PEO in France: A Guide to Co-employment

 PEO in France: A Guide to Co-employment



PEO in France, or Professional Employer Organization, is a growing trend in the world of business. It refers to a service that allows companies to outsource their human resources, payroll, and other administrative tasks to a third-party provider. In France, PEO is commonly known as Employer of Record, and it has become a popular option for businesses looking to expand their operations in the country.


What is PEO?


An Employer of Record (EOR) is a company that is legally responsible for all aspects of employment for its clients’ staff. This means that the EOR is the official employer, responsible for payroll, benefits, taxes, and compliance with labor laws, while the client company maintains full control over the employees’ daily work activities.


In France, the EOR is known as a “société de portage salarial” or a “société de gestion administrative du personnel” (SGAP). The SGAP acts as the employer for the employees, allowing the client company to benefit from the expertise of the SGAP in HR and payroll management while focusing on its core business activities.

Benefits of using an EOR in France

Using an EOR in France can offer several benefits to a company, including:


  1. Faster market entry: By using an EOR, a company can quickly establish a presence in France without having to set up a legal entity, which can be a time-consuming and costly process.

  2. Compliance with French labor laws: The SGAP will ensure that the company is in compliance with all French labor laws and regulations, which can be complex and time-consuming to navigate.

  3. Access to local expertise: The SGAP will have a thorough understanding of the local employment market and can provide valuable insights into local employment practices, culture, and regulations.

  4. Cost savings: Outsourcing HR and payroll tasks to an EOR can result in cost savings for the company, as it eliminates the need to hire and train staff for these tasks.

 

Relation between Co-employment and PEO


Payroll management in France can be complex and time-consuming, particularly for foreign companies that are not familiar with the local regulations. The SGAP will take care of all payroll-related tasks, including calculating salaries, deducting taxes and social security contributions, and ensuring that all payments are made on time.


In France, the payroll process is regulated by several laws, including the Labor Code, the Social Security Code, and the Tax Code. These laws dictate how much employees should be paid, what benefits they are entitled to, and how much tax and social security contributions must be deducted from their salaries.


When using an EOR in France, the SGAP will ensure that the company is in compliance with all of these laws, making the payroll process much simpler and more streamlined.


Payroll outsourcing is a common practice in France, particularly for small and medium-sized businesses that do not have the resources to manage payroll in-house. By outsourcing payroll to an EOR, companies can focus on their core business activities, while ensuring that their employees are paid accurately and on time.


The SGAP will take care of all aspects of payroll management, including calculating salaries, deducting taxes and social security contributions, and ensuring that all payments are made on time. They will also provide employees with payslips and ensure that all necessary paperwork is filed with the relevant authorities.


Conclusion


PEO, or Employer of Record in France, is becoming an increasingly popular option for businesses looking to expand their operations. In addition to payroll outsourcing, the SGAP can also provide other HR-related services, including recruitment, onboarding, and training. This can be particularly valuable for companies that are new to the French market and may not have the resources or expertise to manage these tasks in-house.


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