A More Flexible Labor Market

With overtime hours now tax-exempt and the introduction of more flexible conditions for hiring and firing employees, the French labor market has been evolving with the passing of numerous reforms.
 

Incentives supporting overtime hours

Greater freedom to negotiate working hours

Employer confederations and trade unions are free to hold negotiations at a company level concerning working hours, which ensures that a pragmatic approach can be taken according to the needs of different companies. Specifically, they can set the overtime hour quota, the hours exceeding this quota, and the corresponding statutory rest days for employees through a basic company agreement.

The limit for overtime hours, previously fixed at 220 hours per year, can now be determined by collective agreement within the limits defined by European Union regulations (48 hours per week).

Companies can now raise the working hours of managers or independent salaried employees working under the “forfait jours” (fixed days) system (around 40% of the workforce) through a collective agreement from 218 to 235 working days, due to the optional buyback of days off.

Enabling retailers to open on Sundays

The Act of August 10, 2009 extended the possibilities for working on Sundays in tourist and spa areas as well as in large urban commercial areas in and around Paris, Lille and Marseille.

Modernized employment procedures

• New hiring rules introduced: the maximum trial period has been increased by two months, to four months for blue collar workers and employees, and to eight months for managers.
• New form of contract termination procedure created, the “rupture conventionnelle” (termination by agreement) which enables the employer and employee to terminate the contract amicably or by mutual consent. The procedure is exempt from tax and social security contributions (up to two years of remuneration).