Mistakes entrepreneurs make when hiring employees in France: what is important to know?

When entrepreneurs open business in France, the issue of hiring employees becomes one of the key tasks. However, ignorance of the specifics labor legislation can lead to serious consequences, including fines, lawsuits, and even the threat of business closure. Let's look at three common mistakes employers make and how to avoid them.

Mistake 1: Incorrect choice of employment contract type

There are several types in France employment contracts, the most popular of which are long-term (CDI) and short-term (CDD). A mistake that entrepreneurs often make is to use a short-term contract in situations where a long-term one is required.

Why is this important?

French law automatically reclassifies short-term contracts as long-term if the employment does not meet the established requirements. This results in additional obligations of the employer to the employee.

How to avoid?

• Use CDD only in strictly regulated situations (e.g. temporary projects or seasonal work).
• When hiring, consult with an employment lawyer.

Mistake 2: Unregistered hiring ("black work")

Many entrepreneurs mistakenly believe that working "under the table" at the initial stages will allow them to save on taxes and administrative procedures. However, the risks of such actions are extremely high.

Consequences:

• Fines of up to 45,000 euros for each unregistered employee.
• Criminal liability, including imprisonment (in some cases up to 5 years).
• Closure of an enterprise by administrative decision.

Example:
A case from Marseille: in a construction company, out of 344 workers, only 72 were officially employed. The company received a large fine and a ban on participation in tenders.

How to avoid?

• Always enter into a formal contract with the employee.
• Sign acts or agreements even for one-time payments.
• Regularly check that your employment relationship complies with the law.

Error 3: Unverified employee documents

Hiring employees with inappropriate visas or residence permits is another common mistake. For example, passeporte tallent status may only allow employment in the academic or scientific field, but not in commercial organizations.

Why is this a problem?

The employer is obliged to check that the employee's documents comply with the requirements of the position. Otherwise, he may be held liable.

How to avoid?

• Check visas and residence permits before signing a contract.
• If necessary, initiate the process of changing the employee's status at the prefecture.
• Enlist the help of a specialist who can verify the compliance of documents.

Why is it important to consult a lawyer?

French labor law is focused on protecting employees. Even minor violations can have serious consequences for a business. Legal advice will help you avoid common mistakes and build transparent relationships with employees.

What to do if mistakes have already been made?

• Contact a lawyer to analyze the situation.
• Consider reaching a settlement agreement with the employee.
• If the case goes to court, don't stop at the first instance - the appellate court often reviews decisions in favor of employers.

Video with a labor lawyer

We discussed this topic with lawyer Olga de Vek, who specializes in labor law.

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If you are planning business in France or have already encountered difficulties in hiring, contact us for advice. We will help you prepare the necessary documents.

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Conclusion

By avoiding three key mistakes, you will reduce risks and be able to focus on business development, not litigation. French legislation is complex, but with competent support you will be able to successfully operate within the legal framework and minimize risks.

Have you had any difficulties with hiring in France? Share your experience in the comments!