Changes to the Social and Fiscal System of Overtime Hours

New Legislation Enacted

A new provision of the French social security code (Article L.241-17) reduces employers’ social contributions on overtime. This reduction, which was enacted by a Law on Emergency Measures in response to the “yellow vests” movement, does not apply when the payment of overtime replaces a different type of remuneration already in place. An exception applies when such replacement occurs more than twelve months after the last payment of the other type of remuneration.

Employers Responsible for Misconduct of Those Exercising Authority Over Other Employees

Precedential Decision by Judiciary or Regulatory Agency

Employers are bound by a security obligation regarding employees’ health and must ensure that no employee falls victim of discrimination. In this matter, a female employee working in a charity sued her employer and claimed damages because one of her coworkers used sexist comments against her, while others threw wasted goods at her. These events occurred in the kitchens during one of the charity’s organized events, in front of several colleagues. The Court ruled that the supervisor, in charge of the integration of employees, should have taken immediate action to protect the plaintiff. Due to the inaction, the employer was sentenced to pay.

Contractual Termination Invalidated Only by Fraud or Defect of Consent

Precedential Decision by Judiciary or Regulatory Agency

The French Supreme Court ruled that a mutual termination agreement is not necessarily cancelled because the employee has been a victim of bullying. The Court stated that only fraud or lack of consent could potentially invalidate the contractual termination of employment. Therefore, the court overruled the previous decision of a lower court that invalidated the mutual termination on the sole basis that bullying had occurred. This matter will come before a new court and the employee will have to demonstrate that his consent was not real.

Working Time Control Via a Geolocation System Is Legal If Used as Last Resort

Precedential Decision by Judiciary or Regulatory Agency

An employer set up a geolocation system to track employees’ working time via a mobile case they had to carry with them (they were delivering fliers and newspapers). A union sued the employer and asked the system to be removed, arguing that this type of geolocation is illegal. The union claimed that there were other ways to track the employee’s working time, such as a mobile timesheet, auto-declaration or hiring a supervisor. The French Supreme Court ruled that the use of a geolocation system is legal only when there are no other ways to ensure working time control, even if the system is not as efficient. The Court sided with the union, adding that using such system is not justified when employees have total freedom in their work organization.

New CSR Polices in Upcoming “Growth and Business Transformation” Bill

Proposed Bill or Initiative

The “Growth and Business Transformation” bill is reinforcing corporate social responsibility within limited companies. Unlisted companies employing at least 1,000 people in France or 5,000 people worldwide will be required to appoint to their board one or several directors representing employed shareholders. This obligation will be extended to listed holdings exercising strategic influence. The directors representing employees (shareholders or not) will be provided a reinforced training. Starting January 1, 2020, limited companies, as well as companies and partnerships partly limited by shares, that violate equal representation within executive boards will be sanctioned by cancelling every decision in which the director would have participated. Finally, corporate governance reports presented to the board of directors must provide information regarding pay gaps between senior executives and employees.