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International PEO

Hiring Employees in France: A Guide for Global Businesses

By September 23, 2022September 28th, 2022No Comments
Arc de Triomphe in Paris with a big French flag under it

As one of the most advanced countries in the world, France is an alluring region to expand into for many global companies. But hiring employees in France requires a thorough understanding of French employment laws and payroll requirements to ensure compliance and avoid troublesome complications.

How Do I Hire a Foreign Worker in France?

There are multiple ways to hire and pay workers in France such as setting up an entity or paying contractors. However, it’s important to first understand the employment and classification laws in France. An essential first step to hiring in France is classifying your talent as either employees or contractors. This classification status will determine your hiring method.

Two Methods for Hiring Employees in France

There are two primary methods for hiring employees in France: Setting up a legal entity or partnering with an employer of record. The former requires a fair amount of independent research and long-term expansion goals, while the latter saves the business time and non-compliance fees.

How to hire employees in France: Set up a legal entity or partner with an employer of record

Set Up a Legal Entity in France

If your company has plans to create a permanent establishment in France, establishing a legal entity is an effective option for hiring employees in France.

Setting up an overseas presence in France requires time and in-depth research to ensure employment compliance. Entity establishment is also costly and requires a long-term financial commitment. This method is suited for businesses wanting to form a long-term presence and build a large team.

Once a company sets up an entity in France, a multi-country payroll system is beneficial for running and managing payroll, especially for companies that have talent in multiple countries.

Partner With an Employer of Record

If your business is ready to expand into France but doesn’t want to invest or have the resources for entity establishment partnering with an employer of record (EoR) provides swift country entry and the ability to hire employees.

An EoR allows companies to hire talent in a new country without having to set up a local entity. Beyond managing contracts and onboarding payroll, a global EoR also handles immigration and provides benefits for foreign employees. An employer of record is a convenient choice for businesses looking to build a team in France and have the local expertise to guide them through evolving employment requirements.

Two Options for Engaging Contractors in France

Hiring contractors is a faster way to expand into France and requires less commitment in comparison to hiring employees. There are two primary options for engaging and paying contractors in France: Set up a contract and use a contractor payments solution or partner with a comprehensive contractor management solution.

How to engage contractors: contractor payments or contractor management

Use Contractor Payments

When engaging a foreign contractor in France, it’s important to determine how to securely pay them. Businesses often opt for a contractor payments solution to onboard new contractors and securely send payments across multiple countries. Standard contractor payments partners typically provide document storage, localized expert-vetted contracts, and the option to automate payments.

Partner With a Contractor Management Solution

The misclassification of workers is a common occurrence, which is why many companies opt for a contractor management solution.

With a contractor management solution, companies can hire contractors quickly and avoid combing through the legalese to ensure compliance. Along with onboarding, a contractor management solution takes care of invoicing and payments, locally compliant contracts, and proper classification. A comprehensive contractor management partner ensures compliance while engaging contractors in France, saving legal and compliance fees.

FAQs About Hiring Employees in France

Can a U.S. Company Employ Someone in France?

Yes, a U.S. company can employ someone in France. Common solutions include partnering with a France employer of record to hire employees or a contractor management partner to engage French contractors.

However, the risks of noncompliance in France are high. French employment laws have stricter employee protections when compared to other countries like the U.S. For example, an employee can only be dismissed in very specific circumstances, and only after completing a regulated dismissal process. Failure to adhere to French labor laws costs companies time, capital, and resources that are better spent growing their business.

How Much Does it Cost to Employ Someone in France?

The costs for employing someone in France depend on how the worker is employed. Employees typically cost more and require a larger financial commitment than contractors due to payroll contributions, leave entitlements, and employee benefits.

Because of unfamiliar payroll contributions and tax, employment costs in France are difficult to forecast and budget without in-country expertise. This makes it critical for overseas businesses to seek a workforce partner that accurately calculates employee costs and compliantly navigates employment processes in France.

Confidently Grow Your Team in France

France has a great reputation for business, but its stringent employment laws make it a challenging country to expand into without a partner.

Many businesses partner with Velocity Global’s Employer of Record to accelerate hiring employees in France. Our EoR solution takes care of onboarding, payroll, benefits, and immigration so you can set your sights on operations and your team.

If hiring contractors in France better suits your company’s objectives, Velocity Global’s Contractor Management (Agent of Record) can help you onboard, pay, and manage French contractors without worrying about noncompliance or misclassification.

Contact us today to find out how to expand your business into France.