Actance Tribune
What's NEW under French Employment Law?
N° 2 – February 7, 2022
The Macron Scale
Parting with an employee is never easy.
The individual working relationship can be terminated by mutual agreement (individual conventional termination), by the employee (resignation, etc.), or by the employer (dismissal).
In the event of dismissal, the employer must afford the mandatory severance payments (for example: termination indemnity).
When a dismissal is disputed before the Labour Court (Conseil de prud’hommes), since 2017, French law states that any employee whose dismissal was justified by reasons that considered invalid is entitled to an indemnity.
The amount of this indemnity depends on the seniority acquired in the company and will vary according to the damages suffered and demonstrated by the employee. It varies between a set minimum and maximum as defined by the Labour Code (see part in orange below).
The legal scale is not applicable when the dismissal is judged as invalid, that is to say, identified as an attack on fundamental employee liberties (for example: discrimination, moral or psychological harassment).
As a result, employees are increasingly regularly invoking such an infringement in order to circumvent the application of the scale, as well as making additional demands relating to back pay (for example: overtime, contestation of the validity of the system for counting the executive working times (time counted in days), compensation for the loss of opportunity to exercise stock options, RSU, LTI, compensation for costs related to teleworking, etc.).
Company developments concerning the use of telework
During the sanitary crisis, teleworking developed quickly in France. This approach has become a strong argument for attracting new talents to companies while developing a quality employment policy.
Supervising this new way of working allows to define a common set of rules for all employees in order to specifically identify :
- employees and positions eligible for teleworking;
- the related procedures (number of days, employee location, etc.);
- the methods of controlling working time or distribution of the workload;
- the terms and conditions for covering the costs resulting from teleworking.
This framework may take the form of an agreement negotiated with trade union organisations or a document drawn up unilaterally by the employer.
The introduction of teleworking raises new and unprecedented concerns (for example: employees wishing to telework from abroad or employees teleworking full-time).
The problem of controlling the teleworking time and the workload as well as the prevention of psychosocial risks (linked to the isolation of teleworkers) deserve particular attention. Indeed, this control must be suitable to all the working time arrangements put in place within a company (employees on hourly rates vs. employees on an annual flat rate defined in days) which are subject to different legal systems.
The issue of covering the costs associated with the introduction of teleworking also needs to be carefully handled in order to secure the company.
Actance supports many clients in the development of internal company standards allowing the development of teleworking.
Collective Transitions scheme (Called Transco)
France has an increasingly comprehensive toolbox to help companies through their transformation and reorganisation processes.
In January 2021, the Collective Transitions (“Transco”) system came into effect. It is a new measure to support the development of jobs and business activity.
It is part of a support plan for businesses and employees to deal with the health crisis.
The objective is to support companies that are facing economic changes: the system supports employees whose employment is undermined by allowing them to follow a long training course to retrain for a promising local profession.
Currently, when the system is introduced and approved by the administrative body, the State covers the employee remuneration and the cost of training.
This system designed to help keep employees in employment thus allows companies to transform while avoiding the costs and constraints of economic layoffs.
There is a whole series of tools in France to adapt employment to the development of company activity and the economic context in which it operates :
- mechanisms for collective employment contract termination (French acronyms : PSE, RCC);
- support measures, alternatives to the termination of the employment contract, creating possibilities to cope with changes in jobs and the company’s activity (French acronym : GEPP);
- systems designed to adjust working hours, employee pay and to encourage employee mobility temporarily or permanently to meet company needs (French acronym : APC).
These systems, except for the PSE, require the conclusion of a collective agreement between the employer and the representative trade unions. However, if there is no such agreement, it is still possible for the employer to adopt certain measures.