Conventional termination: procedure, compensation and taxation in 2026

Updated in March 2026 - Conventional termination is the amicable procedure allowing an employer and an employee to mutually agree on the termination of the permanent employment contract (CDI). Since its creation in 2008, it has become one of the most used termination methods in France, with more than 500,000 agreements approved each year. Here's everything you need to know in 2026.

Conventional termination is a legal mechanism provided for by article L. 1237-11 of the Labor Code. It is exclusively reserved for permanent contracts and cannot be imposed by either party.

Its key features:

• ▸Bilateral agreement: the initiative can come from the employee or the employer
• ▸Employee protection: right to unemployment benefit (ARE)
• ▸Compulsory approval by DREETS
• ▸Specific compensation at least equal to the legal severance compensation

Hayot Expertise Advice: Conventional termination is not suitable for all situations. In the event of an underlying dispute (harassment, discrimination), other measures may prove more protective. Consult an expert before starting the procedure.

1. The preliminary interview

• ▸At least one interview must take place between the employer and the employee
• ▸Each party can be assisted (by a member of staff or an external advisor in structures without staff representation)
• ▸There is no legal obligation to summon by registered letter, but it is a good practice to secure the procedure

2. Signing the agreement

• ▸The agreement specifies the amount of compensation and the desired break date
• ▸It must be signed by both parties
• ▸It is drawn up in two original copies (one for each party)

3. The withdrawal period

Both parties have a period of 15 calendar days from the day after signing to withdraw, without having to justify themselves.

4. Approval by DREETS

At the end of the withdrawal period, one of the parties transmits the agreement to the DREETS (Regional Directorate of Economy, Employment, Labor and Solidarity) via the dedicated Cerfa form.

DREETS has 15 working days to:

• ▸Approve the agreement (tacit approval in the absence of a response within this deadline)
• ▸Or refuse it if the legal conditions are not respected

5. Effective termination of the contract

The termination takes effect the day after the day of approval (or the expiration of the period if tacit approval). There is no notice requirement.

To learn more about your obligations as an employer, see our guide to employer HR and payroll obligations in 2026.

Legal minimum amount

The compensation cannot be less than the legal severance pay, calculated as follows:

• ▸1/4 month of gross salary per year of seniority for the first 10 years
• ▸1/3 month of gross salary per year of seniority beyond 10 years

The reference salary is the most favorable between:

• ▸The average of the last 12 months of gross salary
• ▸The average of the last 3 months (including pro rata premiums)

Calculation example

An employee with 8 years of seniority and a gross monthly salary of €3,000:

Minimum compensation = 8 × (€3,000 × 1/4) = €6,000

The parties can freely negotiate an amount higher than the legal minimum.

Specific employer contribution since 2024

Since January 1, 2024, the employer is liable for a specific employer contribution of 30% on the amount of the conventional termination compensation (within the limit of the fraction exempt from social security contributions). This rate was raised to finance unemployment insurance.

The conventional termination, although consensual, can expose the company to legal risks in the event of non-compliance with the procedure. Our firm supports you in:

• ▸Check the legality of your approach
• ▸Accurately calculate the compensation due
• ▸Manage payroll and declaration aspects (France Travail certificate, balance of all accounts)

👉 Discover our social and payroll service

For the employee

The conventional termination compensation is exempt from income tax up to the highest of the following amounts:

• ▸2 times the gross annual remuneration received by the employee during the calendar year preceding the termination
• ▸The amount of legal or conventional compensation

Exemption from social security contributions up to the same limit, provided that the employee is not entitled to benefit from a full-rate retirement pension on the termination date.

For the employer

The specific contribution of 30% is recovered by Urssaf on the portion of the compensation exempt from social contributions. It constitutes a charge deductible from taxable income.

One of the major advantages for the employee: the possibility of receiving the Return to Employment Allowance (ARE) paid by France Travail (formerly Pôle Emploi).

The employee can register with France Travail from the day after termination of the contract. A deferred compensation period (waiting period) is applied depending on the amount of supra-legal compensation received.

For a complete vision of the financial management of your company, explore our article on financial management and KPIs for SMEs.

Conventional termination is a valuable flexibility tool, provided that the procedure is scrupulously respected and the compensation correctly calculated. In 2026, the employer contribution of 30% reinforces the importance of expert support to control the total cost and secure each stage.

📞 Are you considering a conventional break? Our firm supports you to secure the procedure and optimize your HR management. Make an appointment with an expert

(Reference sources for this file: Labor Code (Légifrance), Urssaf, Ministry of Labor)