Newsletter No. 99 – March 2017

In a decision of 15 March 2017, the French Supreme Court (Cour de cassation) judged a matter unprecedented in case law: the dismissal of a foreign pregnant employee, whose work authorization has not been renewed.  This matter involves a confrontation between two imperative rules: the reinforced protection of maternity and the prohibition to hire a foreigner who does not have an authorization to carry out his activity in France.  The Cour de cassation rules that “the employer may not, directly or indirectly, keep at his service or hire for whatever duration a foreigner who does not have an authorization to carry out his activity in France” and deduces that “an employee in such a situation may not benefit from the legal provisions protecting pregnant women which prohibit or limit the cases for dismissal” (Cass. Soc., 15 March 2017, No. 15-27.928).

The Cour de cassation confirms its restrictive case law regarding co-employment situations.  In a decision of 7 March 2017, it ruled that the following did not suffice to characterize a situation of co-employment:

– the close collaboration of the subsidiary’s managers, coming from the group, with the dominant company;

– the important financial support provided by the dominant company to the group in comparison to the reimbursement ability of the subsidiary;

– the signing of a cash agreement and of a general insurance agreement covering all the company’s business lines for the functioning of the subsidiary, subject to remuneration (Cass. Soc., 7 March 2017, No. 15-16.865).

The European Court of Justice of the European Union has finally ruled on the delicate question expressed by France and Belgium in 2015, of whether it was possible to impose restrictions on the wearing of religious symbols within a company.  By a decision of 14 March 2017, the CJEU restricts the possibility for companies to include a neutrality clause in their rules and regulations.  Based on the requirements set by the Council’s directive 2000 / 78 / CE dated 27 November 2000 on equal treatment in employment and occupation, it judges that a clause prohibiting or restricting the wearing of any symbol of political, religious or philosophical affiliation at work shall be justified by a legitimate objective (such as the pursuit, in the relations with the customers, of a philosophical or religious neutrality policy), as far as the means are appropriate and necessary, which the national judge shall ensure.  However, in the absence of any precisions in the rules and regulations, the CJEU considers that the wish of a customer to no longer see services being provided by an employee wearing a symbol of religious affiliation, may not constitute an essential and determining professional requirement, but would amount to discrimination  (CJUE, Gde Chbre, 14 March 2017, cases C-157-15 and C-188/15).

Article R.1234-9 of the Labor code imposes the delivery of the end of contract documents by the employer “at the time of the expiration or termination of the employment contract”.  In a decision dated 15 March 2017, the Cour de cassation overturns and annuls the decision of a Court of appeal that had ruled that “the delivery of a pôle emploi attestation was not mandatory, the employee not being entitled to claim the payment of unemployment benefits due to his dismissal”.  It thus judges that the obligation for the employer to deliver an unemployment insurance attestation to the employee applies to all cases of employment contract termination, including in case of dismissal (Cass. Soc., 15 March 2017, No. 15-21.232).

In a decision rendered on 8 March 2017, the Cour de cassation validates the dismissal of a human resources manager, who had not taken the measures allowing to put an end to the dubious and abusive management methods of a store manager.  It indeed judges that “the employee, who worked in very close cooperation with the store manager, knew about the latter’s unacceptable behavior with respect to his subordinates and could in addition take part in it, that she did nothing to put an end to this practice yet in her capacity as human resources manager, she had a particular duty in terms of management, that it was part of her duties to attend to the social climate and ensure “optimal” working conditions for the workers”.  It concludes finally that “the employee had failed to fulfil her contractual obligations and had endangered both the physical and mental health of the employees” (Cass. Soc., 8 March 2017, No. 15-24.406).

The regulatory framework of the managers’ remuneration instituted by the Sapin II law came into force.  Indeed, since 18 March 2017, the general shareholders’ meeting of listed LLCs must approve the managers’ remuneration, and not only give a simple advisory opinion in this respect.  This law thus concerns the presidents, managing directors and deputy managing directors of LLCs with a board of directors, but also the management board members, the managing director and the supervisory board members of LLCs with a supervisory board (D. No. 2017-340 of 16 March 2017, JO 17 March).

The law dated 27 March 2017, relating to the duty of care of parent companies and ordering companies, created article L. 225-102-4 of the Commercial code, that provides that any company, which hires, on the closing of two consecutive financial years, at least 5,000 employees within it and in its direct and indirect subsidiaries, the registered office of which is set in France, or at least 10,000 employees if the registered office is located in France or abroad, must establish a duty of care plan, in order to identify the risks and prevent any serious infringements of human rights, fundamental freedoms, the health and safety of persons.  The French Constitutional Council (Conseil Constitutionnel) removed from the published law the provisions providing for the possibility to impose a fine on recalcitrant companies (CC, decision No. 2017-750 DC, 23 March 2017; L. No. 2017-399 of 27 March 2017, JO 28 March).