You formed your French company from abroad, you hired your first employee in France, and after a few months the working relationship is not what you expected: targets missed, repeated absences, instructions ignored, or simply a hire that does not fit the business. Your first reflex is to end the contract quickly with an email from your home country. In France, that reflex can cost you more than a year of salary. Once the trial period is over, a permanent employment contract (CDI, contrat à durée indéterminée) can only be ended through one of the legal exit routes, each with its own cause, procedure and price, and every step must be documented in French employment-law terms even though you manage the company from another country. This guide explains, for a foreign founder or director living abroad, what French law demands before you may dismiss: what a real and serious cause means and how judges examine your evidence, the three exits founders constantly confuse, the dismissal procedure you must run remotely without procedural error, what the separation will cost in severance pay and notice, and how the employee can challenge you before the French labour court. It explains every French acronym on the way: CDI (permanent contract), DPAE (the hire declaration filed with URSSAF), URSSAF (the body collecting social contributions), DSN (the monthly payroll return), DREETS (the regional labour authority), and the conseil de prud’hommes (the labour court). Part I sets out the substance: the cause you need and the proof judges require. Part II sets out the mechanics from abroad: the procedure, the cost, and the dispute.

I. How French judges decide whether you had the right to dismiss: real and serious cause and proof

A. What “real and serious cause” means for your first dismissal and how judges examine your evidence

French law does not allow dismissal on general dissatisfaction. Every dismissal for personal reasons must rest on a cause that is both real and serious: real means the facts are exact, objective and verifiable rather than vague impressions, and serious means they are grave enough to make continuing the employment relationship difficult. A labour court judge checks both elements on the documents you produce, not on what you explain orally months later. That is why the dismissal letter matters so much: under Article L1235-2 of the Labour Code, “La lettre de licenciement, précisée le cas échéant par l’employeur, fixe les limites du litige en ce qui concerne les motifs de licenciement.” In plain terms, the letter, as clarified where applicable, sets the boundaries of the dispute: facts you forgot to mention in the letter generally cannot save the dismissal later, although the same article lets you clarify the stated grounds after notification, on your own initiative or at the employee’s request, within the time limits set by decree.

For a foreign employer, the practical consequence is that you must build the file before you start the procedure. Performance cases require dated objectives, measurable results, prior written warnings inviting the employee to improve, and evidence that the failure comes from the employee rather than from unclear targets or missing tools. Behaviour cases require dated records: absence logs matched against pay slips, written reminders, emails giving clear instructions and proof they were ignored. Testimonies from clients or colleagues must be written in the formal witness form French courts accept, with identity, relationship to the parties and a handwritten statement of truth. Organise this file in English for your own decisions, but every document you send the employee or the court must be in French or accompanied by a translation you can defend.

Timing is also part of the cause. If you rely on misconduct, French law imposes a strict two-month clock: under Article L1332-4 of the Labour Code, “Aucun fait fautif ne peut donner lieu à lui seul à l’engagement de poursuites disciplinaires au-delà d’un délai de deux mois à compter du jour où l’employeur en a eu connaissance, à moins que ce fait ait donné lieu dans le même délai à l’exercice de poursuites pénales.” A founder who learns of serious misconduct during a trip abroad and waits three months before acting loses the right to use that fact as a disciplinary ground. Repeat the same mistake with several old incidents and the whole disciplinary construction collapses. Diarise the date you learned each fact, keep the email or report that proves it, and start the procedure inside the two months. Where the same behaviour continues, only the recent instances can support a disciplinary dismissal, while older ones may still illustrate context for a non-disciplinary dismissal based on professional inadequacy, which follows the same dismissal procedure but a different reasoning.

Finally, remember who carries the burden: you do. The employee does not have to prove he worked well; you have to prove, with documents, that the cause stated in the letter is real and serious. An offshore manager’s testimony by video link, a spreadsheet of missed targets without signed objectives, or a dismissal letter that says “loss of trust” without facts will not survive. If your file is thin, do not launch a dismissal for cause: consider the agreed termination route described below, which avoids the cause debate entirely but requires the employee’s genuine consent and administrative approval.

