LEGALINK CROSS-BORDER LAYOFFS QUESTIONNAIRE

Before proceeding to any layoffs, the employer has a legal obligation to research any redeployment (reclassifying) opportunities within the company group. The employer also has the obligation to define the criteria (as for example: age, family situation, abilities) to determine the order of the redundancies within the same category.

Measures governing the redundancy are codified in the Labor Code (“Code du Travail”) except when collective agreements (“convention collective”) are more favorable and in particular with regard to compensations (allowances).  The rules with regard to redundancy legal obligations depend on the number of employees whose redundancy is envisaged as well as the number of employees in the company.

The employees have a priority (if they wish) regarding any recruitment done by the company within the year following the year of their redundancy.

There are three types of redundancy procedure

- redundancy of one employee;
- redundancy from two to  nine employees in a 30 day period
- Redundancy of more than ten employees: In that case and if the company has more than 50 employees, the employer has to draw  up a job preservation plan submitted to the works committee ( “comité d’entreprise”).

a) As for any layoff the economic motivation must be clear.  . In this regard the economic motivation is defined by law for three issues and two issues were added by case law. The legal validity of the redundancy depends on the drafting of the letter of the redundancy which has to set up precisely the motivation in an absolute formal way which reproduce the terms of the law or case law.

b) Before any redundancy notification, there are compulsory consultations issues which depend on the number of redundancies envisaged and the number of employees in the company. There is either i) a preliminary interview of the concerned employees, or ii) a consultation of the staff representatives (délégué du personnel) and a preliminary interview or iii) a consultation of the works committee with regard to the job preservation plan.

c) Specific schedule must be followed according to the law or Collective agreements (provided collective agreements are more favorable than the law) or on a case by case basis a “redundancy methodology agreements” (accord de méthode) which cannot be less favorable than law or collective agreements.

The penalties differ according to the neglects committed by the employer:

a) Absence or not enough relevant job preservation plan: The employer has to pay the salaries that the laid-off employees should have been received for the period between the redundancy and the decision of Court stating in favor of the employees and has to reinstate the employee in the company, except when this one is closed or if the employee does not wish so. In these latter cases, the minimum is twelve months allowances.

b) Non compliance with the formalities of the procedure:  allowances are based on the damages, but as a general rule the law or the case law provide for the employee with a one month allowance.

c) Should the economic motivation be considered by the judge as being non-existent: allowances are based on the damages if the employee has less than two years of seniority in a company which employs less than ten employees bearing in mind that if the employee has at least two years of seniority and the company employs more than ten employees, the minimum allowance is six month