You formed a French company from abroad, obtained the Kbis — the official registration certificate issued by the greffe, the clerk of the commercial court — opened a bank account, and hired your first employee in France on a CDI, the contrat à durée indéterminée or permanent contract. A few months later, the disappointment is clear: missed targets, complaints from clients, or simply a profile that does not fit the role. In many countries, the answer would be a short notice period and a goodbye. In France, the answer depends entirely on timing and paperwork. End the relationship during a valid probation period and the exit is quick and cheap. End it one week too late, with the wrong letter, and the same exit becomes a dismissal without real and serious cause, with severance, damages under a statutory scale, and a labour court case managed from another continent. This article maps both exits for a foreign founder who runs the company from abroad: how long you can test a new hire, how to end probation without creating a dismissal, the three mandatory steps of a personal dismissal, what each step costs, and what proof the judges expect. It follows the same practical path as our guide to setting up a company in France as a foreign founder, from bank account and Kbis to VAT and first hire, and goes one step further into the moment every founder dreads: the first hire is not working out.
I. Ending the contract during the probation period: the cheapest exit, but only with flawless paperwork
A. How long you can test a new hire, and why the written clause decides everything
French law gives probation a single purpose. Article L. 1221-20 of the Labour Code states that “La période d’essai permet à l’employeur d’évaluer les compétences du salarié dans son travail, notamment au regard de son expérience, et au salarié d’apprécier si les fonctions occupées lui conviennent.” Everything about probation flows from this sentence: the employer tests skills, the employee tests the job, and either side can walk away quickly while the test is running. But a termination driven by something else — the employee’s state of health, a discriminatory motive, an economic reason that has nothing to do with skills — falls outside that purpose, and the labour courts sanction it as an abuse of the probation mechanism. From day one, assess the work, write down the assessment, and keep the exit connected to the assessment.
The maximum durations are fixed by statute according to the employee’s category. Article L. 1221-19 of the Labour Code provides that “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.” These are ceilings, not defaults. The applicable convention collective — the branch-level collective bargaining agreement that covers your sector — often sets shorter periods, and the contract can always provide less than the ceiling. Check the branch agreement before you sign: in retail, hotels, construction or business services, the probation grid is frequently shorter than the statutory maximum, and the shorter text wins.
The decisive rule for a foreign founder is that probation is never implied. Article L. 1221-23 of the Labour Code states that “La période d’essai et la possibilité de la renouveler ne se présument pas. Elles sont expressément stipulées dans la lettre d’engagement ou le contrat de travail.” If the signed contract contains no probation clause, there is no probation, however standard it may feel in your home country. The employee is then a confirmed CDI holder from the first day, and the only way out is a dismissal with its full procedure. Every employment contract signed for your French company must therefore contain an express probation clause stating its duration, and, where you want the option, an express renewal clause.
Renewal is where foreign employers most often lose. Article L. 1221-21 of the Labour Code allows renewal only once, only where an extended branch agreement permits it, with that agreement fixing the conditions and durations, and caps the total including renewal at four months for manual and clerical staff, six months for supervisors and technicians, and eight months for executives. Two cumulative conditions follow: the branch agreement must authorise renewal, and the employee must agree to it in writing, unequivocally, before the initial period expires. A signature that merely acknowledges receipt of the renewal letter is not an agreement.
The Cour de cassation, the French supreme court for civil and labour matters, enforced this strictly in a recent ruling. On 11 June 2025, its Social Chamber quashed an appeal decision that had accepted a renewal from an email exchange in which the employee had returned a signed letter writing “voici la lettre de renouvellement signée ce jour” — here is the renewal letter signed today — followed by his signature. The Court held that “En se déterminant ainsi, par des motifs qui ne suffisent pas à caractériser l’accord écrit non équivoque du salarié au renouvellement de la période d’essai, la cour d’appel a privé sa décision de base légale” (Cass. soc., 11 June 2025, appeal no. 23-21.128). Because the renewal was invalid, the termination at the end of the supposed renewed period was not a probation exit at all but a dismissal, with notice compensation and damages. The lesson for a founder managing from abroad is blunt: send a clear written renewal proposal before the initial period ends, obtain a reply that expressly accepts the renewal — not a mere acknowledgment of receipt — and diary the expiry date of the initial period from the day the contract is signed. If the renewal is doubtful, terminate within the initial period instead.
B. How to end probation from abroad without turning the exit into a dismissal
Ending probation requires no statement of reasons and no preliminary meeting, which is exactly why it is the cheapest exit. But “no reasons required” does not mean “no formalities”. The employer must observe a notice period that grows with the employee’s length of service. Article L. 1221-25 of the Labour Code requires the employee to be warned within a period of at least twenty-four hours for less than eight days of presence, forty-eight hours between eight days and one month of presence, two weeks after one month of presence, and one month after three months of presence, and adds that “La période d’essai, renouvellement inclus, ne peut être prolongée du fait de la durée du délai de prévenance.” The notice cannot stretch probation beyond its end date: if the notice period runs past the final day, the contract continues as a confirmed CDI and the exit must follow dismissal rules. Where the notice is not observed, the employee is owed compensation equal to the wages and benefits he or she would have received through the notice, including paid-leave compensation, unless guilty of serious misconduct. Symmetrically, Article L. 1221-26 gives an employee who leaves during probation a forty-eight-hour notice, reduced to twenty-four hours for less than eight days of presence.
