Common-consent termination agreements are contracts that are, as such, subject to the general rules on the validity of contracts, in particular the free consent of the contracting parties, as reiterated by the Supreme Court in its rulings on January 30, 2013 (no. 11-22.332) and February 6, 2013 (no. 11-27.000).
In the first case, the Court had considered that the state of moral harassment in which the employee found herself at the time of signing the common-consent termination agreement constituted a form of moral violence that warranted the invalidation of the signature with the result that the termination produced the effects of a dismissal without real and serious cause. It would be just as risky to enter into a common-consent agreement with an employee on sick leave, or facing the threat of disciplinary measures or dismissal, or with whom a dispute exists, as these situations are liable to be viewed as vitiating consent.
In the second case, the Supreme Court required, on penalty of the same sanction, that a copy of the common-consent termination agreement (which can simply consist in an administrative form) be provided to the employee so as to allow the latter to exercise his or her right of retraction on a fully informed basis and take the initiative of seeking approval of the agreement. In practice, the documents should be drawn up in three copies: one for the employment administration and one for each of the signatories.
It is thus up to employers to take the necessary precautions before opting for this type of termination, particularly as the issue of the employee’s lack of free consent is being raised increasingly frequently, not upstream before the employment administration, but downstream before the courts, where the sanctions imposed are rife with consequences. Now that the social (tax) treatment of the specific indemnity payment has become less favorable, it may be feared that the common-consent termination system, a victim of its own success, may be increasingly neglected in favor of negotiated dismissals – when the very purpose of the common-consent termination system had been precisely to avoid such arrangements.