In a decision dated 16 September 2015 (Cass. Soc., 16 Sept. 2015, n°13-28.415), the French Cour de cassation decided that the principle of equality of treatment is not applicable between employees from different companies, even if they belong to the same group. Employees cannot therefore compare their situation with those of other employees belonging to another group company when seeking to gain the same advantages.

According to French case law, the principle of equality of treatment applies between employees within the same company.

In this case, some of the companies within a corporate group applied a supplementary retirement benefit. In order to standardise the different schemes, an intra-group agreement was created in 1990 and a pension institution was formed which enabled companies to freely join and collate such benefits. For employees to benefit from this scheme, they needed to be employed by one of the companies who were a member of this institution as at December 31 1989.

In 2009, a retiring employee was denied the right to receive these benefits because, on December 31 1989, his employer was not a member of the institution.

He argued that this was a violation of the principle of equality of treatment and compared himself to other employees of the group, working for companies which were members of the institution and benefiting from the supplementary retirement benefit.

The French Cour de Cassation rejected his argument and considered that the principle of equality of treatment is not applicable between employees from different companies, even if they belong to the same group.

This decision is in line with recent case law confirming that employees belonging to companies within the same group are not entitiled to claim the application of the principle equal pay for equal work (Cass. Soc., 9 oct. 2013, n°12-16.664).

The employee’s right to prior notice in the event of the sale of their company

The Hamon law dated 31 July 2014 created a pre-sale procedure for informing employees in companies with less than 250 employees in circumstances where there is a contemplated sale of the business or of the majority of shares. However, many problems have been created by this law, which has led to recent modifications (the Macron law):

  • the prior informing of the employees is now mandatory only in cases involving a sale;
  • the sanction for violation of the prior information obligation is a civil fine capped at 2% of the sale amount (the former sanction was the nullity of the sale, which was highly criticized and considered disproportionate); and
  • employees can be informed by any means and notably by an information note on company’s notice boards or an information meeting (with signatures of the employees on a document in order to confirm the acknowledgment of the information) or a letter with acknowledgment of receipt (in such case, the date of first presentation of the letter to the employee by the French post is considered as the date of information).

The main criticism of the Hamon law concerned the sanction of the violation which was considered as a disproportionate interference to the entrepreneurial freedom by the French Constitutional Council (Conseil Constitutionnel) and was cancelled on July 17 2015, leading to the above-mentioned modifications by the Macron law.