The ‘Wisdom Dividend’: France’s new law on experienced employees

The aim of the new law is to facilitate the recruitment of experienced job seekers and support their continued employment. As we discussed in our article from February, it is now well known that the global workforce is getting older and employers are realising the need, and the benefits, of embracing their more experienced employees. Interestingly, the terminology of ‘experienced employees’ is used rather than ‘older employees’ in the new French legislation (and in the underlying agreements), to highlight the potential of these employees; what we have coined the ‘Wisdom Dividend’.

So, what does the new legislation actually mean for employers with operations in France? In this article, we run through each of the key changes that have been introduced.

A new periodic obligation to negotiate with trade unions has been introduced. This obligation concerns the employment and improvement of working conditions for experienced employees in view of their age. The negotiations must take place at least every four years in companies and groups of companies with at least 300 employees.

The law modifies the system of ‘career meetings’, designed to strengthen the employability of employees. The new framework is therefore relevant not just to experienced employees, but also other employees.

These meetings must take place during the first year following recruitment and then every four years. They must cover the following elements:

• The employee’s skills and qualifications used in their current job, but also, from now on, their potential development in light of changes within the company.

• The employee’s situation and career path, in light of changes in the profession and employment prospects within the company.

• The employee’s training needs, which is a new addition. These may relate to their current professional activity, their job in light of changes within the company, or a personal project.

• The employee’s career development aspirations. The meeting can now pave the way for internal or external retraining, a career transition project, a skills assessment or the validation of prior learning.

• The employee’s activation of their personal training account, payments made into this account by the employer, and career development advice.

A summary review of the employee’s career path must take place every eight years (instead of every six years, as was the position previously).

A career meeting is systematically offered to employees who return to work after certain types of leave, such as maternity leave or long-term sick leave, if the employee has not had a career path meeting in the 12 months prior to their return to work.

Furthermore, a career meeting must be organised within two months of the mid-career medical examination (which takes place in the calendar year of the employee’s 45^th birthday). This meeting covers the adaptation or adjustment of tasks and the workstation, burnout prevention, training needs and any wishes the employee may have for mobility or professional retraining.

Finally, at the end of the employee’s career (i.e. when they are between the ages of 58 and 60), the following topics must now be addressed: conditions for continuing in employment and possibilities for end-of-career adjustments (in particular, the possibility of switching to part-time work or gradual retirement).

The law establishes an ‘experience enhancement contract’ on an experimental basis for the next five years. This is a permanent contract concluded with a person (the following conditions are cumulative) who:

• is at least 60 years of age (or at least 57 if provided for in an extended industry-wide agreement);

• is unemployed;

• is not eligible for a full base retirement pension (with some exceptions);

• has not been employed by the prospective company or, where applicable, by a company belonging to the same group, during the previous six months.

When signing the contract, the employee must provide the employer with a document issued by the pension insurance fund stating the expected date on which they will be entitled to a full pension. If the date of entitlement to a full pension is subsequently revised, the employee must inform their employer and provide them with the updated document.

The employer may, subject to a notice period and in return for compensation at least equal to the redundancy payment, retire the employee when they reach the legal age (between 62 and 64 depending on their generation) or the age at which they become eligible for a full pension (67).

In return, the employer is exempt from the specific employer’s contribution of 30% on the amount of the retirement allowance paid to the employee. This applies to allowances paid from the day following the promulgation of the law until the end of the third year after that date.

Employers who refuse to allow employees to take progressive retirement must now provide a more detailed and substantiated justification for their refusal.

In addition to the incompatibility between the working hours requested by the employee and the economic activity of the company, this refusal must also be justified by:

• the consequences of the requested reduction in working hours on the continuity of the company’s (or department’s) activity;

• the difficulties encountered in recruiting for the position concerned (if the consequences involve recruitment).

In order to encourage the hiring of senior employees on permanent contracts, compulsory retirement is now possible for employees hired after they have already reached the age required to automatically qualify for a full pension.

France’s new law signals a stronger focus on supporting experienced employees throughout their careers. Employers must prepare for periodic negotiations with trade unions on employment and working conditions, and ensure career development meetings cover skills, training needs and end-of-career planning. These obligations apply particularly to larger employers and will likely require updates to HR processes.

The legislation also introduces practical measures such as the experimental ‘experience enhancement contract’ for hiring senior jobseekers, stricter rules on progressive retirement refusals, and extended retirement conditions. Employers should review policies, train managers on new requirements, and consider leveraging the new contract.