France: The Cross-Generation Contract

10 September 2013

Since legislation enacted on 1st March 2013, all private sector employers and public utility companies are henceforth able to implement a new contractual arrangement: the cross-generation contract [le contrat de génération].

The cross-generation contract is an aid to employment intended to establish junior-senior working partnerships, thus promoting employment of young people, as well as hiring and continued employment  of older employees, whilst also ensuring transmission of knowledge and skills.

If your company employs more than 300 employees, or belongs to a group with at least 300 employees, you are directly concerned by this system, since you are bound to hold negotiations on the cross-generation contract.

Prior to opening negotiations, you are required to evaluate the situation within your company regarding employment of youth and older employees.

The document produced is of particular importance as it forms the basis of the negotiations. It must include, notably, an age pyramid, as well as information regarding forecast retirements, recruitment prospects, changes in the positions of young people and older employees in the company …

Based on this evaluation, the result of negotiations regarding the cross-generation contract must be conclusion of a company or a group agreement. Should negotiations fail, the legislation provides for elaboration of a unilateral action plan by the employer. Collective agreement and action plan must be subject to prior consultation by the company’s worker’s council.

The collective agreement and the action plan must both cover the following points:

-          The age groups of young and older employees concerned by the employer’s undertakings;

-          Training and employment of young people;

-          Employment of older employees;

-          Skills transmission;

-          Professional equality;

-          Equality of access to employment;

-          Access to training.

The collective agreement and the action plan must both also cover:

-         Provisional schedule for implementation of the various undertakings;

-         Arrangements for supervision of implementation of the agreement and the action plan;

-         Assessment of achievement of the objectives and undertakings set out in the agreement;

-         Arrangements for publicising the agreement, in particular amongst the staff;

-         Duration of the agreement (3 years maximum) ;

Should your company be concerned by this requirement to negotiate, you are required to file a collective agreement and action plan relating to the cross-generation contract with DIRECCTE before 30th September next.

Failing this, you risk DIRRECTE serving you with formal notice to regularise the situation, and, failing regularisation of being subject to a financial penalty.

The penalty corresponds to the higher of the following amounts:

- 10 % of the reduction in contributions on low salaries given to the company for the period in which it is not covered by an agreement or an action plan complying with the legal provisions;


-  1 % of payments made to all employees or those considered as such, during the same period.

We are at your disposal to guide you through the process, or to assist you with any further details you require regarding the cross-generation contract.