B. Trial-period exit, dismissal for gross misconduct and the agreed termination: three doors founders constantly confuse

Three different exits look similar to a busy founder, but they obey opposite rules. Choosing the wrong door is the most common and most expensive mistake foreign employers make with a first hire.

The first door is the trial period (période d’essai), and it is only open for a short time. A permanent contract may include a trial period whose maximum length is strictly capped: under Article L1221-19 of the Labour Code, “Le contrat de travail à durée indéterminée peut comporter une période d’essai dont la durée maximale est : 1° Pour les ouvriers et les employés, de deux mois ; 2° Pour les agents de maîtrise et les techniciens, de trois mois ; 3° Pour les cadres, de quatre mois.” Renewal is possible only once, only if the contract or applicable collective agreement allows it, and only within these ceilings. During the trial period, either side may end the relationship without stating a cause and without the dismissal procedure, which is why this door is so attractive. But two traps await founders. First, the trial period must be written expressly in the signed contract; an employee who started work without a signed clause has no trial period at all. Second, ending the trial still requires a notice period (délai de prévenance) that grows with time spent: under Article L1221-25 of the Labour Code, “le salarié est prévenu dans un délai qui ne peut être inférieur à : 1° Vingt-quatre heures en deçà de huit jours de présence ; 2° Quarante-huit heures entre huit jours et un mois de présence ; 3° Deux semaines après un mois de présence ; 4° Un mois après trois mois de présence.” Miss that notice and you owe compensation equal to the wages for the missing period. Many foreign founders discover too late that the trial period of their first hire expired weeks ago, because nobody diarised the end date. Audit the contract today: if the trial period is over, this door is closed and you must use one of the other two.

The second door is dismissal for gross misconduct (faute grave): theft, violence, deliberate sabotage, or a refusal that makes any continued presence impossible even during the notice period. Its advantage is financial: the employee loses the statutory severance pay and the notice compensation, since Article L1234-9 of the Labour Code grants severance “sauf en cas de faute grave”, and Article L1234-5 of the Labour Code grants notice compensation “sauf s’il a commis une faute grave”. Its disadvantage is risk: the full dismissal procedure still applies, the two-month clock of Article L1332-4 runs, and if the judge reclassifies the facts as ordinary misconduct, you owe the severance, the notice, and potentially damages for dismissal without real and serious cause. Founders sometimes label ordinary underperformance as gross misconduct to save money; labour courts see through that relabelling and the saving turns into a surcharge. Reserve this door for genuine, documented, recent serious misconduct, with the employee removed from duties immediately and the procedure launched within days.

The third door is the agreed termination (rupture conventionnelle), often the wisest choice for a first hire whose performance disappoints without amounting to misconduct. Here the employer and the employee jointly agree the terms of separation, and no cause has to be proved: under Article L1237-11 of the Labour Code, “L’employeur et le salarié peuvent convenir en commun des conditions de la rupture du contrat de travail qui les lie”, while “La rupture conventionnelle, exclusive du licenciement ou de la démission, ne peut être imposée par l’une ou l’autre des parties.” The price of this flexibility is a negotiated payout at least equal to the statutory severance, since under Article L1237-13 of the Labour Code the agreed payment “ne peut pas être inférieur à celui de l’indemnité prévue à l’article L. 1234-9”, plus a 15-calendar-day cooling-off period for each side after signature and then administrative approval: under Article L1237-14 of the Labour Code, “A l’issue du délai de rétractation, la partie la plus diligente adresse une demande d’homologation à l’autorité administrative”, which “dispose d’un délai d’instruction de quinze jours ouvrables”, and “La validité de la convention est subordonnée à son homologation.” In practice the request goes to the DREETS, the regional authority for the employer’s location, through the official online procedure, and silence for 15 working days counts as approval. Any dispute about the agreement or its approval goes to the labour court within 12 months of approval. For a founder abroad, this route has a decisive advantage: one or two calm meetings, often by video followed by an in-person signing, replace months of conflict, and the approval decision gives the separation a solidity that a dismissal letter never has. Its condition is genuine consent: pressuring the employee to sign, or signing the day after a disciplinary meeting, exposes the agreement to annulment.

