Company closure for annual leave: is the employee compensated?
Verified 21 January 2025 - Directorate for Legal and Administrative Information (Prime Minister)
If the employer decides to close the company for a period (for example in August), the employee can be compensated during this period of inactivity, subject to conditions. This depends on the number of paid holidays acquired by the employee before the company closes. We present you with the information you need to know.
The employer may decide to temporarily close the company (for example, in the summer).
Before closing, the Social and Economic Committee (ESC), if one exists in the company, shall be consulted for an opinion.
In the absence of an ESC, a collective company agreement must lay down the rules applicable and the formalities to be observed in connection with the closure of the company.
In the absence of a collective agreement, the employer alone may decide to shut down the company. The employer is not obliged to obtain the agreement of the employees.
However, when deciding to close the company in the summer, the employer must warn employees at least 1 month before the closing date by any means (display in the company, mail, mail).
If the employer closes the company without notifying employees within this period, the closure of the company is not considered as a period of paid leave and the employer must compensate the employees for the lost wages.
Warning
The company's annual closure cannot exceed 24 days working days.
The compensation of the employee varies according to whether or not he has acquired sufficient days off during the company's closing period.
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The employee has earned enough days off before the close
If the employer decides to close the company for a period (for example in August), the employee is compensated according to the number of days he paid leave acquired.
The employee then receives the paid leave allowance under the usual conditions, paid by the company, throughout the period of closure of the company and cessation of its activity.
Please note
When the company is shut down for a number of days beyond the statutory holiday (30 days working days), the employer pays the employee a daily allowance for each working day of closure beyond the legal period.
This specific allowance may not be less than the daily allowance for paid leave. She's submissive to income tax.
The employee did not earn enough days off before closing
If the employee has not earned enough paid leave to collect the paid leave allowance France Travail (formerly Pôle emploi) may pay financial aid to the company for the duration of its entire closure.
This aid shall be paid under conditions, depending on whether or not the employee has received Return to Employment Assistance (RWA) or the specific solidarity allowance (SSA) before he was hired.
Employees who have temporarily ceased to be employed should inquire with France Travail whether, depending on their personal situation, they can receive the AER or SSA.
Receipt of the AER or SSA prior to recruitment
The employee keeps acquired right not taken the ARE or SSA during the company closure period.
In this case, the employee can make a request to the France Travail agency to which he was dependent as a job seeker.
The amount of the aid is then calculated by France Travail, which takes account of the following factors:
- Number of days the company is closed
- And paid leave entitlements acquired during the new employment.
Please note
When the company is shut down for a number of days beyond the statutory holiday (30 days working days), the employer pays the employee a daily allowance for each working day of closure beyond the legal period.
This specific allowance may not be less than the daily allowance for paid leave. She's submissive to income tax.
Non-collection of the ARE or SSA prior to recruitment
The employee may ask his employer to benefit from paid leave in anticipation.
The employer is not obliged to accept advance paid leave.
If the employer refuses the leave in advance, the employee must then take a unpaid leave.
Please note
When the company is shut down for a number of days beyond the statutory holiday (30 days working days), the employer pays the employee a daily allowance for each working day of closure beyond the legal period.
This specific allowance may not be less than the daily allowance for paid leave. She's submissive to income tax.
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Aid for unpaid leave (Article 37 of the annexed General Regulation)