Hiring employees in France is an exciting growth strategy for global companies. However, foreign employers interested in engaging the local talent pool must have a firm grasp of France’s labor laws, which include administering mandatory benefits.
Still, providing required entitlements to prospective employees isn’t enough to retain top talent. Companies must go beyond statutory benefits and provide supplemental rewards that fill gaps where mandatory benefits lack and help your French talent feel valued.
Read this guide to learn mandatory and common employee benefits in France and how to compliantly provide these benefits to your workforce in the country.
Mandatory benefits in France include health insurance, pension, life and disability insurance, death insurance, unemployment benefits, and workers’ compensation.
French employees also typically receive common benefits not required by law, such as supplemental health insurance, supplemental parental leave, and 13th-month pay.
Under France’s social security scheme, employees are entitled to several benefits that cover all life risks, from health to disability to death. French labor law requires employers to contribute to the following statutory benefits provided by French social security.
Learn more: What Are Statutory Benefits?
French residents enjoy universal healthcare coverage, financed primarily by the government. However, French employees and employers also contribute to this national healthcare system through payroll taxes at a rate of 80% for the employer and 20% for the employee.
Companies hiring employees in France must also provide private health insurance, known as a mutuelle, to their employees, which reimburses medical costs not covered by France’s national healthcare system. While contributions vary based on collective bargaining agreements and industry, employers and employees typically contribute 50% each to the mutuelle.
In addition to the basic pension benefits under France’s social security scheme, employers must also provide a mandatory complementary pension called Agirc-Arrco.
The contribution rates for Agirc-Arrco are proportional to salary and employee status. Employers and employees contribute to Agirc-Arrco through payroll taxes, with employers contributing a minimum of 1.9% and employees contributing a minimum of 0.4% of total earnings.
Though the legal retirement age is 64, the age for full automatic pension entitlement is 67.
Life and disability insurance
France requires that employees receive life and disability insurance, or prévoyance, which includes life, long-term, and short-term disability benefits. Prévoyance is paid fully by the employer.
Employees who claim long-term disability benefits must be younger than retirement age, have lost at least 66.7% of earning capacity due to the disability, and have at least 12 months of coverage and 600 hours of employment in the last 12 months before the disability began.
Employees who claim short-term disability can expect 50% of their daily salary for the previous three months. They can earn up to 67% if they are out of work for over 31 days and have at least three dependent children.
Death insurance is a portion of the deceased's pension that goes to surviving relatives. It's also known as a death grant. For relatives to qualify for the death grant, the deceased employee must have been receiving a disability or unemployment pension at the time of death, or they must have been employed within three months prior to their death.
Employees contribute 2.4% of their monthly salary to unemployment benefits, and employers contribute 4% of salaries at up to €12,680 per month.
To claim unemployment benefits, employees must have been paying into the scheme for at least 122 days in the last 28 months below the minimum retirement age. Employees must also have resigned for valid reasons, had their contract terminated, finished a fixed contract, or mutually agreed to leave their job.
Payouts are determined on contributions and salary in the 12 months leading up to job loss.
French employers pay workers’ compensation based on the assessed cost of employee insurance. French labor officials assess each workplace based on the degree of risk for the activity. If a company reports work-related injuries, labor officials require a higher payout for workers’ compensation contributions.
Employees in France are entitled to several types of leave, including annual, sick, maternity, paternity, family, and adoption leave.
Employees in France are entitled to five weeks of paid leave in addition to one paid holiday (Labor Day). However, most French employers give their teams time off to observe the following national holidays:
- New Year’s Day (January 1)
- Easter Monday (March or April, depending on the year)
- Victory in Europe Day/End of World War II (May 8)
- Ascension Day (May or June, depending on the year)
- Whit Monday (May or June, depending on the year)
- Bastille Day/National Day (July 14)
- Assumption of Mary (August 15)
- All Saints’ Day (November 1)
- Veterans Day/Armistice Day/Remembrance Day: End of World War I (November 11)
- Christmas Day (December 25)
The French government mandates that employees receive 50% of their standard daily wage for up to six months of sick leave. However, they must have at least 150 logged work hours during the three months before their time of leave to receive this benefit.
