The French Parliament has definitively adopted the law on the protection of employment (“loi sur la sécurisation de l’emploi), essentially by transposing the eponymous national inter-professional collective bargaining agreement signed between French employer organisations and national trade unions on 11 January 2013. The law was passed on June 16th, 2013, after its validation by the Conseil constitutionnel (Constitutional Court).

As its name indicates, the main objective of this law is to protect jobs while introducing some flexibility for companies.

One of its key measures is the possibility for companies facing serious cyclical economic difficulties to enter into an agreement that temporarily (for a maximum period of two years) allows them to change the working hours and wages of employees, in return for a commitment not to carry out any redundancies during the term of the agreement, such commitment being secured by a penalty clause. Individual agreement by the employees is required and any employees opting out of the agreement can be dismissed, if applicable, on economic grounds.

Partial unemployment, renamed “partial activity”, has been simplified by merging the previous schemes (specific benefit, additional contractual benefit, APLD (long-term partial activity) agreement).

The procedure for “large redundancies” on economic grounds (at least 10 employees over a period of 30 days in companies having at least 50 employees) has also been overhauled:

  • Henceforth, the content of the redundancy plan, called plan de sauvegarde de l’emploi (PSE) and the conditions of consultation of the Works Council (WC) will be set, either pursuant to an agreement with the trade unions (“accord collectif majoritaire”), or by a document unilaterally drawn up by the employer;
  • The WC will have to hold at least two meetings at a minimum interval of 15 days on the proposed plan. It will be required to issue an opinion on the plan as well as on the contemplated reorganisation within a maximum period of two to four months depending on the scale of the downsizing. The WC can authorise the employer to propose in-placement measures even before the consultation process. The duties of the WC’s accountant are regulated;
  • The administrative authority is tasked either with validating the agreement entered into with the trade unions, or approving the unilateral document – its oversight being stepped up in this last case. Disputes in connection with the PSE and with the consultation process of the WC are now within the remit of the administrative courts and grouped at the end of the proceedings. However, the labour tribunal retains its jurisdiction to assess the validity of the economic rationale.

The law also provides for flat indemnity payments aimed at encouraging mediation via the labour tribunal. The statute of limitations for bringing claims in connection with the performance and termination of employment contracts on the one hand and for the payment of wages on the other have been respectively brought down to two and three years.

The law introduces quite a few additional new measures, which significantly modify employment law: creation of a period of voluntary secure mobility, creation of a personal job training account (transferrable), new negotiation or consultation topics (for example, on the company’s strategic orientations), limitation in time of the WC consultation process, creation of an economic and social database accessible to staff representatives, requirement to seek out a buyer before closing a site, maximum leave to find employment (congé de reclassement) of 12 months, overhaul of the rules on part-time work, etc.