A French company planning to dismiss 2 to 9 employees for economic reasons within 30 days must follow the procedure for a small collective redundancy. Having fewer than 50 employees does not remove the duties to establish economic grounds, consult the CSE where applicable, apply selection criteria and search for redeployment.
For a foreign parent company, a global restructuring decision must be translated into a legally supported French process. The French entity’s headcount, the group structure and the proposed number of dismissals should be checked before individual departure dates are announced.
This guide covers employers and French subsidiaries outside judicial reorganisation or liquidation. Projects involving protected employees or particular group structures require additional assessment.
Does a company with fewer than 50 employees need a PSE?
A statutory job-protection plan, known as a plan de sauvegarde de l’emploi or PSE, is required when a company with at least 50 employees proposes at least 10 economic dismissals within 30 days.
A company below that headcount threshold is not subject to that requirement merely because it dismisses several employees. However, the applicable framework and any relevant collective arrangements must first be confirmed.
| Proposed economic dismissals within 30 days | Procedure to assess |
|---|---|
| 1 | Individual economic dismissal |
| 2–9 | Collective redundancy involving fewer than 10 employees |
| 10 or more | A different collective procedure; the PSE requirement depends on the applicable headcount and legal framework |
Earlier and planned redundancies should also be reviewed. Successive waves cannot safely be treated as unrelated without considering the rules on counting dismissals and the actual restructuring project.
What economic grounds must the French employer demonstrate?
The employer must connect a job elimination, job transformation or an employee’s refusal of a change to an essential contractual term to a recognised economic ground. These include economic difficulties, technological changes, reorganisation necessary to safeguard competitiveness, or cessation of business.
A desire to reduce costs or implement a headquarters decision does not, by itself, establish the legal ground.
Can a decline in turnover justify redundancies?
The Labour Code identifies periods for establishing a significant decline in orders or turnover against the corresponding period of the previous year:
- Below 11 employees: at least one quarter.
- From 11 to fewer than 50 employees: at least two consecutive quarters.
Other indicators, such as operating losses or deterioration in cash flow, may also be relevant. The employer must document the circumstances and the connection with the jobs affected.
Can a profitable foreign group restructure its French subsidiary?
A profitable international group is not automatically prevented from making economic dismissals in France. Equally, poor global results do not automatically justify dismissals in its French subsidiary.
Where the employer belongs to a group, economic difficulties, technological changes and the need to safeguard competitiveness are assessed within the relevant business sector of group companies established in France, subject to the statutory rules, including fraud. Consolidated worldwide figures alone may therefore fail to address the required assessment.
When must the employer consult the CSE?
For a project involving 2 to 9 economic dismissals, the employer must inform and consult the social and economic committee, or CSE, where applicable.
The consultation documents should explain the economic reasons, proposed number of dismissals, professional categories affected, selection criteria, timetable and measures intended to limit dismissals and facilitate redeployment. Relevant health, safety and working-condition consequences should also be addressed.
The CSE has no more than one month from the first meeting at which it is consulted to give its opinion. If it does not give an opinion within the statutory period, it is deemed to have been consulted.
CSE establishment obligations depend on statutory threshold and duration rules. If no CSE exists, the employer should verify whether elections were required and properly organised, and whether a valid procès-verbal de carence records their outcome. Absence of representatives should not simply be assumed to remove an unfulfilled election obligation.
For wider support on employee representation and social dialogue, see HR consulting and labour relations.
Can the employer choose which employees are made redundant?
The employer should identify the organisational changes and relevant professional categories before naming the employees concerned. Where a choice is necessary, selection must follow the applicable rules.
In the absence of applicable collective provisions, statutory criteria include family responsibilities, length of service, circumstances making re-employment particularly difficult, and professional qualities. The employer may give greater weight to a criterion while taking all statutory criteria into account.
Professional categories should reflect functions of the same nature requiring common vocational training. A team label or product line is not automatically a valid separate category.
The geographical scope also needs assessment. It may be set by a collective agreement; without such an agreement, it cannot be smaller than each relevant employment zone containing establishments affected by job reductions. Selection therefore does not necessarily extend across the entire company.
Document the categories, scope, scoring method and supporting evidence before applying the ranking.
Must the employer offer another job before dismissal?
The employer must meet its adaptation and redeployment obligations before proceeding with economic dismissal.
The search covers available jobs in France within the company and relevant group companies whose organisation, activities or operating locations allow staff interchange. It is not limited to the department losing positions.
Offers must be written and precise. They may be made individually or through a circulated list under the statutory conditions. For a circulated list, the ordinary minimum application period is 15 clear days; that specific rule should not be presented as a universal deadline for every individual offer.
Keep records of enquiries, available vacancies, offers and employee responses. Recruitment into a potentially suitable position around the same time should be checked against the redeployment search and the explanation of the restructuring.
What happens at each employee’s preliminary interview?
Each affected employee must be invited to a preliminary interview by registered letter or hand delivery against receipt. At least five working days must separate presentation or delivery of the invitation from the interview.
