FRANCE GUIDE

EMPLOY IN FRANCE WITH EASE

  • Access and hire global talent & deploy them anywhere in the world
  • Remove restriction from only hiring from local markets
  • Enter any international market without the requirement of opening a local entity

Expanding into France – which is characterised by an exceptionally talented and entrepreneurial workforce, intricate employment and tax laws, a robust infrastructure network, and leading sectors in manufacturing and technology, agriculture, energy, transport, and tourism – can bring excitement to the possibilities, but also significant stress to ensuring the entity with the country’s rigorous legal structures and laws. Ensuring compliance without sufficient knowledge of the country’s laws also adds stress to getting your new entity off the ground and ready to test new markets. Going at it without the proper support can increase the costs, time and risks involved.

Regardless of your goal, global expansion is a step to make for any business. The opportunities that can come with an expansion can be incredibly exciting as well as intimidating and confusing, especially when you consider all of the registration procedures that need to be done and the documentation required. This can be worked through more efficiently and cost-effectively with the support of an International Professional Employer Organization (PEO) such as Bradford Jacobs, especially through our Employer of Record (EOR) framework. This can be best utilized when businesses are just beginning their expansion process and require more information before incorporating an entity and fully establishing themselves in that market.

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France – The Economy

The economy of France is a highly developed, market-oriented economy. It is the world’s seventh-largest economy by 2022 nominal figures (USD 2.77 trillion GDP) and the tenth-largest economy by PPP. It is the 3rd largest economy in Europe, after Germany’s and the United Kingdom’s economies.

France has a diversified economy, dominated by the service sector (which in 2021 represented 70.16% of its GDP), whilst the industrial sector accounted for 16.78% of its GDP. The primary sector accounted for the remaining 1.63%. 

In 2020, France was the largest Foreign Direct Investment recipient in Europe and Europe’s second-largest spender in Research and development.

It was ranked among the 10 most innovative countries in the world by the 2020 Bloomberg Innovation Index, as well as the 15th most competitive nation globally, according to the 2019 Global Competitiveness Report, and is the fifth-largest trading nation in the world (second in Europe after Germany). France is also the most visited destination in the world and the European Union’s leading agricultural power.

Paris is a leading global city with one of the world’s largest city GDPs. It ranks as the first city in Europe (and 3rd worldwide) by the number of companies classified in Fortune’s Fortune Global 500. Paris produced €738 billion (or US$882 billion at market exchange rates) or around 1/3 of the economy of France in 2018, while the economy of the Paris metropolitan area — the largest in Europe with London—generates about 1/3 of France’s GDP or around $1.0 trillion.

Paris was ranked as the 2nd most attractive global city in the world in 2019 by KPMG. La Défense, Paris’s Central Business District, was ranked by Ernst & Young in 2017 as the leading business district in continental Europe and fourth in the world. The OECD is headquartered in Paris, the nation’s financial capital. The other major economic centres of the country include Lyon, Toulouse (the centre of the European aerospace industry), Marseille and Lille.

SMEs in France

In France, SMEs in the ‘non-financial business economy’ generate 55.8% of value-added and 64.1% of employment, which is roughly on par with the respective EU averages of 56.4% and 66.6%. Micro-firms create more employment (at 31.5%) and contribute more to value added (at 24.1%) than the average for EU micro-firms.

French SMEs are also more productive than the EU average. Value added per person employed is 21.2% higher in France, at €54,000 against the EU average of €44,600.

SMEs in France employ an average of 3.4 people, slightly fewer than the EU average of 3.9.

Country
France (French Republic)
Capital
Paris
No. of Regions
18 administrative regions
Principal Cities
Paris, Marseille, Lyon, Toulouse, Nice, Nantes, Strasbourg, Montpellier, Bordeaux and Lille.
Language
French
Local Currency
Euro (EUR)
Major Religions
Catholicism (47%) - No religion (42%) - Islam (4%) - Protestantism (2%)
Date Format
dd/mm/yyyy
Time Zone
CET (UTC+1 /+2 with DST)
Country Dial Code
+33
Population
68.05 million (December 2022)
Border Countries
In Europe: Belgium, Luxembourg, Germany, Switzerland, Italy, Monaco, Spain, Andorra, and the UK through the Channel Tunnel.

