an alliance of employers’ counsel worldwide EMPLOYMENT LAW OVERVIEW FRANCE 2021-2022 Flichy Grangé Avocats / Proud Member of L&E GLOBAL EMPLOYMENT LAW OVERVIEW 2021-2022 / FRANCE | 1 www.leglobal.org TABLE OF CONTENTS. I. GENERAL OVERVIEW 03 II. HIRING PRACTICES 09 III. EMPLOYMENT CONTRACTs 12 IV. WORKING CONDITIONs 14 V. Anti-DiscriminAtion LAws 17 VI. PAY EQUITY LAWS 19 VII. SOCIAL MEDIA AND DATA PRIVACY 24 VIII. TERMINATION OF EMPLOYMENT CONTRACTs 25 IX. RESTRICTIVE COVENANTS 30 X. TRANSFER OF UNDERTAKINGS 32 XI. TRADE UNIONS AND EMPLOYERS ASSOCIATIONS 34 XII. EMPLOYEE BENEFITS 39 EMPLOYMENT LAW OVERVIEW an alliance of employers’ counsel worldwide 2021-2022 / FRANCE | 2 I. GENERAL OVERVIEW 1. INTRODUCTION In France, employment law affords employees a good level of protection. Nevertheless, this legal environment is constantly changing as a result of government reforms and case law evolution. Recent trends relate in particular to: (1) union representation and collective bargaining agreements; (2) working time; (3) mutual termination agreements; (4) senior management compensation; and (5) termination packages in listed companies. In France, choosing the wrong option may result in costly individual or collective litigation. • the Labour Code: made up of laws, regulations 2. KEY POINTS and decrees, the Labour Code determines nearly every aspect of French employment law. • All non-EU citizens need a work permit to work. • Case law: the provisions of the Labour Code are • Employers and employees are free to negotiate interpreted through decisions of the employment the terms and conditions of their employment law section of French the Supreme Court (“Cour relationship. However, employees have various de cassation”). minimum rights under the law, regardless of any • Collective Bargaining Agreements (“CBAs”) provision to the contrary in their employment (“Conventions collectives”): Collective contract. Bargaining Agreements are written agreements, • Usually, employees work 35 hours per week. Only entered into between one or more employee hours worked at the request of the employee’s representative trade unions and one or more superior will be regarded as overtime. employer representative organisations. They • Indefinite-term contracts: There must be real govern individual and collective employment and serious grounds for dismissal (two types of relationships, working conditions and employee valid grounds: personal grounds and economic benefits in a given industry (e.g., the chemical, grounds). banking and pharmaceutical industries). • Severance payments are only awarded if the Collective bargaining agreements can be binding employee has the minimum length of service and on all employers whose line of business is covered the relevant CBA provisions. by the agreement. • Collective company agreements (“Accords 3. LEGAL FRAMEWORK d’entreprise”): these agreements, which apply to specific companies, are signed by the employer Employment law in France is based primarily on the and, in principle, trade union representatives following sources, set out in order of priority: present in the company. • Atypical agreements: at company level, • the Constitution. agreements may be entered into with the staff • European legal instruments: consisting of EU law delegates or the Works Council rather than with (including Treaty provisions, EU regulations and trade union representatives and, in such a case, Directives and the case law of the European Court they are defined as “atypical agreements”. They of Justice) and the European Convention for the do not come under the category of collective Protection of Human Rights and Fundamental company agreements. They are considered Freedoms. binding by the case law as a “unilateral EMPLOYMENT LAW OVERVIEW an alliance of employers’ counsel worldwide 2021-2022 / FRANCE | 3 commitment” (“engagement unilateral”) of the B. IMPROVED CAPACITY TO BREAK employer. WITH SECTORIAL CBA’S • Common practices (“usages”): these are the general, fixed and constant practices of the employer. They concern, in particular, benefits Until recently, it was not possible to derogate to granted to employees and some details regarding sectorial CBA’s with a company-wide agreement, the operation of staff representative bodies. The unless it was more favourable for the employees. Company may revoke those common practices This has progressively changed, starting in 2008 at any time, subject to notifying the staff as far as working time is concerned, then in 2016, representatives and each individual employee and most recently with the Macron labour law concerned, along with respecting a reasonable reform that has created three different categories notice period (normally three months) between or “blocks”: the notification of the