leave which represents 5 weeks a year.

Sick leaves start after the first three days. Sick pay represents 50% of the average daily earnings of the worker. In order to receive it, the employee needs to have worked, at least, one of the following:

An injured employee is entitled to their full daily wage for the day of the accident. 

Leave for family events is:

Paid parental leave

One big particularity of the French labour market is that the parental leave duration depends on if it is the first, second or third birth and whether they are twins.

Male employees are entitled to three days leave on the birth or adoption of a child. They are also entitled to 11 consecutive days of paternity leave (18 if there are multiple births or adoptions), which must be taken within the four months following birth or adoption.

Adoption leave is given and equal for both spouses and duration is:

Other common French benefits

In some companies it is common to receive disability/life Insurance -after one- or two-years seniority. During this period the employee receives 100% of his salary.

Many companies also give meal vouchers. The cost of meal vouchers is usually split 50%-50% between the employee and the employer up to a ceiling defined by law.

For senior position holders, it is common to have a company car. Fuel reimbursement is included. For other positions, commution allowance for public transport and/or by bike is given.

Another common benefit is the chèques-vacances. This is a national voucher scheme for paying at gites, holiday camps, hotels, youth hostels etc. They are provided by the ANCV (Agence Nationale pour les Chèques-Vacances).

How to employ a French worker

A foreign company that does not have a place of business in France and hires employees to perform work in France is subject to the French Social Security system.

The company must:

To declare and pay Social Security contributions, companies may sign an agreement to appoint a representative residing in France. However, this is not compulsory since employers  can also make all declarations and pay contributions in one go by way of the foreign firms slip (« titre firmes étrangères »/ TFE).

Some platforms (Papaya Global among them) offer the Employer of Record (EoR) service helping companies hire countries where they do not have any office.

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