In the Americas: the Netherlands, Suriname, and Brazil via its overseas territories in French Guiana and Saint Martin.
Tax Year
1 January – 31 December (calendar year)
VAT &
20%
National Minimum Wage
From 1st January 2023: EUR 1,709.28 gross/month (EUR 1,353.07 net/month), or EUR 11.27/hour gross (EUR 8.92/hour net).
Taxpayer Identification Numbers
French TIN (numéro fiscal de référence), SIREN number (for businesses), and National Registration Number (INSEE code or the Social Security number).
GDP by sector
services 70.16% - industry 16.78% - agriculture 1.63% (2021)
Main imports
Cars, refined petroleum oils, mobile phones and computers – Total imports: USD 714.1 (2021)
Main exports
Aircrafts, vehicles, pharmaceutical products, food products (wine), hydrocarbons and electronic components– Total exports: USD 584.77 billion (2021)
Main trading partners
Exports partners: Germany, Italy, Belgium, Spain and the United States of America (44.9% of total exports of France in 2021).

Import partners: Germany (16%), China (9%), Italy (8%), Belgium (7%), the US (6%), Spain (6%), the UK (5%) and the Netherlands (5%).
Government Type
Unitary semi-presidential republic
Current President / PM
President: Emmanuel Macron (May 2017)

PM: Élisabeth Borne (May 2022)

Expanding into France: Economic Sectors

France focuses its economy on the following key sectors, which all have a significant impact on the country’s GDP:

  • Energy – One of the major industries in France is the energy sector. France’s leading electricity company, Electricite de France (EDF), is the largest utility company in the world. The energy company listed on the French Stock Exchange has the state as the majority shareholder. In France, renewable energies have grown steadily in the last few years to reach 11.7% of primary energy consumption and 25.3% of gross final energy consumption in 2019. Renewable energies sustain the equivalent of 60,000 full-time jobs. The most developed renewable energies are still wood energy and hydropower, but onshore wind farms and heat pumps are two sectors that have progressed the most in the last few years, with offshore wind farms currently under development. Energy production in France is primarily based on nuclear energy, which accounts for 78% of the country’s electricity. The increased reliance on nuclear energy enables France to boast one of the least carbon dioxide emission levels in the developed world. The future of France’s energy industry lies in renewable energy, especially since the French National Assembly passed a law in July 2015 requiring that 40% of the nation’s electricity be produced from renewable energy sources by 2030.
  • Agriculture – Agriculture was traditionally the primary economic activity in France before the Industrial Revolution in the 19th century. France is recognized as having the sixth-largest agricultural production in the world and the largest in the European Union. France is also the world’s second-largest exporter of agricultural products and is only surpassed by the United States. Huge wheat farms are located in the country’s northern region, while southern France is renowned for its vineyards and horticultural products. France is the largest producer of sugar beets and the second-largest producer of cheese and wine worldwide. Western France is the main producing region of dairy products, poultry, apples, and pork. The vast majority of agricultural exports are destined for member states of the European Union, which receive 49% of all agricultural exports from France. The agricultural industry in France has the privilege of receiving significant support from the EU in the form of subsidies, which amount to more than $11 billion. In recent years, the industry has implemented numerous reforms due to international agreements, including the General Agreement on Tariffs and Trade.
  • Tourism – France is the most popular destination in the world, receiving about 85.7 million tourists annually. This massive tourist traffic also means France is ranked fifth in the world regarding tourist spending. The tourism industry is a crucial economic pillar in France, injecting over $70 billion into the country’s GDP. Of this total, 70% comes from domestic tourists, while the remaining 30% comes from international tourists. The industry represents 9.7% of the country’s GDP. France’s popularity among tourists is attributed to a wide array of prime tourist attractions across the country.
Start a business in France
Expanding into France
 
