A recent law introduced a new employment contract (Contrat Nouvelles Embauches), which is a new category of unlimited term employment contract that allows companies with fewer than 21 employees to terminate employment more easily during the first two years of service, by registered letter with acknowledgment of receipt without having to give any justification ( the first 2 years can be thus assimilated to a 2 year probation period in lieu of generally 1 to 3 months for a normal unlimited term employment contract).
In the event of a dismissal during the first two years of employment, the employee benefits from specific rights: - a notice period of 2 weeks from the second to the sixth month of employment (no notice during the first month) and 1 month afterward;
- severance compensation (free of income tax and social charges) equal to 8% of the remuneration accrued during the contract (for a normal unlimited term employment contract, dismissal compensation is granted only when the employee has completed 2 years of service); - a fixed sum granted by the public unemployment Fund, - specific assistance from the public unemployment Service in helping the person concerned to seek an other job.
The company has to pay the public unemployment Service a charge of 2% of the remuneration accrued during the contract. After 2 years of service, the normal rules apply to dismissal: notice period, formal procedure, justification of a fair dismissal, statutory severance compensation, etc.
