Employment of older workers: the negotiation that 9 out of 10 companies are still unaware of

Since October 26, 2025, companies with 300 or more employees and union representation have been required to negotiate on the employment of older workers. This obligation remains largely unknown—and yet, since the 2026 Social Security Financing Act, it carries a direct penalty on employer pension contributions for non-compliance. Here's what you need to know to avoid any surprises.

An obligation to negotiate that went unnoticed

The law on social dialogue and the employment of older workers has created a new topic for mandatory collective bargaining. This applies to companies with at least 300 employees in which one or more trade union sections of representative organizations are established.

This negotiation must take place:

• every 3 years, unless a method agreement is reached;
• Every 4 years at most, if a methodological agreement sets the periodicity and themes.

It must necessarily cover:

• the recruitment of senior employees;
• their continued employment;
• the planning of the end of careers, in particular the arrangements for phased retirement or part-time work;
• the transfer of skills within the company.

Companies with fewer than 300 employees are not subject to this obligation, but can voluntarily undertake a similar approach — a choice that can prove strategic in terms of employer branding and anticipating retirements.

The essential first step: a quantified diagnosis

No negotiations can begin without a preliminary assessment. This assessment must be based on relevant, quantifiable indicators, which may draw on data already available in the economic, social, and environmental database (BDESE). It must cover the company's specific situation on each of the four negotiation topics: recruitment, job retention, end-of-career planning, and skills transfer.

In practice, this diagnosis is not a mere formality: it is the document that the administration and trade union organizations can demand to verify that the negotiation was conducted in good faith, and it is also the element that will support the company's case in the event of an audit on the penalty.

The financial risk: a penalty on pension contributions

This is the least known—and most costly—point. The 2026 Social Security financing law introduces a financial penalty for companies that:

• do not open negotiations on the employment, work and working conditions of senior employees; or
• have not reached an agreement, nor have they put in place, failing that, an annual action plan to promote the employment of older people.

This penalty takes the form of an increase in employer contributions for old-age and survivor's insurance, collected directly by the Urssaf (French social security agency). Its amount will be set by decree, based on:

• efforts observed within the company to promote the employment of older workers;
• reasons for the failure, based on criteria that the administration will have to make public.

In other words, a company that has taken no action, without justification, is exposed to a heavier penalty than a company that attempted negotiations, even if unsuccessful, but documented. Prior assessment and traceability of the process therefore become, in effect, defenses.

What leaders and HR departments need to do now

For a company falling within the scope of the obligation, four actions must be taken without waiting for the decree setting the amount of the penalty:

1. Check its scope of application: workforce of 300 employees and more, presence of representative trade union sections, date of the last agreement or last negotiation on this subject.
2. Carry out the preliminary diagnosis, using the data already available in the BDESE rather than starting from scratch.
3. Open or formalize negotiations, or, failing agreement with trade unions, adopt an annual action plan addressing the four legal themes.
4. Keep evidence of the process (invitations to negotiate, reports, diagnosis, action plan): these are the elements that will make it possible to limit, or even avoid, the penalty in the event of an audit.

Why act before the decree is published?

The amount of the penalty is not yet known: it will be set by decree and adjusted according to each company's situation. However, the obligation to negotiate already applies. Waiting for the decree to be published before taking action means risking finding yourself, at the time of the audit, without any assessment or negotiations underway—that is, in the least favorable position to discuss the amount of the penalty.

ARTS Avocats assists HR departments and executives in ensuring the success of this mandatory negotiation: defining the scope of the preliminary assessment, drafting or reviewing the agreement or action plan, and ensuring compliance before the audit. Feel free to contact us to discuss your specific situation.

If you are facing a problem implementing social regulations, contact us.

Article written by Olivier Paquereau