Newsletter 69 – September 2014

The provisions of Article L. 1237-5 of the Labour Code allow the employer to retire an employee who has attained an age set by the French Social Security Code and is entitled to a full pension. In this case, an employee retired by their employer initiated proceedings before the labour court seeking to reclassify the termination of their employment contract as dismissal without cause. The lower courts rejected the employee’s application on the grounds that they failed to show that they were unable to receive a full pension at the time of their compulsory retirement. The Supreme Court quashed this ruling, holding that “employers invoking the possibility for a company to terminate an employment contract of an employee entitled to a full pension must prove that the conditions of the employee’s compulsory retirement have been met” (Cass. Soc., 17 September 2014, no. 13-14.944).

Following an inspection by the labour inspector, a company was sued for undeclared labour, on the grounds that “the time spent by employees travelling from the home of a customer to another during the same working day was not included when calculating their wages.” The employer was acquitted in the first instance before finally being convicted of undeclared labour by the Court of Appeal, whose ruling was upheld by the French Supreme Court. According tothe court, “the time spent travelling for business from the house of one customer to that of another during a same day represents effective working time and not a break, insofar as employees are not released from the authority of their company’s manager during such travel” (Cass. Soc., 2 September2014, no. 13-80.665).

Article L. 3122-32 of the Labour Code provides that “the use of night work is exceptional in nature and takes into account the need to protect the health and safety of workers and is justified by the need to ensure continuity of economic activity or socially useful services.” The Supreme Court reasserted this exceptional nature in two cases. In the first case, a company was found guilty on the basis of these provisions of illegally instituting night work, on the grounds that two employees were carrying out a portion of their activities after 9.00p.m. The Court of Appeal and later the Criminal Chamber of the Supreme Court stated that “whereas the two employees concerned were not night workers within the meaning of Article L. 3122-31 of the Labour Code, a portion of their work after 9.00 p.m. nevertheless constituted night work, which must remain exceptional in nature.” (Cass. Crim, 2 September 2014, no. 13-83.304). In the second case, the Social Chamber of the Supreme Court pointed out that “night work may not be the normal mode of work organisation in a company and must be implemented only when essential to the company’s operation.” In the case at hand, the court noted that the company Sephora “did not demonstrate that no other working time arrangements were conceivable or that its business required night work to be carried out” (Cass. Soc. 24 September 2014, no. 13-24.851).

As of 1 January 2016, companies must put in place complementary health insurance coverage for the benefit of their employees. At a minimum, such coverage must include:
– the full co-payment payable by the policyholders;
– hospital daily fixed fees;
– dental expenses up to 25% in excess of the approved rates;
– optical expenses, in the form of a two-year standard rate in a minimum amount of 100 euros for simple corrections, 150 euros for combined simple and complex corrections and 200 euros for complex corrections.

In their unilateral decision establishing minimum coverage, employers may provide the possibility for certain employees to be exempted from the arrangements at the employees’ initiative (D. no. 2014-1025 of 8 September 2014, JO of 10 September).

From now on, employers planning to consult the works council on training initiatives are no longer required to provide the works council with the 2483 tax return certifying in particular that the company has made payments to the collection agencies. Since the Act of 5 March 2014 on vocational training, employment and social democracy, the employer’s declaration to the administrative authorities attesting that it participates in the development of vocational training has been replaced by the company’s transmitting information relating to the methods to be used by its employees to access vocational training (D. no. 2014-1045 of 12 September 2014, JO of 14 September).

As of 1 January 2015, the statutory interest rate will be calculated every six months “on the basis of key interest rate of the European Central Bank for refinancing operations and the rates charged by credit institutions and finance companies” (new Article L. 313-2 al. 2 of the Monetary and Financial Code). Two separate rates will be set depending on whether or not the creditor is “an individual not acting for business purposes.” A decree will determine the procedures for calculating and notifying these rates (Ord. no. 2014-947 of 20 August 2014, JO of 23 August).

Financial aid in the amount of 4,000 euros is awarded to companies that hire under an indefinite employment contract either a young person under 26 or a young person under 30 recognised to be a disabled worker and which, at the same time, maintain in an indefinite employment contract an employee aged 57 or over. This aid is increased to 8,000 euros for companies that hire under an indefinite contract a young person under 26 while, at the same time or at least six months prior to this recruitment, hiring an employee aged 55 or over (D. no. 2014-1046 of 12 September 2014, JO of 14 September).