How to build employee retention in France

Businesses have numerous financial mechanisms at their disposal to foster engagement and retain employees. Share ownership, employee savings and bonuses help enhance employer brand and sustainably attract, motivate and retain talent.

Verified on May 11th 2026

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In a nutshell

Businesses in France have a wide range of tools to build employee loyalty.
Employee savings enable businesses to share performance or profits with employees through discretionary and statutory profit-sharing mechanisms.
Employee share ownership enables staff to hold a stake in the firm’s capital.
Certain mechanisms benefit from an advantageous tax and social security framework.

What solutions can help foster employee engagement?

Fostering engagement and retaining employees in France does not rely solely on a fixed salary. It is possible to structure a retention policy around several complementary tools, depending on the firm’s size, status, development strategy and employee profiles.

The main solutions include:

Employee savings schemes.
Employee share ownership.
Value-sharing mechanisms.

These mechanisms do not all share the same objective. Some aim to involve employees in the business’s performance in the short or medium term, while others seek to strengthen long-term engagement by providing access to capital or collective savings.

What are employee savings?

Employee savings encompass several mechanisms that enable employees to be associated with the business’s results, performance or profits.

For the employer, employee savings can serve several objectives:

Build employee retention.
Share the value created.
Enhance the business’s brand and attractiveness.
Structure a more competitive global remuneration policy.

These savings can be distributed via direct payment or placed into employee savings plans.

Discretionary and statutory profit-sharing

Discretionary profit-sharing

This is an optional employee savings mechanism that allows for the payment of a bonus linked to the firm’s results or performance.
It can be implemented regardless of the firm’s size, through a collective agreement or according to regulatory procedures.
The amount paid to employees varies based on the business’s performance.

Statutory profit-sharing

This mechanism consists of redistributing a portion of the firm’s profits to employees.
It is, in principle, mandatory for businesses employing at least 50 employees per month over the last five years.
The scheme must then be implemented during the first fiscal year begun after this period.
The amount paid to employees varies based on the firm’s profits.
The amount paid to employees varies based on the firm’s profits.

Employee savings plans

Employee savings plans allow businesses to structure employee savings over the long term. For an employer, they also constitute a retention tool, complementing salaries, bonuses and value-sharing mechanisms.

There are two main categories of plans:

Medium-term savings plans, such as the PEE (business savings plan) or PEI (inter-business savings plan).
Retirement savings plans, such as the collective business PER (PERECO, formerly PERCO) or the mandatory business PER (PERO).

Depending on the case, these mechanisms can be set up at the level of the business or shared between several firms.

Release of savings

The release of funds varies depending on the plan:

Sums paid into a PEE or PEI are, in principle, locked for five years. However, cases for early release are provided for, including marriage, birth, disability, death, termination of the employment contract or the purchase of a primary residence.
Sums paid into a business retirement savings plan are, in principle, locked until retirement, with certain early release cases (purchase of a primary residence, death of the holder or spouse, disability, etc.).

In France, employee share ownership enables employers to involve employees in the firm’s capital, strengthening long-term loyalty. It can be implemented in joint-stock companies, whether listed or unlisted.

Depending on the business structure and objectives, employers may utilize:

Capital increases reserved for employees.
Share transfers reserved for employees.
Stock options (options to subscribe to or purchase shares).
Free share attribution (AGA).

This fosters long-term employee engagement and strengthens their alignment with the business’s growth strategy.

Implementing employee share ownership

Employee share ownership can be established through:

Capital increases reserved for employees.
Free share distributions.
Employee savings plans.
Granting shares, free shares or subscription options.

Stock-options

Stock options are either share subscription or share purchase options.

Stock options give employees and executives the right to purchase business shares at a preferential price fixed in advance. They are used to attract key talent, encourage long-term commitment and associate beneficiaries with the firm’s value creation.

Stock options provide:

Potential gains if the firm’s value rises.
Shareholder status under advantageous conditions.
Capital gains upon resale.

The tax and social security regime for stock options depends on the grant date and the exercise date.

Free share attribution (AGA)

Free share attributions allow an employer to grant shares to employees or certain executives for free to strengthen loyalty and involve them permanently in the firm’s development.

They are authorized by the extraordinary general meeting and may be subject to vesting conditions (presence) or performance criteria.

AGAs allow for the granting of shares without financial consideration:

They are authorized by the general meeting.
They may be subject to performance criteria.
They strengthen long-term loyalty.

This mechanism benefits from a specific social security and tax framework.

Find out more on impots.gouv.fr

Founder’s share subscription warrants (BSPCE)

BSPCEs are a share ownership tool specifically for joint-stock companies. They grant employees or executives the right to subscribe to business shares at a future date at a price fixed in advance.

They are a powerful recruitment solution, particularly for startups and high-potential innovative firms.

They allow for share acquisition at a preferential price.
They benefit from an attractive social security and tax regime.
They are reserved for joint-stock companies (such as SA and SAS) under specific conditions.

Eligibility criteria for companies issuing BSPCEs

The business must be less than 15 years old and must not have been created through a merger, restructuring or expansion of existing activities.
It must be subject to corporate tax.
At least 25% of the capital must be held directly and continuously by individuals (or by legal entities themselves 75% owned by individuals).

Find out more on the French tax administration website: Employee share ownership on impots.gouv.fr.

The value-sharing bonus allows for the payment of supplementary remuneration:

It is exempt from social security contributions up to a limit of €3,000 per year per employee.
The exemption can reach €6,000 per year per employee if the employer implements a discretionary or voluntary statutory profit-sharing scheme.

The amount of the value-sharing bonus is generally the same for all employees, but it can be adjusted based on certain criteria (remuneration, classification, years of service, etc.).

This bonus is optional, except for firms that meet the following criteria:

The business has between 11 and 49 employees.

The firm is constituted as a legal entity.
Net taxable profit is at least 1% of revenue for 3 consecutive years.

If the business meets these conditions, payment of the bonus is mandatory for five years.

All or part of this bonus may be allocated to an employee savings plan.

At a glance

This page explains employee retention schemes in France and the tools used to involve employees in the company’s performance. It is based on institutional sources such as the French Labour Code and employee savings schemes. It presents information covering employee share ownership, employee savings and value-sharing mechanisms. It uses the example of a company implementing financial schemes to motivate, attract and retain employees over the long term.