Three rulings handed down on 3rd March 2015 for the first time specify the position of the Cour de cassation regarding contractual termination prior to or following dismissal. These rulings demonstrate the Court’s intention of restricting possibilities of the employee disputing the termination.
Mutual severance agreement subsequent to dismissal amounts to withdrawal of the dismissal (Cass. soc., 3 March 2015, n°13-20549)
On 9th January 2009, an employee was dismissed for misconduct, the notice period being waived.
On 10th February 2009, the mutual severance agreement was agreed. It was approved in March.
No express agreement was made on withdrawal of the dismissal. However, the Cour de cassation considers that a mutual severance agreement agreed subsequent to dismissal is valid and leads to withdrawal of the dismissal.
This is a surprising attitude. Indeed, in the past the Court considered that dismissal could not be withdrawn by the employer so long as the employee had not clearly and unequivocally given consent (See, in this regard: Cass. soc., 12 May 1998, n°95-44.354). Considering that signature of a mutual severance agreement is adequate is not self-evident.
To be followed…
Mutual severance agreement does not automatically involve waiver by the employer of the initially initiated disciplinary procedure (Cass. soc., 3 March 2015, n°13-15.551)
An employee insulted a supplier on 21 May 2010. The employer summoned the employee to a preliminary interview preparatory to possible dismissal, which was arranged for 7th June.
On the day of the interview, mutual severance agreement was agreed.
On 16th June 2010, the employee exercised the right to withdraw, and on 21 June, the employer once again summoned the employee for interview.
On 1st July 2010, dismissal was notified to the employee.
The employee disputed the regularity of his dismissal, claiming that the employer, by taking the route of mutual severance agreement process, had waived the right to exercise its disciplinary authority.
The Cour de cassation did not accept the employee’s argument and indeed specified:
- that a new preliminary interview should be arranged, and
- that the 2 month limitation period must be respected (C. trav., art. L. 1332-4).
Negotiation and conclusion of a mutual severance agreement does not therefore automatically lead to waiver of the employer’s exercise of its disciplinary authority.
Care should, nonetheless, be taken with regard to the possibility of conclusion of a mutual severance agreement on the same day as the preliminary interview. Indeed, in this case, the validity of the contractual termination was not disputed by the employee, because the employee had withdrawn.
Mutual severance agreement does not automatically involve suspension of the limitation period (Cass. soc., 3rd March 2015, n°13-23348)
Following many unjustified absences, the employee and the employer agreed a mutual severance agreement.
The employee withdraws. The employer thus undertakes disciplinary proceedings, although more than two months had passed between discovery of the wrongful acts and the summons. Dismissal was therefore stated to be without genuine and serious cause.
By this ruling the Cour de cassation clearly confirmed that agreement of a mutual severance agreement has no suspensive effect on the two month limitation period set by L.1332-4 of the Labour Code.
Conclusion: In order to avoid any difficulty, negotiation of a mutual severance agreement may be envisaged in the following two scenarii:
- negotiation of a mutual severance agreement prior to the procedure for dismissal being opened: the negotiation must be carried out within a short period of time in order to be able to organise the period for withdrawal and the limitation period;
- undertaking the dismissal procedure whilst also offering a mutual severance agreement Take care in this case, however, with regard to lack of consent due to the dismissal procedure.