II. How to run a dismissal from abroad without handing the employee victory: procedure, cost and disputes

A. The mandatory steps you must complete remotely: invitation, meeting, notification letter and notice period

Once the trial period is over and the agreed termination is not an option, dismissal follows a mandatory sequence. Skip or mistime one step and the dismissal becomes procedurally flawed, which costs money even when the cause was genuine: as Article L1235-2 of the Labour Code provides for a well-founded dismissal tainted by a procedural irregularity, “le juge accorde au salarié, à la charge de l’employeur, une indemnité qui ne peut être supérieure à un mois de salaire.” Every step can be managed from abroad if you organise it through a local point of contact, typically a payroll provider, an accountant, or counsel in France who holds a written delegation.

Step one is the invitation to a preliminary meeting (convocation à un entretien préalable). The rule is strict: under Article L1232-2 of the Labour Code, “L’employeur qui envisage de licencier un salarié le convoque, avant toute décision, à un entretien préalable”, and “La convocation est effectuée par lettre recommandée ou par lettre remise en main propre contre décharge.” The letter must state its purpose, and “L’entretien préalable ne peut avoir lieu moins de cinq jours ouvrables après la présentation de la lettre recommandée ou la remise en main propre de la lettre de convocation.” From abroad, send the registered letter with acknowledgment of receipt (lettre recommandée avec accusé de réception) in good time, keep the tracking proof, and count five full working days. Hand delivery against receipt is faster but requires someone on site. Never state the dismissal decision in the invitation: at this stage you only “envisage” dismissal, and any letter reading as a decided dismissal voids the procedure.

Step two is the meeting itself. Its purpose is to let the employee explain, and you must listen even when your decision feels made. The employee may come accompanied: under Article L1232-4 of the Labour Code, “Lors de son audition, le salarié peut se faire assister par une personne de son choix appartenant au personnel de l’entreprise”, and where the company has no staff representatives, which is always the case for a first hire, “le salarié peut se faire assister soit par une personne de son choix appartenant au personnel de l’entreprise, soit par un conseiller du salarié choisi sur une liste dressée par l’autorité administrative.” Your invitation letter must therefore mention this right and give the address where the adviser list is available. On your side, you do not have to attend in person: a duly authorised representative, such as your accountant or counsel with a written power, can conduct the meeting, take notes, and report back. Hold the meeting in French, keep it factual, and write a short minute the same day.

Step three is the notification letter (lettre de licenciement), the single most important document of the whole process. Under Article L1232-6 of the Labour Code, “Lorsque l’employeur décide de licencier un salarié, il lui notifie sa décision par lettre recommandée avec avis de réception”, and “Cette lettre comporte l’énoncé du ou des motifs invoqués par l’employeur.” It “ne peut être expédiée moins de deux jours ouvrables après la date prévue de l’entretien préalable”. Draft the letter in precise French: dated facts, figures, prior warnings with dates, and the exact reason each fact makes continued employment impossible. Use the official model forms published by the labour ministry as a skeleton, then add your facts. Remember that this letter sets the boundaries of any later dispute, with only the narrow clarification mechanism of Article L1235-2 available afterwards. Have the draft reviewed by someone who reads dismissal letters regularly before it leaves your outbox, because a reviewed letter costs little and an unreviewed one can cost a year of salary.

Step four is the notice period (préavis) and the departure paperwork. Except in cases of gross misconduct, the employee either works the notice or receives compensation in lieu: Article L1234-5 of the Labour Code states that “Lorsque le salarié n’exécute pas le préavis, il a droit, sauf s’il a commis une faute grave, à une indemnité compensatrice”, and that this compensation stacks with the statutory severance pay. The notice length comes from the contract or the applicable collective agreement, so check which agreement covers your company before announcing anything. On the last day, hand over three documents: the work certificate, the final pay statement (solde de tout compte), and the employment attestation for the unemployment insurance body, and file the departure in the monthly payroll return (DSN) so that social contributions stop cleanly. Founders who forget the departure formalities keep paying contributions for a ghost employee and discover the overpayment months later during a payroll audit.

