- What are the critical thresholds when it comes to collective redundancies?
As soon as a company contemplates the termination of more than 1 employee for economic reasons, it should comply with a specific process. The scale of the project will ultimately determine which process the company must apply:
- If the project involves at least 10 dismissals within the same 30-day period and the company has less than 50 employees, the CSE (The Social and Economic Committee, i.e. the staff representatives) must be consulted on the project. The CSE holds two meetings that cannot be more than 14 days apart. It is provided with certain documents and information (such as the economic rationale, the number of job losses, the provisional timetable, the supporting social measures…). Furthermore, the DREETS (i.e. the French Labour administration) is kept informed throughout the process.
- If the project involves at least 10 dismissals within the same 30-day period and the company’s workforce exceeds a threshold of 50 employees, the company must implement a job-protection plan to limit the number of dismissals. As detailed below, the process for implementing a job-protection plan is much more burdensome.
- Is there a specific process to implement a job-protection plan?
The job-protection plan may take several forms:
- The employer and the representative trade unions may enter into a majority company agreement which sets out the content of the job-protection plan and which is endorsed by the DREETS. In order to be valid, the agreement must be executed by one or several representative trade unions that received at least 50% of the ballots during the first round of the last CSE’s elections.
- Alternatively, if a company agreement is not signed, the employer may lay out the conditions for the collective termination of the employees in a unilateral document which is certified by the DREETS.
The employer has the choice: there is no obligation to prefer the negotiation of the agreement over the unilateral document but the negotiated option is always highly recommended. Indeed, the control carried out by the labor authorities over a company agreement is much lighter than the in-depth review it is expected to perform over a unilateral document.
- What is the framework for the consultation with the staff representatives?
The employer must provide all relevant information on the collective redundancies project as well as the job-protection plan from the beginning of the consultation with the CSE. The CSE is consulted on (i.) the restructuring project itself including the economic rationale, (ii.) the collective redundancies project (number of job losses, selection pools, provisional timetable, supporting social measures…), (iii.) the consequences of the restructuring in terms of health, security and work conditions.
The CSE holds at least two meetings that are at least 15 days apart. From the date of the first meeting, the CSE is legally supposed to give an opinion within a period of time that cannot be more than 2 months where the number of redundancies is below 100, 3 months if the number of redundancies is between 100 and below 250 and 4 months if the number of redundancies is over 250.
The opinion given by the CSE is not binding. Whether it is positive or negative, the employer may implement the projected reorganization.
The CSE may request the assistance of an expert (whose costs must be borne by the employer). The trade union representatives may also benefit from the expert’s assistance during the negotiation of the company job-protection plan agreement.
- What is the role of the labor authorities in this process?
The DREETS is informed in real time of the procedure and is legally authorized to audit at any stage. This entails sending electronically any document related to the procedure (invitations, agenda, minutes…). At any time during the procedure, the DREETS may issue (i.) observations or propositions to the employer related to the ongoing procedure and (ii.) formal requests (also called injunctions) to communicate information or to comply with a procedural requirement.
At the end of the consultation procedure, the employer files an official request with the DREETS to either certify the employer’s unilateral document within 21 days, or endorse the job-protection plan company agreement within 15 days. At the end of these periods, an absence of response is deemed to mean a certification/endorsement. The level of the DREETS’ investigation varies depending on the nature of the document (heavy control in case of a unilateral document / light control in case of company agreement).