Terminating an employee can be an unpleasant, albeit necessary part of running a business. But even when you have due cause and evidentiary documentation to back the decision, it can put you and your company in a precarious legal position. And if you operate internationally, it can be even trickier.
In France, for example, terminated employees are entitled to an employment law notice period before being dismissed. The timeframe depends on what the employee and employer have agreed on in their employment contract—although one to three months is typical. In cases of gross misconduct, immediate termination may be permissible.
Because termination rules can be cumbersome and complicated in France, this guide will help you understand termination considerations of the local employment law.
Viable reasons for termination in French employment law
The rules regarding terminating employees are more stringently regulated in France than in the U.S. The French Labor Code—Code du Travail—is complex and tends to favor the employee over the employer.
In France, an employer that seeks to terminate an employee is required to show just cause—réelle et sérieuse—and adhere to dismissal procedures. Grounds for dismissal must be substantive. Accordingly, there are two primary reasons for firing an employee that are considered justified:
- Personal – Termination in response to either worker inadequacy or misconduct. This could be because of theft, incompetence, failing to show up to work, or disciplinary issues.
- Economic – Termination in response to hardships that the company is facing, such as considerable changes in technology, loss of business, or transfer of personnel.
Article L1232-1 of French employment law states that dismissal may be justified if there is a real and serious cause, which can be broken down into disciplinary reasons or external poor behavior.
Within this category, there are three levels of fault, ranked according to seriousness:
“Faute simple” – Simple fault could be an error or omission that could be caused by either maliciousness or carelessness. Even if it’s not as serious, the employee’s actions may have jeopardized or negatively impacted the business. In this category, employees are entitled to:
- Severance pay
- Compensation for advance notice
- Compensation for paid leave
“Faute grave” – Grave fault occurs when an employee engages in a behavior that contributes to a toxic work environment, making it untenable for them to remain as an employee any longer. This could be done unintentionally or maliciously. For instance, sexual harassment or battery can be grounds for immediate termination. In such cases, the employee has no right to expect compensation for advance notice and dismissal.
“Faute gross” – Gross fault occurs when an employee intentionally and willfully attempts to harm the employer or other employees. In this case, the employer must demonstrate intentionality. An employee terminated for gross fault may not expect compensation for advance notice and dismissal, but they may still be given paid leave.
External poor behavior
Additionally, there may be other personal reasons for termination that fall outside the auspices of disciplinary, including:
- Improper personal behavior
- Disagreements between the employee and others
- A lack of results
- Professional ineptitude
Under French law, economic reasons must satisfy one or more of the following conditions:
- Not inherently tied to the employee
- The company is experiencing real and serious economic difficulties
- The company is introducing technology that will impact how the job is performed or remove its role altogether
- The company is reorganizing to maintain competitiveness
Termination procedures and unemployment benefits France offers
Even if you’re legally justified in terminating a French employee, there’s a proper procedure that must be followed. Failure to do so could result in a lawsuit.
So, if you believe that you have a just reason to let an employee go, be sure to follow the steps.
1. A preliminary interview summons
If you plan on dismissing an employee, you must first have them come to an interview, during which you’ll explain the reasons for your decision and receive their explanations or rebuttal. This interview is mandated by French law to occur before a person may be let go.
If the termination is due to disciplinary reasons tied to personal behavior, it must be sent at least within two months of the incident(s). If it’s not for personal reasons, then there’s no deadline for the summons.
The letter must contain:
- A notification in writing that states a real and serious cause for termination.
- The notification must be either personally delivered or have a recorded delivery to confirm the date.
- The summons must state the time and place of the meeting; the date must be at least five working days after the employee has received the letter.
- Notification must make the employee aware that they can be accompanied by a fellow employee or a person pre-approved by the Prefect.
2. French employment law notice period
Almost every employee that’s to be dismissed is entitled to a notice period in France. The only instances where this is not the case are if the employee is dismissed for reasons of gross misconduct, negligence or incapacity.
During this period, the employee may continue to work for the company and receive the same compensation until the conclusion of the work relationship. The length of this period is contingent upon the employee’s seniority status:
- One month’s notice for six to 24 months of employment
- Two months’ notice for 24-plus months of employment
- Depends on company practice or collective agreement for more than six months
The notice period starts after the letter of dismissal has been received.
That said, if an employee wishes to, they may request to be released from work during the period—though an employer isn’t required to acquiesce. If the employer does comply, the two parties will agree upon an end date, after which the employer is freed from paying wages or compensation.
3. Pre-dismissal meeting
During this meeting, an employer is obliged to explain the reasons why the employee is being let go. It’s important that these assertions are backed by documentation. Along these lines, the employer must note and consider the employee’s explanations for the behavior.
After the meeting has concluded, the employer can then determine whether the employee will be dismissed.
4. The certified letter of dismissal
Once the employee has been duly notified of their pending dismissal status, the employer must then send a follow-up letter stating the grounds for dismissal. This letter must be sent by registered mail to ensure that the employee received it.
The employee is required to acknowledge that they have received the receipt. From there, they have the right to dispute the alleged unfair dismissal before an employment tribunal. Following this, the employer must perform the following actions:
- Provide the employee with a certificate of employment, receipt acknowledging full settlement, and certificate for the State Unemployment Fund (Pôle Emploi)—to ensure that the employee may apply for unemployment insurance.
- Send the State Unemployment Fund a copy of the employee dismissal certificate.
- Declare to the administration the age of the employee, the number of dismissals of employees 55 or older, and the total amount paid to employees because of dismissal.
5. Calculate severance pay
After the notice period has ended, an employee is likely entitled to severance so long as they have at least eight months’ tenure. However, if misconduct or negligence are the reasons for the dismissal, then they’re not eligible, regardless of the employee’s seniority.
Severance payments vary, but there are minimum thresholds. How the severance is calculated should correspond to the most advantageous outcome for an employee. Typically, this is done in one of two ways:
- The monthly average of the 12 months prior to the termination of the contract or the monthly average of all months prior to the termination.
- If the length of service is less than 12 months, a third of the monthly salary for the three months prior to the termination of the contract.
Keeping you informed of French employment laws
No matter what your business or industry, terminating an employee isn’t easy, nor is it always clear-cut. The proper protocols become even more muddied when you’re a global employer and have to factor in termination laws from different countries.
One way to ensure compliance with French employment regulations is by finding an HR partner with local expertise, such as a global employer of record, sometimes referred to as an international PEO provider. An employer of record in France can help guide you as you navigate the intricacies of French employment law, especially in a termination situation.
Want to learn more? Reach out to speak with a global solutions advisor today.