B. What the separation costs and how the employee challenges it: severance pay, the Macron scale and the Paris labour court

Budget the separation before you start, because the total decides whether dismissal, agreed termination, or one more supervised chance is the rational choice. Three amounts stack up: the statutory severance, the notice compensation, and the litigation risk priced by the Macron scale.

The statutory severance (indemnité légale de licenciement) is owed to any employee on a permanent contract dismissed with at least 8 months of continuous service, except for gross misconduct: Article L1234-9 of the Labour Code provides that “Le salarié titulaire d’un contrat de travail à durée indéterminée, licencié alors qu’il compte 8 mois d’ancienneté ininterrompus au service du même employeur, a droit, sauf en cas de faute grave, à une indemnité de licenciement.” The minimum rate is set by regulation: under Article R1234-2 of the Labour Code, “L’indemnité de licenciement ne peut être inférieure aux montants suivants : 1° Un quart de mois de salaire par année d’ancienneté pour les années jusqu’à dix ans ; 2° Un tiers de mois de salaire par année d’ancienneté pour les années à partir de dix ans.” Take a concrete first-hire example: a gross monthly salary of 3,500 euros and two years of service gives a minimum severance of two times one quarter of 3,500, which is 1,750 euros, calculated on the reference salary including bonuses prorated over the year. The contract or collective agreement often grants more, so read it before promising any figure. Add the notice compensation for the months not worked, any accrued paid leave, and, for an agreed termination, the negotiated premium above the minimum.

The litigation risk is priced by the Macron scale (barème Macron), the table that caps damages for dismissal without real and serious cause. Under Article L1235-3 of the Labour Code, “Si le licenciement d’un salarié survient pour une cause qui n’est pas réelle et sérieuse, le juge peut proposer la réintégration du salarié dans l’entreprise, avec maintien de ses avantages acquis”, and if either side refuses reinstatement, “le juge octroie au salarié une indemnité à la charge de l’employeur, dont le montant est compris entre les montants minimaux et maximaux fixés dans le tableau”. For our example employee with two years of service, the table gives a minimum of 3 months and a maximum of 3.5 months of gross salary, meaning 10,500 to 12,250 euros on a 3,500-euro salary, on top of the severance and notice already owed. With less than one year of service the minimum is lower, but the procedural indemnity of up to one month for flawed procedure can apply on top. This arithmetic explains why a clean agreed termination with a premium of two or three months often costs less than a dismissal that fails: compare the certain premium against the stacked total of severance, notice and scale damages, plus counsel fees on both sides.

If the employee challenges the dismissal, the case goes to the conseil de prud’hommes, the labour court for the place of work, so for a Paris-based first hire that is the Paris labour court, with a mandatory conciliation hearing first and a judgment phase if conciliation fails. Time works in your favour once the procedure was clean, because challenges expire fast: under Article L1471-1 of the Labour Code, “Toute action portant sur la rupture du contrat de travail se prescrit par douze mois à compter de la notification de la rupture.” Keep the complete file, the signed powers of your representative, the postal proofs and the payroll records for well beyond those twelve months, because a claim filed on the last day is still a claim. If you chose the agreed termination, the approval request goes to the DREETS of Île-de-France for a Paris company through the official online filing, and the same twelve-month clock runs from approval for disputes about the agreement. Readers setting up their structure will find the earlier steps, from the bank account and the Kbis to VAT and the first hire itself, in our guide to setting up a company in France as a foreign founder, which this article completes on the employment side.

Conclusion

Dismissing your first French employee from abroad is manageable, but only in the right order: first check whether the trial period is still open, then assess honestly whether your file proves a real and serious cause, then choose between dismissal for cause and an agreed termination with full knowledge of the price of each, and only then run the procedure step by step without skipping the five-day wait, the meeting, or the two-day wait before the letter. Draft the notification letter as if the judge will read it, because one day a judge may read it, and keep every proof for at least twelve months after the separation. A dismissal launched on a solid file and a clean procedure rarely returns to haunt a young company; a dismissal launched by email from abroad almost always does, with interest calculated on the Macron scale.