We have written extensively about how French employers must plan and execute economic dismissals (licenciements économiques), or redundancies, without falling foul of the precise and highly complex legal structures in place.
To provide more in-depth clarification, this article takes a closer view of key components involved in the process. Note that redundancies are termed as “economic dismissals” in France because they must be based on a real and serious economic cause that is unrelated to the affected employees themselves. The two terms (redundancy and economic dismissal) are used interchangeably throughout this article.
1. What consultation must take place before proceeding with a redundancy plan?
For collective redundancies, the employer must consult the company’s Comité Social et Économique (CSE) if one exists, on the redundancy plan and its proposed application. For a single redundancy, no mandatory consultation is required.
The employer must give CSE representatives at least three days’ written notice of the date of the consultation meeting, and provide the following information:
- All relevant information about the proposed redundancy plan, including the specific reason and the number of employees affected.
- Anticipated measures for limiting the redundancies, such as retraining and/or redeployment.
During the consultation meeting CSE representatives may ask questions and gather further information about the plan. The committee must then submit its opinion on the proposed economic dismissals to the employer, within one month of the meeting.
The employer must then send the minutes from this meeting to the Directions Régionales de l’Économie, de l’Emploi, du Travail et des Solidarités (DREETS), which co-ordinate and implement various public policies – including those relating to employment and labour law – at the regional level.
Note that rules governing the number of CSE consultation meetings, when to inform the DREETS, and the level of information that must be provided change according to the size of the company and the number of economic dismissals planned.
2. Does the employer need to meet individually with employees being made redundant?
If 10 or more employees are made redundant within 30 days, the employer is not legally obliged to hold individual preliminary redundancy interviews (unless the employee is protected and/or the company does not have a CSE in place).
Otherwise, a preliminary interview (entretien préalable) is scheduled when redeployment is either not possible, or the employee has rejected this option.
Where an interview is required, the employee must be notified by registered letter, or hand delivery with receipt, of its location, date and time. Sent by the employer, this letter must also state:
- the interview’s purpose,
- the economic reasons for redundancy,
- that the employee may choose to be assisted by a colleague or external advisor, and
- contact details of the town hall and labour inspectorate, from which the employee may obtain a list of local advisors.
A minimum period of five working days must occur between receipt of the letter and the interview, in which the employee will be formally advised of the economic reasons for their redundancy.
3. What support is available to French employees affected by economic dismissal?
In companies with fewer than 1,000 employees, the entretien préalable should also include the offer of a Contrat de Sécurisation Professionnelle (CSP), in the forms of the presentation of an official document.
The CSP isa scheme that helps employees facing economic dismissal, by offering them enhanced support (such as training) and compensation as they prepare for alternative employment. These benefits are provided by France Travail, a government agency that assists unemployed people, for a maximum of 12 months following redundancy.
The employee will have 21 calendar days to decide whether or not they will accept the CSP. This 21-day period begins on the day after they receive the official document, so the employer should record proof of receipt during the preliminary interview. If the employee does not respond to the offer, this is automatically classed as a refusal.
If the employee accepts the CSP, their contract of employment will be terminated by mutual agreement at the end of the 21-day reflection period. If they refuse, they will be formally notified of their dismissal for economic reasons and be ineligible for any CSP-related benefits, although other forms of unemployment support may still be accessible.
If you would like any further information, or bespoke support on the complex subject of economic dismissals in your French company, please don’t hesitate to contact us.