France's Employment Reforms To Go Into Effect In September

Author:Ms Karine Audouze
Profession:Ogletree, Deakins, Nash, Smoak & Stewart
 
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As President Emmanuel Macron had promised, major employment reforms are under way in France and the related ordinances have been published on August 31, 2017, after extensive negotiations with national unions, concerning, in particular, the following issues:

Capping Damages Awarded by Employment Tribunals in Unfair Dismissal Cases

Damages will now be capped at three months' salary for employees with two years of seniority (employees with fewer than two years of seniority will be entitled to an award equal to one month's salary). Damages will be capped at 20 months' salary for employees with more than 30 years' seniority. Before this ordinance went into effect, the amount of damages awarded in unfair dismissal cases was left to the discretion of the employment tribunals and was not capped, leading to extensive uncertainty for employers. These damages caps will not apply in discrimination-related cases.

Mandatory Dismissal Indemnities

The reforms increase mandatory dismissal indemnities to 0.25 of one month's salary for every year of the employee's seniority.

Negotiating Collective Agreements

Small companies with less than 20 employees will be able to negotiate collective agreements with an employee who is neither a union member nor an elected worker's representative. These companies will also be able to negotiate agreements via a referendum with all employees on all subjects. Companies with 20 to 50 employees may collectively negotiate with an elected employee...

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