End of fixed-term contracts and other specific contracts
Certain employment contracts are intended to end on a specific date or according to particular rules, such as the fixed-term contract (CDD). Their termination is strictly regulated, particularly in cases of early termination.
In a nutshell
- A fixed-term contract (CDD) generally ends automatically on the scheduled date.
- Early termination is only possible in limited cases established by law.
- Unlawful termination may result in the payment of damages.
- The end of the contract generally entitles the employee to an indemnity and unemployment benefits.
In what cases can a fixed-term contract end before its term?
A fixed-term contract (CDD) ends automatically on the scheduled date or upon the completion of the purpose for which it was concluded. In principle, the suspension of the contract (sickness, maternity) does not postpone this deadline.
For the employer, the key is to clearly distinguish between the normal end of a contract and an early termination, which is subject to strict rules.
Early termination of a fixed-term contract is only possible in cases exhaustively provided for by law.
- Termination during the probationary period: During the probationary period, either party may terminate the contract freely, provided they observe a notice period.
- Termination by mutual agreement: The employer and the employee may decide together to end the contract. This agreement must be formalized in writing.
- Resignation of the employee for a permanent contract: An employee may terminate their fixed-term contract (CDD) if they can provide proof of being hired under a permanent contract (CDI). They must then observe a notice period, unless an exemption is granted.
- Other authorized cases: A fixed-term contract can also be terminated before its term in the following situations: serious misconduct, force majeure or incapacity as established by the occupational physician. Outside of these cases, the termination is unlawful and may lead to compensation.
What indemnities are due at the end of a fixed-term contract?
At the end of the contract, the employee generally receives two types of compensation:
- End-of-contract allowance.
- Compensatory paid leave.
The end-of-contract allowance (prime de précarité) compensates for the temporary nature of the contract. In principle, it is equal to 10% of the total gross remuneration, unless exceptions are provided for by law or a collective agreement.
It is specifically not due in the event of:
- Serious misconduct.
- Early termination at the employee’s initiative outside of authorized cases.
- Refusal of a permanent contract for a similar position.
- For certain specific contracts (customary fixed-term contracts, seasonal contracts, etc.).
When accrued leave has not been taken, a compensatory allowance is paid according to the standard rules.
What is the impact on unemployment benefits?
The end of a fixed-term contract (CDD) generally entitles the employee to the return-to-work allowance (ARE), provided they meet the required conditions.
However, an improper early termination may jeopardize this right.
For the employer, correctly providing the France Travail certificate is essential.
What are the conditions for other types of contracts?
Certain contracts require particular vigilance.
Professionalization contracts can be concluded as a fixed-term or permanent contract. When it is a fixed-term contract, it follows the standard CDD rules but without the end-of-contract allowance. In the case of a permanent contract, standard termination rules apply.
Apprenticeship contracts are subject to their own specific rules, particularly regarding the timing of the termination within the contract. A prior analysis is recommended.