The employer explains the proposed economic dismissal and the applicable support mechanism. The employee may be assisted by a colleague or, where the company has no employee representatives, by an external employee adviser under the applicable rules.
Protected employees require additional safeguards, including labour inspector authorisation where required.
Is the CSP compulsory for a French subsidiary of a foreign group?
Do not determine this from the French subsidiary’s headcount alone. The relevant company or group framework must be assessed to establish whether the employer must offer the professional security contract (contrat de sécurisation professionnelle, CSP) or redeployment leave (congé de reclassement).
Where the CSP applies, the employer offers it during the preliminary interview. The employee normally has 21 calendar days to decide. Acceptance ends the employment contract at the expiry of that period, subject to special rules for protected employees.
The economic reason must be communicated in writing no later than acceptance. CSP acceptance does not prevent an employee from challenging the economic basis of the termination.
The scheme provides France Travail support and benefits subject to eligibility and scheme rules. The employer should calculate its contribution and any remaining employee entitlements rather than assuming that acceptance removes all notice-related costs.
When can the dismissal letter be sent?
For collective economic dismissals involving fewer than 10 employees, the minimum interval after the scheduled preliminary interview is seven working days. The 15-working-day interval applicable to an individual economic dismissal of an executive does not apply merely because an executive is included in this collective project.
The notification must state the economic grounds and required information, including the priority for rehiring and its conditions. If a notification is sent while the CSP decision period is still running, it must preserve the employee’s opportunity to accept the scheme.
The employer must also inform the competent administration within eight days of sending dismissal letters, using the applicable reporting process.
Information note: seven or fifteen working days for executives?
The distinction depends on whether the economic dismissal is individual or collective.
Under Article L1233-15 of the French Labour Code:
- For an individual economic dismissal, the minimum period is seven working days, extended to fifteen working days for an executive (cadre) covered by the statutory provision.
- For a collective economic dismissal involving 2 to 9 employees within 30 days, the minimum period is seven working days for each employee, including executives.
Sending a separate dismissal letter to each employee does not turn a collective redundancy into an individual dismissal.
The period runs from the scheduled date of the preliminary interview to which the employee was invited. Where the CSP applies, the notification must also preserve the employee’s separate 21-calendar-day decision period.
Legal reference: Article L1233-15 of the French Labour Code
How long does a small collective redundancy take in France?
There is no reliable universal six-week timetable. Preparation, CSE consultation, redeployment, individual interviews and support-scheme decisions must be coordinated.
| Stage | Timing point to plan |
|---|---|
| Preparation | Verify thresholds, grounds, categories and collective provisions |
| CSE consultation | Opinion within one month of the first consultation meeting |
| Redeployment list, where used | Normally at least 15 clear days for applications |
| Preliminary interview | At least five working days after presentation or delivery of the invitation |
| CSP decision, where applicable | Normally 21 calendar days |
| Dismissal notification | At least seven working days after the scheduled interview, with CSP coordination |
| Administration reporting | Within eight days of sending dismissal letters |
Some work can run alongside other stages; deadlines should not simply be added together. A contractual or collective notice period may affect the final departure date where the employee does not accept the CSP.
What costs and risks should employers anticipate?
Budgeting should cover severance entitlements, notice or support-scheme contributions, accrued leave and any outstanding remuneration. Review the collective bargaining agreement and employment contracts.
A non-compete clause may create a separate compensation obligation. Any waiver must comply with the applicable wording and deadlines, taking the termination mechanism into account. See non-compete clauses when an executive leaves.
Potential disputes concern insufficient economic grounds, redeployment failures, selection criteria or procedural defects. Consequences depend on the breach; compensation rules are not a single flat range for every employee. Specific grounds of nullity can also apply.
Employers should preserve the evidence supporting each stage and verify the applicable claim deadlines rather than assume that every dispute has an identical time limit.
Planning redundancies in your French company?
A secure project starts before employees are selected or departure dates committed to. Economic documentation, CSE consultation, redeployment, selection and individual communications should form a consistent process.
Eve Domaniewicz advises companies in French and English on employment law and HR matters relating to their activities in France. Learn more about legal and HR support for SMEs and international companies.
Eve Domaniewicz is a French employment lawyer. A former Legal Director and HR Manager, she advises SMEs and French subsidiaries of international groups on economic redundancies, from assessing the legal grounds to CSE consultation, employee selection and redeployment obligations.
Schedule an appointment now with Eve Domaniewicz’s law firm for tailored advice on your redundancy project in France.
Frequently asked questions about redundancy in France
Official references
- Economic grounds — Labour Code, Article L1233-3
- Selection criteria — Labour Code, Article L1233-5
- CSE consultation — Labour Code, Article L1233-8
- Redeployment offers — Labour Code, Article D1233-2-1
- Dismissal notification — Labour Code, Article L1233-15
- Employer obligations — Service Public
- CSP — Service Public
- Redeployment leave — Service Public
