Overtime in France: Reductions, Deductions and Tax Exemptions — The Payroll Traps to Avoid

Overtime exemptions only apply to genuine overtime — hours worked beyond 35 hours. Three very common situations trip up payroll: a contractual working week shorter than 35 hours, a week that includes an absence, and the interaction with the specific flat-rate deduction (déduction forfaitaire spécifique, or DFS). Here is an overview, from the employer’s perspective.

This article is part of our dossier Payroll Law: The Employer’s Guide.

Reminder: what qualifies as overtime?

The statutory working time is 35 hours per week. Overtime consists of hours worked beyond 35 hours (Article L. 3121-28 of the French Labour Code). A shorter contractual working week (e.g. 32 hours) does not, on its own, turn the hours between 32 and 35 into overtime: they remain ordinary hours, unless a collective agreement or the employment contract provides for more favourable treatment.

1. Contractual working week shorter than 35 hours

In principle, the hours between the contractual working week (e.g. 32 hours) and 35 hours do not qualify for:

the reduction in employee social security contributions — reserved for overtime under Article L. 241-17 of the French Social Security Code (referring to Articles L. 3121-28 et seq. of the Labour Code);
the flat-rate employer deduction — which targets “any overtime hour worked” (Article L. 241-18 of the Social Security Code);
the income tax exemption — Article 81 quater of the French General Tax Code exempts the remuneration referred to in Article L. 241-17 of the Social Security Code.

The BOSS (Bulletin officiel de la Sécurité sociale, the official social security guidance) confirms this: for full-time employees, the exemptions target hours worked beyond the statutory working time.

2. A week with an absence: it all depends on the nature of the absence

Ordinary absence (illness, unpaid leave, unpaid absence): hours paid at the standard rate are not overtime → no exemption.
Paid leave — point of caution: since the French Supreme Court (Cour de cassation) ruling of 10 September 2025, for an employee whose working time is calculated on a weekly basis, paid leave days may have to be counted towards the threshold triggering overtime. Some hours may therefore become overtime as a matter of law. However, the effect of this reversal on entitlement to the social and tax exemptions has not yet been the subject of explicit administrative guidance: exercise caution in payroll processing.

3. Income tax exemption and the DFS: before or after the flat-rate deduction?

The specific flat-rate deduction (déduction forfaitaire spécifique, or DFS) reduces the base of certain contributions, but not CSG/CRDS (the general social contributions). The tax exemption on overtime therefore cannot be calculated on the basis of contributions after the DFS. Example: gross remuneration of €2,000 (overtime included), a 10% DFS reducing the contribution base to €1,800 → the tax base is not €1,800. The calculation is carried out according to the rules governing taxable net pay, with CSG/CRDS determined without applying the DFS.

Frequently Asked Questions

Are hours between 32 and 35 exempt? No, in principle (these are ordinary hours).

A week with an absence? No exemption for an ordinary absence; caution regarding paid leave (Cour de cassation, 10 September 2025).

Income tax exemption and the DFS? Calculated on taxable net pay, not on the base after the DFS.

Written and supervised by Audrey Mourer, Operations Director and Head of the Payroll Advisory Practice at DAIRIA Avocats.