employees and the revocation of the common practice. “Block 1” matters: the sectorial collective agreement prevails over company agreements on a list of 11 topics. For example, minimum wage 4. NEW DEVELOPMENTS provided for by the CBA cannot be derogated by a company agreement. Recently, the French government has profoundly modified employment law in France, through the “Block 2” matters: the sectorial agreement prevails adoption of a major overhaul of key provisions of the over former company agreements if the sectorial French Labour Code. The key aspects relate to the CBA provides for it. This concerns 4 topics. For simplification of the staff representative structures example, policies regarding the insertion of and significant efforts to secure dismissals. There handicapped individuals into the workforce. are plenty of other measures of importance, as detailed below. This reform accelerates the trends All other subjects not included in the previous two already initiated under President Hollande through blocks constitute “Block 3”: Company agreement three major labour laws respectively entered into prevails over the sectorial CBA. in June 2013, August 2015 and August 2016. C. NEW MAJORITY RULES FOR A. CHANGES TO NEGOTIATING ENTERING INTO A COMPANY COLLECTIVE BARGAINING COLLECTIVE BARGAINING AGREEMENTS AgREEMENT By way of background, it should be noted that in Under French law, company agreements are France, employers must comply with the labour entered into by the employer and the Union code, but also with the applicable sectorial delegates (being employed in the company) having collective bargaining agreement (CBA), if any. A been appointed by Unions based on the results of sectorial CBA is a collective bargaining agreement the votes in the first round of the last elections of entered by Unions representing employees on the works council (only unions are able to present the one hand and Unions representing employees candidates over this first round). on the national level in a defined business sector. Once extended by the Labour ministry, it becomes The principle of the majority collective agreement mandatory for any company whose activity falls applies to all company agreements as of 1 May within the scope defined by the agreement. On 2018: to be valid, the agreement must then be the other hand, a company may always enter into signed by one or more trade unions that received company collective bargaining agreements with 50% of the votes cast. Unions being present in said company. The Macron reform provides for some important changes in this However, if the signatory representative trade area. union organisations only have 30 to 50% of the votes, it is possible to then use a new backup EMPLOYMENT LAW OVERVIEW an alliance of employers’ counsel worldwide 2021-2022 / FRANCE | 4 plan: revert to a company referendum meaning Topics that can also be set out by agreement: that all the employees’ opinions in relation to the agreement may be sought in order to render the • the frequency of compulsory negotiations (up to agreement enforceable. 4 years); • the calendar and meeting places; Increased Capacity to Enter Into a Collective • information provided by the employer (or Bargaining Company Agreements in Small employers’ organisations) and the date of Companies or Without Trade Unions delivery; • the procedures for monitoring the commitments In France, some matters require a collective entered into by the parties. agreement, such as the recourse to specific working time arrangements. Small businesses without Such a company agreement is concluded for a unions were struggling to enter into an agreement maximum duration of 4 years and can set the where needed. The Macron reform has therefore periodicity of its renegotiation. facilitated the ability to enter into an agreement, by enabling to sign, if no union would appoint D. STAFF REPRESENTATION: THE an employee, with an elected staff member or even with the workforce directly, under a certain csE (thE social AnD Economic conditions. committEE) Securisation of Companies’ CBA The Macron Reform has significantly simplified staff representation in companies. Up to now, there have Since case law can be quite unpredictable been three types of staff representative bodies, all and because changes are commonplace, the of which are chaired by the employer: Government wished to protect employers against consequences of a ruling invalidating an agreement • in companies with 11-49 staff: staff delegates or some of its provision, which would then trigger (délégués du personnel); consequences for the future, but also for the past, • in companies with 50 and above: staff delegates, a as it is admitted that civil case law has a retroactive works council and a health and safety committee.