A non-autonomous Executive employee may not be subject to a fixed number of working days per year (“forfait-jours”) regime.
Subject to limited exceptions, the legal duration of work for salaried employees in France is 35 hours per week, which means that any hour of work required above this limit is considered as overtime, to be compensated by additional days of rest or remuneration.
However, in practice, most Executives avoid this limit of 35 hours per week, as the French Labor Code enables certain Executives to agree to receive a lump-sum remuneration in exchange for working a fixed number of days per year (art. L. 3121-43 of the French Labor Code).
More precisely, 1.5 million Executives in France have entered into such agreements (“forfaitjours”), which means that their working time depends not on a number of working hours per week, but, rather, on a number of working days per year (i.e., in principle 218 days per year maximum, including the Solidarity Day, or a lesser number of days as provided by a company-wide agreement or the applicable national collective bargaining agreement). In return, these Executives benefit from additional days of rest per year (instead of overtime payment).
The French Civil Supreme Court, in a decision dated November 21st, 2012, recently emphasized an important principle concerning the validity of these annual fixed number of working day agreements, as follows: “Executives who are able to enter into a lump-sum remuneration agreement based on a fixed number of days (“forfait-jours”) must necessarily benefit from real autonomy both in the determination of their working hours and in the way they organize their work” (emphasis added).
1) The use of lump-sum remunerations based on days worked annually must be restricted to Executives who are truly autonomous
The French Labor Code grants employers the possibility to apply an annual fixed number of days agreement to Executives who have “real autonomy in the organization of their work schedule”, and “whose functions do not require them to follow the collective working hours”, or “whose working time cannot be determined in advance” (art. L. 3121-43, 1° et 2° of the French Labor Code).
By stressing the fact that annual fixed number of working days agreements must be restricted to salaried employees who are truly autonomous, meaning effectively free in the way they organize their work and determine their working hours, the Civil Supreme Court has narrowly construed the provisions of the Labor Code.
In conclusion, it is not possible to apply an annual fixed number of working days agreements to nonautonomous salaried employees.
2) Towards a definition of the notion of “autonomy” of the salaried Executive
The Civil Supreme Court has provided, by its decision of November 21st, 2012, a gloss to the laconic terms of Article L. 3121-43 of the Labor Code: the beginnings of a definition of the degree of autonomy required in order for an Executive to be able to enter into an annual fixed number of days agreement.
In the case considered, the Civil Supreme Court ruled on the situation of an employee with the title of experienced sales promoter, who had entered into an annual fixed number of days agreement by amendment to his contract of employment, which also granted him the status of “Executive” by reference to the professional classification provided by the company-wide agreement.
The Court affirmed the reasoning of the Court of Appeal, which refused to apply an annual fixed number of days agreement to this employee who was not truly autonomous, despite the qualification of “Executive” given to him by his employer.
- Affirmative description of the notion of autonomy
The French Civil Supreme Court ruled, affirmatively, that to benefit from an annual fixed number of days agreement, an Executive must be free to determine both his working hours and the way he organizes his work. Furthermore, this autonomy is conferred on the Executive because the duration of his work, on account of the nature of his functions and the tasks incumbent upon him, cannot be determined in advance.
- Negative description of the notion of autonomy
The French Supreme Court ruled, in the negative, that the employee in question was not autonomous since:
- “his mission had no technical, complex or versatile nature”;
- “he did not benefit from any autonomy in his functions”;
- “he did not have any team under his responsibility”;
- “and thus was not taking any initiatives in the execution of his functions”.
In other words, it is not the status of Executive which rendered the salaried employee autonomous but his true autonomy within the framework of his functions.
In consequence, in the event that a salaried employee should contest his annual fixed number of working days agreement, his employer must be able to demonstrate the true, factual autonomy of the said employee.