Newsletter No. 75 – March 2015

Three decisions handed down by the Supreme Court provide clarifications on the effects of a mutually agreed termination entered into after the notification of a dismissal. In the first case, the Supreme Court ruled that “if the employment contract was terminated as a result of one of the parties exercising its right of unilateral termination, the subsequent signing of a mutually agreed termination document shall be deemed as a joint waiver of the prior termination.” Accordingly, a mutually agreed termination document can be validly signed after a dismissal or a resignation, which will therefore not take effect. In the second case, an employee was convened to a pre-dismissal meeting in view of disciplinary dismissal, during which a mutually agreed termination document was signed. As the employee later changed his mind, the employer resumed and completed the dismissal procedure. The Supreme Court decided that “the signing of a mutually agreed termination document by the parties to the contract of employment, after the initiation of a disciplinary dismissal procedure, does not entail a waiver by the employer to exercise its disciplinary authority.” The dismissal procedure can validly be resumed if the employer complies with the two-month limitation period. The third case enabled the Supreme Court to specify that “the signing by the parties of a mutually agreed termination document does not constitute an act that interrupts the limitation period”, as it is the case when an employee is convened to a pre-dismissal meeting. In this case, more than two months passed between the mutually agreed termination (followed by a change of mind by the employee) and the notice to attend a pre-dismissal meeting (Cass. Soc., 3 March 2015, No. 13-20.549, 13-15.551 and 13-23.348).

A female employee reported the psychological and sexual harassment of which she had been the object over several months by her team manager. The guilty male employee was dismissed for gross misconduct. The female employee requested the termination of her employment contract a year later, attributing a state of anxiety and depression resulting from the harassment suffered. The Supreme Court considered that the mere occurrence of actions of psychological or sexual harassment on the work site is a breach of the employer’s obligation to secure a specific protection result, “even if it took measures to put an end to these actions.” As the existence of the breach was established, it was the responsibility of the trial judges to determine if the harassment suffered had prevented the continued application of the employment contract. Accordingly, termination requested by the employee can be justified even if the acts have ceased, as a result of psychological consequences or due to a tense environment resulting from the reporting of the facts (Cass. Soc, 11 March 2015, No. 13-18.603).

An employer had unilaterally released an employee from his non-competition obligation during the contract’s performance. A few months later, the employee was dismissed and demanded the payment of the financial counterpart of his non-competition clause. The Supreme Court ruled in the employee’s favour, on the ground that the non-competition clause only defined a waiver period that began as of the termination of the employment contract. Thus, “the employer cannot, unless otherwise stipulated, unilaterally waive this clause, during the performance of this agreement”, as said clause was included in the common interest of the parties. Accordingly, the waiver can only take place at the time of the termination of the employment contract, in conformity with the stipulations of said clause (Cass. Soc., 11 March 2015, No. 13-22.2

A female employee who had been dismissed on economic grounds accepted the “contract for the security of professional employment” (contrat de sécurisation professionnelle), and later challenged her dismissal. The employee was of the opinion that the employer’s failure to organise the elections of the employee representatives had prevented her from being assisted during the pre-dismissal meeting. The Supreme Court allowed this argument, arguing that “adherence to a contract for the security of professional employment constitutes a dismissal procedure on economic grounds and does not prevent the employee from obtaining indemnification for the loss caused to him/her by the unlawful nature of the letter inviting the employee to a pre-dismissal meeting” (Cass. Soc., 17 March 2015, No. 13-26.941)..

From now on, the financial aid of € 4,000 in the case of the generation contract shall be granted to companies employing less than 300 employees as regards the new open-ended apprenticeship contracts created by the French “Training” Act of 5 March 2014. The age of the employee, who must be below the age of 26, is determined on the first day of the performance of this contract following the expiry of the apprenticeship period. To incentivise companies to implement the “generation contract”, the decree eliminated the provisions regarding the obligation to submit the prior analysis to the Labour Administration (Direccte), as the Training Act had already eliminated the prior obligation to enter into a collective agreement, to draw up an action plan or to be covered by an industry-wide agreement (D. No. 2015-249 of 3 March 2015, JO of 5 March)..

In May 2014, the Supreme Court decided that individual day-per-year all inclusive agreements entered into on the basis of the Collective Bargaining Agreement of Firms of Chartered Accountants and Statutory Auditors were not likely to ensure the protection of the health and safety of employees. The negotiation between employer and employee representatives resulted in an amendment “regarding the annual calculation of the annual number of working days.” It provides for up to 218 working days a year, with a reasonable workload that cannot exceed 5 days a week and 23 days a month. It also established the right for employees not to comply with any and all work requests. Each employee covered by such an agreement must prepare a monthly statement that can be used to track the number of days s/he has worked. This statement must be examined by her/his employer, as well as at the annual evaluation meeting. The employee and his/her employer can define a compensation for an unexpected excessive workload. The remuneration of those employees who work a fixed number of working days each year was also increased as of 1 April 2015 (Amendment 24 bis of 18 February 2015).