In practice, a founder abroad should run the exit like a small conveyancing file. First, count backwards from the last day of probation and add the applicable notice: with four months of presence, a one-month notice means the decision must be notified at the end of the third month. Second, notify in writing by lettre recommandée avec avis de réception — registered letter with acknowledgment of receipt — or by hand delivery against a signed receipt where a local manager can do it, and keep the proof of the sending date, because the date of notification starts the notice. State clearly that the probation period is being ended; do not dress the letter as a dismissal and do not list misconduct charges, since disciplinary matters follow a different procedure. Third, run payroll through the end of the notice or pay the compensatory amount, and issue the three end-of-contract documents every departing employee must receive: the certificat de travail (employment certificate), the attestation France Travail (the certificate for unemployment benefits), and the reçu pour solde de tout compte (the final settlement receipt). Your French payroll provider or expert-comptable — the chartered accountant — prepares these routinely, and the monthly DSN, the déclaration sociale nominative that reports payroll data to the social bodies, must reflect the exit. Fourth, diary everything in the shared company calendar with alerts at thirty, fifteen and seven days before expiry: most missed probations are missed because nobody watched the date from another time zone.
Two traps deserve special attention. Ending probation for a reason unrelated to the assessment of the work — for example because orders dropped, or just after the employee announced a pregnancy or requested leave — exposes the company to a claim that the termination was abusive or discriminatory, and discrimination claims carry no length-of-service condition and heavy damages. And a probation clause copied from a foreign template that exceeds the French ceiling, or a renewal without branch authorisation, is simply unenforceable: the exit collapses into a dismissal without cause. When in doubt about the clause, assume there is no valid probation and follow the dismissal procedure described below. A careful week of procedure costs far less than a labour court judgment.
II. Dismissing after probation: the procedure you must follow to the letter
A. The three mandatory steps, their deadlines, and the letter that frames the whole dispute
Once probation has ended, a permanent contract can be terminated by the employer only through a licenciement, a dismissal, and only for a cause that is real and serious. Article L. 1232-1 of the Labour Code states that “Tout licenciement pour motif personnel est motivé dans les conditions définies par le présent chapitre. Il est justifié par une cause réelle et sérieuse.” For a first hire who disappoints, the relevant ground is usually professional insufficiency — insuffisance professionnelle — meaning objectively inadequate results or methods, as opposed to misconduct, which is a wilful breach of obligations and follows disciplinary time limits. Insufficiency must be demonstrated with facts: set written objectives on hiring, hold documented appraisals, send written warnings pointing to specific shortcomings, offer training or support, and allow time to improve. A dismissal letter that asserts poor performance for the first time, with no prior written trace, rarely survives before the judges. Build the file during employment, not after the decision to dismiss is taken.
The procedure itself has three steps, and each step has a clock. Step one is the invitation to a preliminary meeting. Article L. 1232-2 of the Labour Code requires the employer, before any decision, to summon the employee to a preliminary interview by registered letter or hand-delivered letter against receipt, stating the purpose of the meeting, and provides that the meeting cannot take place less than five working days after presentation of the registered letter or hand delivery. Step two is the meeting itself. Article L. 1232-4 allows the employee to be assisted by a person of his or her choice from the company’s staff or, where the company has no staff representative institutions — the normal situation for a first hire — by an outside employee adviser, the conseiller du salarié, chosen from an official list, with the invitation letter mentioning this right and the offices where the list is available. For a founder abroad, the practical setup is to mandate in writing a person in France — a local manager, the payroll provider’s social-law contact, or the company’s French lawyer — to conduct the meeting, listen to the employee’s explanations, and write a dated account the same day. Skipping the meeting or holding it too early is a procedural irregularity that generates damages even where the grounds are solid.
Step three is the notification. Article L. 1232-6 of the Labour Code provides that “Lorsque l’employeur décide de licencier un salarié, il lui notifie sa décision par lettre recommandée avec avis de réception. Cette lettre comporte l’énoncé du ou des motifs invoqués par l’employeur. Elle ne peut être expédiée moins de deux jours ouvrables après la date prévue de l’entretien préalable au licenciement auquel le salarié a été convoqué.” The letter must state the reasons, and the Ministry of Labour publishes model letters the employer may use. From abroad, send the registered letter with acknowledgment of receipt through your French relay and archive the tracking receipts: the posting date proves the two-working-day gap, and the acknowledgment proves notification, which starts the twelve-month period for the employee to challenge the dismissal.
