A dispute between the parties at the time of signing a mutual termination agreement does not impair its validity

By signing a mutual termination agreement, the employer and the employee agree on the terms under which the employment contract shall be terminated (art. L.1237-11 of the French Labour Code). In a judgment dated November 15, 2023, the French Supreme Court has answered the following question: can a mutual termination agreement be validly signed if there is a dispute between the parties at the time it is concluded?

In that matter, a construction worker had repeatedly worked without a safety harness and helmet, despite the job requiring these safety equipments. The employer had thus contemplated a potential dismissal for gross misconduct before the parties agreed to terminate the employment contract through a mutual agreement.

Subsequently, the employee challenged the validity of this mutual termination agreement before the Employment Tribunal, arguing that he had been pressured by the employer who had threatened him with a dismissal for gross misconduct. The employee claimed that he had no other choice but to sign the termination by mutual agreement, knowing that, otherwise, he would be dismissed for gross misconduct.

The employee was dismissed from his claims by the Court of Appeal and, therefore, appealed against the decision before the French Supreme Court.

The French Supreme Court rejected the employee’s arguments and confirmed the decision of the Court of Appeal:

“After having correctly reminded that the existence, at the time of the conclusion of the mutual termination agreement, of a dispute between the parties to the employment contract does not per se affect the validity of the termination agreement, the Court of Appeal observed, through its own findings, that the employee had not exercised his right of withdrawal and did not establish that the mutual termination had been imposed by the employer. Thus, the Court of Appeal judged that the employee did not bring proof of a flawed consent”.

Cass. Soc. November 15, 2023, No. 22-16.957