  • Manufacturing & Technology – Manufacturing is among the largest industries in France, accounting for billions of dollars in the country’s GDP. The country is recognized as the fourth largest automobile manufacturer in the world and is home to two of the largest automobile manufacturers in the world: Peugeot and Renault. France is also renowned for its aerospace sector, dominated by Airbus, the world’s leading aircraft manufacturer. Technology is another important economic pillar in the country’s economy. France is ranked among the most technologically advanced countries in the world, and the country has an ideal environment for technological research and innovation. This environment has led to the growth of some of the largest technology companies in the world.
  • Transport – Transport in France is a multi-billion industry, and some of its key players are major global companies. France has one of the world’s densest networks of roads and railways, interconnecting the nation’s cities. The French cities of Paris, Marseille, and Lyon have extensive metro systems, while Rennes, Lille, and Toulouse have light metro systems. The railway network in France stretches 18,580 miles, most of which is under the operation of SNCF (French National Railway Corporation). However, the largest company in France’s railway transport is Alstom, based in Saint-Ouen, but it has operations all over the globe and over $37 billion in assets. France has one of the highest concentrations of airports, with a total of 478 airports across the country. The busiest airport in the country is Charles de Gaulle Airport in Paris, which records about 60 million passengers each year, making it the fifth busiest in the world. Air France is the French national carrier and flies to 150 destinations on all six continents worldwide.

Labour Laws in France

French employment laws are based on a combination of the French Labour Code, Civil Code, and Social Security Code, with considerable influence from sector-specific agreements. These are known in France as national collective agreements (Conventions Collectives Nationales, CCN). There are over 300 such agreements, and they cover more than 90% of the workforce.

Collective bargaining agreements can introduce additional benefits and entitlements, but certain statutory minimums must apply to any contract. These include:

Discrimination: According to the French Labour Code, it is illegal to punish, dismiss or exclude employees/potential employees from the recruitment process (for a job, a training position or an internship), or cause them to endure direct or indirect discriminatory measures concerning remuneration, incentive schemes, share distribution, training or redeployment programs, posting, qualification, classification, career development, mobility or contract renewal, based on their nationality, ethnic or racial origin, gender, sexual orientation, morals, name, age, marital status, religious beliefs, political opinions, trade union activities, physical appearance, medical condition and/or disability.

National Minimum Wage: EUR 1,709.28 gross/month (EUR 1,353.07 net/month), or EUR 11.27/hour gross (EUR 8.92/hour net). Employers cannot offer less, and employees cannot receive less in their work.

Working hours: Hours are generally 35 per week and must not exceed 44 hours on average over 12 weeks to a maximum of 48 hours. The French Labour Code stipulates that any hours over 35 per week, or 1,607 per year, are overtime.

Breaks: Workers are entitled to a minimum 20-minute break after six hours of work – collective agreements can allow for more. Employees must have a minimum of 11 hours’ unbroken rest between daily shifts, not work six days in a row and have 35 hours of consecutive rest every seven days.

Overtime: Based on a working week of 35 hours, the first eight hours earn a premium of 25% on the basic hourly rate and 50% extra for each hour exceeding 43. Paid leave is mandatory if employees work more than 220 hours overtime annually in addition to overtime payments.

Notice Periods: These are generally governed by the French Labour Code and collective agreements, the latter particularly applying when employment is less than six months. Statutory notice is one month between six months and two years’ service and two months for more than two years’ service.

Compliance Highlights

The website www.impots.gouv.fr gives you access to all the official online services of the General Directorate of Public Finance (DGFiP). This is a site of the Ministry of Economy and Finance.

The General Directorate of Public Finances (DGFiP) services are present throughout the territory, as close as possible to its users and partners. Installed in the Public Finance centres, these services belong to different categories, which reflect the diversity of the missions carried out by the DGFiP and its audiences. These include:

  • Individual tax services (SIP)
  • Business tax services (SIE)
  • The treasuries
  • Property Tax Centers
  • “Registration” poles
  • Land registration services

The Ministry of Labour draws up and implements French occupational health and safety policy and manages cooperation with the social partners in the Conseil d’orientation sur les conditions de travail (COCT) [Steering Committee on Working Conditions].

Collective Agreements in France

Individual employers, employer federations, trade unions and organisations are part of Collective Bargaining Agreements (CBAs) that lay employees’ employment terms and conditions framework. They generally cover specific sectors or industries. Foreign companies with no legal entity in France but employing staff registered with social insurance and tax authorities must still adhere to applicable collective agreements. Failure to comply risks fines and other sanctions compromising your business activity.

Collective agreements are binding on employers, regardless of whether the employer is a member of the organisation that drew up the agreement or whether the employee is a union member.

France has more than 300 collective agreements, also known as national collective agreements (Conventions Collectives Nationales, CCN). These agreements cover more than 90% of the workforce. Collective agreements generally enhance the minimum requirements of the French Labour Code and, in some cases, introduce guarantees that the Code does not cover.

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