Beyond this government requirement, collective bargaining agreements or employment contracts may dictate that employees receive more than 50% of their daily wage during sick leave.
Maternity and paternity leave
Maternity leave in France includes 16 weeks of leave (usually six weeks before the birth and 10 weeks after). Mothers must take at least eight weeks’ leave but can take up to four additional weeks after the birth should complications arise.
Fathers are entitled to 25 consecutive days of paternity leave or 32 days if the family has twins.
Employers calculate maternity or paternity leave allowance based on the employee’s average income three months prior to the employee’s leave.
Read more in our complete guide to paid maternity leave by country.
Parents who adopt are entitled to 10 weeks of leave or 22 weeks of leave in the case of adopting more than one child.
Learn more about France’s statutory employee benefits and labor laws.
In France, companies with more than 20 employees must observe a 35-hour workweek. However, many employees choose to work more than 35 hours a week, which requires employers to pay their talent for that overtime.
Rather than providing financial compensation for overtime, employers may enter into another common arrangement with their French employees known as réduction du temps de travail or reduction of working time. This scheme allows employees to receive additional paid time off for working over 35 hours per week.
The company determines the number of paid days off employees receive for working past 35 hours per week and notes it in the employment agreement.
Beyond mandatory leave and other required benefits in France, employers also provide common benefits to their employees beyond what’s required by law. These include supplemental health insurance, supplemental parental leave, and 13th-month pay.
Learn more: What Are Supplemental Benefits?
Supplemental health insurance
Despite France’s comparatively generous healthcare scheme, French residents still expect additional coverage as part of an employer’s competitive rewards package.
As an added benefit, employers may choose to increase their contribution to the mutuelle beyond the statutory 50% to cover costs for procedures like vision and dental care. They may also increase contributions to cover medical costs for their employees’ dependents.
Supplemental parental leave
It’s common for French employers to provide more than the mandated time off for new parents. Additional time off ranges from a few days to an entire month of additional paid leave.
In France, it’s customary for employers to provide their employees with 13th-month pay. This additional payment is typically equal to one month’s salary and is paid out at the end of the year.
If you want to hire and retain the best talent in France, it’s wise to go beyond the common benefits described above and offer fringe benefits that support candidates’ lives and well-being outside of work. Below are some perks that help companies stand out from the competition:
- Flexible work hours. Offering employees flexible working hours is an increasingly common trend among top employers in France. For younger professionals, a flexible work schedule can be even more important than a salary boost.
- Supplemental transportation reimbursement. While French employers must cover 50% of their employees’ public transportation expenses, many companies opt to cover more than the required 50% in an effort to attract top talent.
- Meal vouchers. Some French companies offer employees meal vouchers, also known as ticket restaurant, which pay for all or part of employees’ meals. Employers are free to determine their contribution amount.
- Work equipment. Another common fringe benefit is providing work equipment, or an office stipend, to employees. This benefit allows workers to buy items like laptops, desks, or chairs to create an optimal working environment at home.
- Gym allowance. Also known as a wellness benefit, offering a gym allowance is increasingly popular among French companies. The allowance provides for things like monthly gym membership fees, yoga classes, or personal training.
Global companies that hire in France must understand all mandatory and common employee benefits to ensure compliance with local labor laws and edge out competitors.
Fortunately, you can shed the burden of administering compliant, competitive employee benefits in France when you partner with Velocity Global.
Our Global Benefits Solution makes it easy for companies to provide impressive rewards for top talent in France. Velocity Global’s team of experts crafts and administers market-specific benefits packages that are not only compliant with local statutory requirements but are attractive and meaningful to your top candidates.
Build and retain a winning team in France with competitive global benefits. Contact us today to get started.