French Social Law in 2026: key reforms impacting employers and payroll
As of 2026, France has enacted significant revisions to social and employment law through the “French Social Security Financing Act (LFSS) for 2026”. These changes affect leave entitlements, payroll rules, health and safety procedures, retirement provisions, and social charges — many of which are already in force or will come into effect throughout the year.
As of 2026, France has enacted significant revisions to social and employment law through the “French Social Security Financing Act (LFSS) for 2026”. These changes affect leave entitlements, payroll rules, health and safety procedures, retirement provisions, and social charges — many of which are already in force or will come into effect throughout the year.
The LFSS (French Social Security Financing Act) for 2026 was published in the Journal officiel on 31 December 2025 after partial review by the Constitutional Council. Some measures took effect from 1 January 2026, while others will be rolled out later in the year.
New Birth-Related Benefits
Additional birth leave for employees
A new, paid additional birth leave of up to two months per parent has been established for children born or adopted from 1 January 2026. Although the law sets its start at 1 January, practical implementation requires decrees; thus, access will begin 1 July 2026.
Birth benefits for self-employed
Similarly, self-employed workers can claim supplemental daily birth allowances (conditions & amounts to be defined by decree).
Payroll & Employer Contributions
Increase in contribution on termination payments
The employer contribution rate on severance and retirement indemnities rises from 30 % to 40 % as of January 1, 2026.
Overtime exemption extended
The flat reduction on employer social contributions for overtime hours — previously reserved for companies under 250 employees — now applies to all companies with 20+ employees.
Unified reduction mechanism (RGDU)
The previous general and specific reduced contribution schemes merge into a single general degressive reduction (RGDU). This may result in lower reductions when minimum industry wages are below the SMIC (French minimum wage).
Senior employment negotiation sanctions
For companies with 300+ employees, failure to negotiate on senior employment triggers a malus on employer contributions.
Health, safety & work stoppages
Stronger penalties for undeclared work
From 1 June 2026, social security authorities will increase penalties for undeclared work — a 35 % increase in assessments, with higher increases for aggravated cases.
Limitation on medical work stoppages
Starting 1 September 2026, prescribed work stoppages will be capped by decree, typically not less than 1 month for a first prescription. Physicians must justify duration and reasons when prescribing.
Pre-Return medical visits
The médecin-conseil can now request a pre-return-to-work medical visit after 30 days of absence (down from 3 months).
Retirement rules
Suspension of the 2023 pension reform
The LFSS 2026 suspends the previous pension reform, setting the legal retirement age at 64 for those born on or after 1 January 1969 and adjusting the required quarters for full pension — effective for pensions from 1 September 2026.
Reform of cumulative work and retirement options
From 1 January 2027, rules for combining pension receipts with employment income are overhauled, distinguishing three situations based on age and pension status.
Other Key social measures
Higher social charges on capital income
The Contribution Sociale Généralisée (CSG) rate on capital income increases from 9.2 % to 10.6 %, affecting dividends, financial gains, and other investment income.
Urgent social security adjustments
Various refinements will be set by upcoming decrees, including mechanisms related to social security collection privileges, procedures for occupational diseases, and accident compensation rules.
In Summary
The LFSS for 2026 introduces a broad set of changes with significant implications for employers and workers in France — especially in payroll tax treatment, birth-related benefits, work-absence regulation, retirement planning, and social contribution structures. Many changes are already in effect, while others will be phased in throughout 2026 as implementing decrees are published.
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