Newsletter No. 90 – June 2016

While case-law used to consider that a non-compete provision deprived of any financial consideration necessarily caused a prejudice to the employee, the Supreme Court significantly amends its case-law. Henceforth, they consider that “the existence of a prejudice and the assessment of such prejudice fall within the exclusive scope of jurisdiction of the judges ruling on the merits”. In this case, the latter judges had noted that “ the employee suffered no prejudice from the illegality of such non-compete provision”, so that the employee’s claims for indemnification in this respect had to be dismissed (Supreme Court, Lab. Section, 25 May 2016, n°14-20.578).

 

Henceforth, the Supreme Court considers that “ it is incumbent upon the judges to assess whether the employee puts forward facts that enable to presume the existence of harassment and whether the employer proves that the acts invoked by the employee do not result from harassment” (Supreme Court, Lab. Section, 8 June 2016, n°14-13.418).

An employee, whose employment contract had been transferred pursuant to the provisions of Article L. 1224-1 of the Labour Code, was dismissed for refusing to change her place of work. Both the judges ruling on the merits and the Supreme Court consider that, when “the application of Article L. 1224-1 of the Labour Code triggers an amendment to the employment contract other than the change of employer, the employee is entitled to object thereto; that it is incumbent upon the transferee, in case they are not in a position to maintain the previous conditions, either to make new offers, or to draw all consequences from such refusal by starting a dismissal procedure”, a dismissal which will be based upon a real and serious ground (Supreme Court, Lab. Section,1^st June 2016, n°14-21.143).

Until now, case-law considered that the employer was in breach of their obligation to achieve security of their employees when an employee was the victim, on their place of work, of moral or sexual harassment, even when the employer took measures to have such harassment stopped. The Supreme Court significantly amends their case-law by accepting, from now on, that “an employer proving that they have taken any and all prevention measures as required by Articles L. 4121-1 and L. 4121-2 of the Labour Code and who, once informed of the existence of facts such as to constitute moral harassment, have taken immediate measures to have such harassment stopped, is not in breach of the statutory obligation imposed on them to take the necessary measures to ensure security and protect the physical and mental health of workers” (Supreme Court, Lab. Section, 1^st June 2016, n°14-19.702).

Pursuant to a tripartite transfer agreement, the employment contract of an employee with her initial employer was terminated and a new employment contract with the buyer was entered into. The employee was dismissed two months thereafter by her new employer and brought various claims before the labour court. The judges ruling on the merits notably considered that the termination of the employment contract between the employee and her first employer was an unjustified dismissal because “termination of the employment contract resulting from the agreement of the parties can only occur in the conditions provided for by the provisions governing the mutually agreed-upon termination (“rupture conventionnelle”)” and that in this case such procedure had not been complied with. The Supreme court reversed the decision of the court of appeal, on the ground that “the provisions […] relating to the mutually agreed-upon termination between an employee and their employer are not applicable to a tripartite agreement entered into between an employee and two successive employers which aimed at organizing the continuance of the employment contract and not its termination” (Supreme Court, Lab. Section, 8 June 2016, n°15-17.555).

An employee claimed indemnification for her unjustified dismissal on the ground that, where it triggers an amendment to the employment contract, the redeployment offer made to the employee whose economic dismissal is contemplated is subject to a one-month time period to enable the employee to make a decision. According to the Supreme Court, such formality, resulting from the provisions of Article L. 1222-6 of the Labour Code, is not applicable when the employer’s offer to amend the employment contract is made as part of the redeployment obligation within the framework of a dismissal based on an economic ground (Supreme Court, Lab. Section, 15 June 2016, n°15-12.504).

 

Pursuant to Article L. 1242-13 of the Labour Code, “the [fixed-term] employment contract is handed over to the employee, at the latest, within two working days following hiring”. Failure to comply with these provisions triggers the recharacterization of the fixed-term employment contract into an indefinite-term employment contract (Supreme Court, Lab. Section, 17 June 2005, n°03-42.596). For the Supreme Court, the fact that the hiring declaration was made within such time period cannot replace the obligation resulting from the aforementioned provisions (Supreme Court, Lab. Section, 8 June 2016, n°15-14.001).

In order to fight against discrimination caused by social insecurity, the legislator has inserted sanctions in the Labour Code and the Criminal Code in case of discrimination because of “specific vulnerability resulting from apparent or known economic situation” of an individual. Moreover, a new Article L. 1133-6 is added in the Labour Code, pursuant to which “the measures taken in favour of vulnerable individuals because of their economic situation and aiming at equal treatment do not constitute any discrimination” (L. n°2016-832 of 24 June 2016, Official Journal of 25 June).