Selecting a language will automatically trigger the translation of the page content.

Labour Loan Between Companies

Verified 12 February 2021 - Legal and Administrative Information Directorate (Prime Minister)

Measures to simplify labour lending

Until 30 June 2021, certain exceptional measures are extended:

  • The lending undertaking, using the partial activity, shall be allowed to charge the user undertaking less than the total cost of the loan
  • Possibility to conclude a single agreement of availability in case of loan of several employees
  • Possibility not to specify the working hours in the addendum to the loaned employee's employment contract

That's what it says Order No. 2020-1597 of 16 December 2020 and Article 52 of Act No. 2020-734 of 17 June 2020 .

To overcome recruitment difficulties in certain sectors under stress or to avoid partial unemployment in the event of a drop in activity, a company may use the labour loan. The employer then makes employees available to another user undertaking for a specified period of time.

General case

The labour loan must be non-profit for the lending business.

The lending company must only charge the user company for the wages paid to the employees, the associated social security contributions and the professional expenses reimbursed to the employee.

But if a for-profit transaction that has the exclusive purpose of lending labour is prohibited, there are several exceptions:

  • Temporary work acting agencies 
  • Timeshare 
  • Model Agency by the holder of the Model Agency Licence
  • Loan of sportsmen made available to the delegation sports federation as a member of a French team
  • Provision of employees to a trade union
Employee Agreement

The loan of labour requires the explicit agreement of the employee concerned. This agreement is written in attractive the employment contract. If he refuses, the employee cannot be punished, dismissed or discriminated against.

The amendment to the employment contract must include the following:

  • Tasks assigned to the user company 
  • Hours and place of work 
  • Specific features of the workstation
  • Possibility of planning probationary period by agreement between the lending company and the employee

The termination of the probationary period by one of the parties before its end does not constitute grounds for punishment or dismissal.

Please note

the probationary period becomes mandatory if the labour loan involves a change in an essential element of the employment contract, such as pay or hours of work. Each party may terminate the probationary period.

Release Convention

The lender and the user undertaking must sign an agreement designating a single employee. The Convention mentions the following:

  • Duration of provision 
  • Employee Identity and Qualification 
  • Method of determining the wages, social security and professional fees charged to the user undertaking by the lending undertaking 
Information and consultation of the Social and Economic Committee (ESC)

In the lending business, the employer must consult the CSE: titleContent prior to the implementation of a labour loan and inform it of the various agreements signed. The ESC should also be informed if the position in the user undertaking presents particular health or safety risks.

In the user undertaking, the ETUC must be informed and consulted prior to the reception of employees made available in this context.

Lending a large company to a young company or SME

A large company can make its employees available to a young or small company to improve the skills of its workforce, for example.

The labour loan transaction may be "sub-invoiced" by the lending company and be considered non-profit on the following cumulative terms:

  • The lending company has at least 5000 employees or belongs to a group of at least 5000 employees,
  • The user company has less than 8 years of existence, is SME: titleContent less than 250 employees or a structure of general interest or public utility,
  • The maximum loan term is 2 years

Please note

this type of provision cannot be made within the same group.

Employee Agreement

The loan of labour requires the explicit agreement of the employee concerned. This agreement is written in attractive the employment contract. If he refuses, the employee cannot be punished, dismissed or discriminated against.

The amendment to the employment contract must include the following:

  • Tasks assigned to the user company 
  • Hours and place of work 
  • Specific features of the workstation
  • Possibility of planning probationary period by agreement between the lending company and the employee

The termination of the probationary period by one of the parties before its end does not constitute grounds for punishment or dismissal.

Please note

the probationary period becomes mandatory if the labour loan involves a change in an essential element of the employment contract, such as pay or hours of work. Each party may terminate the probationary period.

Release Convention

The lender and the user undertaking must sign an agreement designating a single employee. The Convention mentions the following:

  • Duration of provision 
  • Employee Identity and Qualification 
  • Method of determining the wages, social security and professional fees charged to the user undertaking by the lending undertaking 
Information and consultation of the Social and Economic Committee (ESC)

In the lending business, the employer must consult the CSE: titleContent prior to the implementation of a labour loan and inform it of the various agreements signed. The ESC should also be informed if the position in the user undertaking presents particular health or safety risks.

In the user undertaking, the ETUC must be informed and consulted prior to the reception of employees made available in this context.

The user undertaking shall be responsible for the conditions of performance of the work during the making available. The employee made available shall have access to the facilities and means of public transport enjoyed by the employees of the user undertaking.

During the loan period, the employment contract between the employee and the lending company is neither broken nor suspended.

The employee continues to belong to the staff of the lending company and to benefit from treaty provisions, as if he were carrying out his work in his home company.

The provision shall not affect the protection of protected employee (example: a member of CSE: titleContent).

At the end of the loan period, the employee returns to his or her original job or equivalent position, without affecting his or her career or earnings.

The Labour Loan illegal is punishable by up to 2 years imprisonment and €30,000 (amount increased to €150 000 for legal person).

Additional penalties may also be imposed (prohibition of certain professional activities, exclusion from public contracts, publication of the judgement in newspapers, for example).

Administrative sanctions may also be applied (e.g. the abolition of State aid, repayment of public aid already received, temporary closure of the company).

To small and medium-sized and micro-entreprises, do you have a business project, a difficulty or a question ?

Quick and simple public service: you will be contacted over the phone by one of our experts.

Speak with an advisor on Place des Entreprises