What Severance Pay Rules Must Employers Follow in France?

Which Employees Qualify for Severance Pay?

• Have at least 8 months of continuous service with the same employer.
• Are dismissed for reasons other than gross or serious misconduct.
• Work under a permanent employment contract (CDI).
• Are terminated through redundancy, economic dismissal, or other employer-driven reasons not related to misconduct.
• In some cases, are covered by a collective bargaining agreement that grants broader rights.

Employees on fixed-term contracts (CDDs) or those resigning voluntarily do not typically receive statutory severance unless specific contractual or collective terms apply.

What Are the Legal Timelines for Paying Severance?

French employers must pay severance at the time of termination, usually included in the employee’s final payslip. Payment must be made no later than the final day of employment or by the next regular payroll cycle, depending on company practice and collective agreements.

The Labor Code does not allow delays in payment once the termination is finalized and the employee has served their notice period (if applicable). Employers must also provide a written breakdown of all termination payments, including salary, unused vacation, and severance entitlements, to ensure transparency and compliance.

What Penalties Apply if Severance Is Not Paid Correctly?

Failure to pay severance correctly or within the required timeline can expose employers to significant legal and financial risks in France, including:

• Labor court claims (Conseil de prud’hommes) initiated by the employee.
• Payment of damages and interest for wrongful dismissal or delayed compensation.
• Penalties and administrative fines if non-compliance with labor law is proven.
• Reputational harm and increased scrutiny from labor inspectors or unions.

Employers must also maintain documentation proving compliance, as failure to do so may shift the burden of proof in favor of the employee during disputes.

Does Outsourcing Employment via an EOR Change Severance Liability?

When employment in France is managed through an Employer of Record (EOR), the EOR is the legal employer and therefore assumes responsibility for severance pay and compliance with French labor law. The client company is not directly liable for severance payments, provided that the EOR is properly registered and compliant.

This arrangement helps global employers reduce legal exposure and ensures all employee rights, such as notice periods, severance, and termination documentation, are correctly managed under local regulations. However, client companies should still understand the applicable laws to make informed workforce decisions.

Be 100% Compliant in Offering Severance with Playroll

Navigating France’s labor laws can be complex, especially when it comes to termination and severance compliance. Playroll ensures your business meets every legal requirement, from correctly calculating statutory and contractual severance to making payments on time and documenting each step properly.

With Playroll as your global Employer of Record, you’ll have full confidence that your French workforce is managed in compliance with local labor laws. Our platform automates payroll and compliance updates, ensuring your employees are treated fairly while your business avoids legal risks. Partner with Playroll to simplify global employment and stay fully compliant, wherever your team works.