“Redundancy” is itself a redundant term in French businesses. Employee redundancies are called “economic dismissals” because their reasons must always be purely economic.
This, along with the stringent legal procedures French employers must follow in order to conduct economic dismissals, means redundancies are far less common in France than they are in the UK and other countries.
The redundancy process in French companies can be briefly summarised as follows (please see this article for more detailed information about each step):
- Create a job pool
- Define the selection criteria for redundancy
Each step comes with specific and intricately detailed legal conditions that must be closely and carefully followed. Employers must also implement all possible measures to avoid economic dismissals at all, regardless of the size of the company or the number of redundancies planned.
Only after all appropriate measures have been considered, will the employer invite employees to a preliminary interview (entretien préalable), which must be done by registered letter (or hand delivery with receipt).
During their entretien préalable, the employee should be informed of:
- the economic reasons for the redundancy decision,
- the possibility of their benefiting from a contrat de sécurisation professionnelle (CSP) via an information document and acceptance form (the employer should retain proof of handing this information to the employee).
A CSP is offered to employees at risk of redundancy, in companies employing fewer than 1,000 staff. It enables up to 12 months’ access to a selection of benefits from France Travail, which is a government agency that registers and assists unemployed people.
Following their interview, the employee will have 21 days to decide whether they would like to accept the CSP.
During this period of reflection, employees may also arrange an information interview with France Travail to learn more about the specific benefits provided under the CSP. Acceptance of the CSP means the employee’s contract will be terminated by mutual agreement at the end of the 21-day reflection period, with no need for a dismissal letter although it is preferable to avoid any misunderstanding.
A dismissal letter (lettre de licenciement économique) can be sent to each affected employee, by registered letter with acknowledgement of receipt, after a minimum period of seven days following their meeting.
(Note: for economic dismissals involving cadres, or executives, this period is extended to 15 days).
The lettre de licenciement économique should confirm the economic reasons for dismissal and the possibility of benefiting from a CSP (if the employee has not yet decided). It should also state that if the CSP is refused, the letter will then constitute formal notification of the employee’s dismissal.
Finally, the letter must inform the employee that they may benefit from a priority of re-employment for one year from the date of their contract ending, along with any associated conditions.
The employee must then notify the DREETS, which is the regional labour administration, within eight days of sending the employees’ letters.
What happens at the end of the employee’s contract?
The employee’s contract does not end immediately after they have received their dismissal letter. Their contracted notice period still applies, and is usually worked unless the employer chooses to waive this requirement, or the employee has accepted a CSP.
The contract is then terminated at the end of the notice period, on which date the employee will receive the following sums (if applicable):
- redundancy and severance pay,
- compensation for their notice period and unused paid leave (if the employee accepted a CSP, the notice period compensation is instead due to France Travail),
- any financial compensation due under a non-compete clause.
The employee must also be provided with mandatory exit documents, including the solde de tout compte (a receipt for all the financial amounts owed to them) and the certificat de travail (a work certificate that details the employee’s professional experience and other key employment information).
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