Actance Tribune
What's NEW under French Employment Law?
N° 18 – July 11, 2023
Simply exceeding the maximum daily working time necessarily causes harm to employees
In a judgment of May 11, 2023 (No. 21-22.281), the Court of Cassation ruled that the simply exceeding the maximum daily working time of 10 hours of work entitles the employee to compensation, without the latter needing to prove that this actually caused them harm.
In the case, an employee made several claims with the Labour Court against their employer following the termination of their employment contract, including a claim for damages for non-compliance with the maximum of 10 daily working hours.
The Paris Court of Appeal, based on the case law of the Court of Cassation of 2016 according to which “the existence of damages and the related assessment fall under the sovereign power of assessment of the trial judges (Court of Cassation – social division, April 13, 2016, n°14-28.293), had dismissed their request on the grounds that they did not demonstrate damages suffered (Paris CA, Dec. 2, 2020, n°18/09158).
Subsequently however, the Court of Cassation admitted certain exceptions, awarding the employee compensation without providing proof of damages. For example, concerning working hours, the Court of Cassation recently ruled that exceeding the maximum weekly working time necessarily causes harm to the employee (Court of Cassation – social division 26 Jan. 2022, n°20-21.636).
In this case, the decision is thus overturned by the Court of Cassation, adding a new exception by ruling that simply exceeding the maximum daily working time gives the employee the right to compensation.
The Court of Cassation reverses case law by reinforcing protection for employees who denounce moral harassment
In a judgment on April 19, 2023 (No. 21-21.053), the Court of Cassation reviewed its case law concerning the protection of employees who report moral harassment by removing the obligation for the employee to describe relevant acts as moral harassment.
As a reminder, article L.1152-2 of the French Labour Code establishes immunity for the employee who denounces acts of moral harassment, by prohibiting the employer from sanctioning or dismissing them for having testified or having reported them. Article L.1152-3 of the French Labour Code states that any termination of the employment contract in breach of the aforementioned provisions is liable to nullity.
In a judgment of September 13, 2017, (n°15-23.045), the Court of Cassation had specified that, in order to be able to benefit from such protection, the employee had to expressly describe the acts of moral harassment.
In the above-mentioned judgment of April 19, 2023, the Court of Cassation deviated from its 2017 case law, now considering that “an employee who denounces acts of moral harassment cannot be dismissed for this reason, even if they have not described these acts of moral harassment when they are reported, except in bad faith, meaning that the employee knows that the facts that they denounce are untrue”.
The solution identified by the Court of Cassation only applies “should the employer be not legitimately be able to ignore, upon reading the written notification sent by the employee which justified their dismissal, that the latter denounced many acts of harassment”.
Given that the Court of Cassation does not provide any details on these acts, it is thus the trial judges who must verify the obvious nature of the report of harassment in the writings produced by the employee, even if the term “moral harassment” be not actually used.
The possibility for the employment contract to provide for the partial reimbursement of an arrival bonus in case of resignation
Arrival bonuses, sometimes called the “golden hello” or even “welcome bonus”, are a standard practice for attracting employees in certain sectors (such as banking) compensating for the bonus that certain employees may lose when they leave their previous employer.
In the judgment of May 11, 2023 (n°21-25.136), the Social Division of the Court of Cassation recognises for the first time the possibility of having the right to the acquisition of the entire arrival bonus subject to a condition of employee presence after payment.
In this specific case, an employee resigned 14 months after signing their employment contract, which provided for the payment of a gross “initial bonus” of €150,000 within 30 days of taking up duties. It was nonetheless provided for that “should the employee resign or be dismissed for serious or gross negligence at the end of the third year from the start date, the employee can retain 1/36th of the arrival bonus for each full month of work after the start date. The remainder of the initial premium shall be refundable to the company on the date of the termination or on the day on which notification of the dismissal is made, whichever is the closest of the two dates.
Following resignation of the employee, the employer brought before the Labour Court a request for partial reimbursement of the amount received as an arrival bonus. This was nonetheless dismissed by the Paris Court of Appeal who ruled that: “The right to bonus may be subject to the employee’s membership of the company at the time of its payment but cannot be subject to their presence on a date after its payment because this interferes with the freedom to work” (CA Paris, September 9, 2021, n°19/02239).
The Court of Cassation quashed and annulled the Court of Appeal judgment on the grounds that “a clause agreed on between the parties, whose purpose is to retain the employee for whom the employer wishes to ensure long-term employment, without unjustifiably and disproportionately impairing the freedom to work, can allow the acquisition of all the arrival bonus, independent of the remuneration for the employee’s work, subject to a condition that the latter be present at the company for a certain period after payment and provide for the reimbursement of the bonus in proportion to the time that the employee, due to their resignation, will not have spent in the company before the scheduled expiry date ».
Thus, as well as attracting employees, these mechanisms can also help to retain employees.
Precaution to consider when drafting the clause:
Firstly, as its definitive acquisition is deferred in time and its reimbursement may be requested in case of premature resignation, the benefit must be “independent of the remuneration for the employee’s work” and be “for the purpose of retaining the employee for whom the employer wishes to ensure long-term employment ». Practically speaking therefore, the incentive bonus must be added to the salary paid in return for the work, in order to avoid any confusion.
Secondly, the Court of Cassation recognises the validity of the clause given that the reimbursement in case of resignation does not include the entire amount received but depends on “the time that the employee, because of their resignation, will not have spent with the company before the scheduled deadline« . A clause which would provide for the full reimbursement of the premium before the due date, regardless of the duration spent by the employee in the company, would risk being deemed as unlawful and a disproportionate attack on the freedom to work.
Finally, great care is required given that the above-mentioned judgment of May 11, 2023 only concerns the reimbursement of the retention bonus by the employee only if the employee resigns. It is not clear if the Court of Cassation would accept the validity of an obligation to reimburse a retention bonus in case of dismissal, especially if it were to be judged not to have real and serious causes (indeed it has already been ruled that the condition of presence is deemed to have been fulfilled when the employer has prevented its fulfilment (Court of Cassation – Social division, May 27, 2020, no. 18-20.156).