Transferring an employee to France without setting up a permanent legal presence may seem complex, but there is an effective solution: the status of a company without an establishment in France (ESEF). Want to know more?
Leverage the ESEF Status to Simplify Procedures and Minimize Risks
The status of a company without an establishment in France (ESEF) allows a foreign company to hire and manage employees in France without having to register a local legal entity. A foreign company can thus employ staff in France and enter the French market without a permanent structure (subsidiary or branch) and with minimal legal and administrative obligations.
If you need to transfer one of your employees, to develop your business in France or at the employee’s request (e.g., an expatriate employee wishing to return to France while keeping their job), the ESEF status is particularly suitable because it offers the following advantages:
- Administrative simplicity: The ESEF status eliminates the need to create a complex legal structure just to have one or two employees in France. Only social declarations and payment of contributions are required.
- Cost savings: All costs related to the creation and operation of a subsidiary or branch in France are avoided (e.g., registration fees).
- Flexibility: This is the ideal solution for short-term assignments or to assess opportunities in France before establishing a more permanent presence.
Register Your Company and Employee with URSSAF
For an employee to be legally considered as working in France, they must be declared with URSSAF, and your company must register via the National Center for Foreign Firms (CNFE).
For example, within 8 days prior to hiring an employee, the employer must file a preliminary declaration of employment (DPAE) with URSSAF. This step allows the declaration and payment of social contributions for employees working in France.
The employer must also join a supplementary pension fund and offer collective health insurance coverage to their employee. In some cases, they will also need to join a provident fund (to protect employees against risks related to death, incapacity, invalidity, and dependency) or a CIBTP fund (special fund dedicated to the protection of construction sector employees). They must also subscribe to an occupational health service.
Comply with French Labor Law Obligations
In France, employee rights are strictly regulated. When transferring your employee to France, their employment contract must, among other things, comply with:
- The legal working hours (35 hours per week),
- The minimum wage (SMIC or applicable collective agreements),
- Paid leave rights (5 weeks per year),
- Health and safety at work.
Pay Social and Tax Contributions
Although the ESEF status exempts foreign companies from many formalities and taxes, you must fulfill certain mandatory fiscal and social obligations. Specifically, this involves:
- The declaration and payment of social contributions,
- Managing income tax withholdings for employees.
If you are considering transferring an employee to France, it is advisable to work with experienced professionals who can help you navigate administrative complexities and ensure compliance with French legislation. Ready to take the step? Do not hesitate to contact us to benefit from our expertise and personalized support to take advantage of the ESEF status and transfer an employee to France with peace of mind.
