The company Viveo France submitted a restructuring project entailing the loss of 64 jobs and a social plan to its works council. After considering the expert report, the works council brought the case to the High Court in expedited proceedings in order that it might rule that no economic cause justified the initiation of layoff proceedings and to have these invalidated.
The Paris Court of Appeal considered that the works council was entitled to request invalidation of the proceedings and all its subsequent effects, since the lack of economic grounds made the consultation of the works council redundant and rendered the entire subsequent proceedings ineffective.
The Court of Appeal justified its position on the basis that a consultation on a project claiming the existence of an economic reason whereas in fact there was none could not constitute a consultation as intended by the legislators, who would have had to be ignorant of the most basic logic if they intended that layoff proceeding should be invalidated if there was no redeployment plan and yet would not be invalidated if the actual basis of this plan and the trigger for the whole process were non-existent.
The French Supreme Court criticised the position taken by the judges on the merits.
First of all, in a statement of principle which has attracted a lot of attention it stated that “pursuant to [article L.1235-10 of the Labor Code], only the absence or inadequacy of a social plan submitted to the staff representatives leads to the invalidity of the layoff proceedings for economic reasons”. In the present case, it concluded from this that the layoff proceedings could not be invalidated by reference to economic grounds for said layoff, since the validity of the plan was independent of the cause of the layoffs (Supreme Court, Social Affairs Division, 3 May 2012, No. 11-20741).