The dismissal letter deserves obsessive care because it frames the entire future dispute. The Social Chamber recalled in a published ruling that “la lettre de licenciement fixe les limites du litige en ce qui concerne les griefs articulés à l’encontre du salarié et que le juge a l’obligation d’examiner l’ensemble des griefs invoqués dans la lettre de licenciement” (Cass. soc., 23 October 2024, appeal no. 22-22.206, published in the Bulletin). Every grievance must appear in the letter, stated precisely with dates and facts, because the employer cannot add new grounds afterwards, and the judge must examine all of them. A short vague letter — “does not meet expectations” — gives the judge nothing to verify and invites a finding of no real and serious cause. A long letter mixing unproven accusations invites the same result on the unproven parts. State each fact, attach each prior warning to the file, and have the draft reviewed in France before posting. Never mention the employee’s health, family status, union activity or any protected characteristic: one such sentence can requalify the dismissal as discriminatory and void.
B. What the exit costs, what the judge checks, and how to keep proof from abroad
Budget the exit before launching it. The statutory severance — indemnité de licenciement — is owed to a permanent-contract employee dismissed with at least eight months of uninterrupted service, except for serious misconduct. Article L. 1234-9 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.” Article R. 1234-2 sets the minimum at one quarter of a month’s salary per year of service up to ten years, plus one third of a month per year beyond ten years. For a first hire with two full years of service on a gross monthly salary of 3,500 euros, the legal minimum is therefore 2 × 875 = 1,750 euros, calculated pro rata for incomplete years on the average of the best-earning months. Always compare with the branch collective agreement, which frequently grants more — many agreements add seniority bonuses or higher fractions — and pay the higher of the two. On top of severance, the employee who does not work the notice period is owed compensation in lieu: Article L. 1234-5 provides that “Lorsque le salarié n’exécute pas le préavis, il a droit, sauf s’il a commis une faute grave, à une indemnité compensatrice”, with no reduction of the wages and benefits the employee would have received, including paid-leave compensation, and cumulation with severance. The notice length itself comes from the collective agreement, the contract or local custom — commonly one to three months for a first hire — so read the branch text before announcing anything. Add the paid-leave balance, any pro rata bonus, and the employer’s share of the transaction: a dismissal launched cleanly typically costs one to four months of salary all-in for a short-serving first hire, before any dispute.
If the employee challenges the dismissal before the conseil de prud’hommes — the French labour court — the financial exposure follows a statutory scale. Article L. 1235-3 of the Labour Code provides that a dismissal without real and serious cause gives rise to damages between a floor and a ceiling expressed in months of gross salary: for less than one full year of service the ceiling is one month with no floor, for one year of service the range is one to two months, and for two years it is three to three and a half months, rising progressively with seniority. Procedural irregularities add a separate capped indemnity, and discriminatory or void dismissals escape the scale with a six-month floor. Before the judges, the doubt benefits the employee: Article L. 1235-1 directs the judge to assess the procedure and the reasons on the evidence supplied by both sides, and provides that “Si un doute subsiste, il profite au salarié.” The same article allows the parties, at the conciliation stage, to end the dispute by agreement with a lump-sum payment set by decree scale — often the sensible outcome for a small company that wants certainty. Note the clock on the employee’s side as well: Article L. 1471-1 provides that “Toute action portant sur la rupture du contrat de travail se prescrit par douze mois à compter de la notification de la rupture.” Twelve months after notification, an unchallenged dismissal is definitively closed.
Running all of this from abroad is a matter of organisation, not presence. Keep every employment document in French, the working language of the file: objectives, appraisals, warnings, meeting invitation, dismissal letter. Send formal letters by registered mail with acknowledgment of receipt and store the slips with the payroll file. Centralise payslips, the DSN returns, time records and the DPAE — the pre-hiring declaration filed with URSSAF, the social-contributions collector — with your payroll provider, because URSSAF audits of young companies routinely start with undeclared-work checks, and a fully declared first hire is the simplest file to defend. For founders based in Paris and the Île-de-France region, where most foreign companies place their first hire, disputes go before the local labour court, conciliation first, and a French lawyer can conduct the whole case — filings, conciliation, pleadings — while the founder follows from abroad and appears only if the court requires it. Practical tip from Paris files: allow six to eighteen months for a contested case, and weigh that calendar against a negotiated mutual separation, the rupture conventionnelle with its administrative approval, or a conciliation settlement. A short, well-documented procedure started early beats a long, poorly documented one every time — and it starts with the probation clause you sign on day one.
Conclusion
A first hire that does not work out is a management problem with a legal timetable. During probation, the exit is quick and inexpensive: verify the written clause, respect the maximum durations and the renewal conditions, count the notice backwards from the last day, and notify in writing with proof. After probation, the exit is a dismissal for real and serious cause: invite to a preliminary meeting with five working days’ notice, hear the employee with his or her chosen assistant, notify by registered letter at least two working days later with every grievance precisely stated, and budget severance, notice compensation and the end-of-contract documents. At each stage, the written record decides the outcome — objectives and warnings before the decision, model-compliant letters during the procedure, archived receipts after notification — and the twelve-month challenge period closes files that were handled properly. Run from abroad, this discipline is entirely achievable through a French payroll relay and a local correspondent, provided the calendar is watched from the day the contract is signed.