Indemnities with the industrial tribunals: the Court of Cassation gives reason to the executive

Victory for the government: the Court of Cassation estimated, Wednesday, July 17, that the cap on compensation for unfair dismissal, a flagship measure of work orders challenged by several industrial tribunals, was "compatible" with international texts.

The highest court of the judiciary was seized for opinion by two boards of labor courts, after the refusal of several others to apply the scale of compensation, decried by the unions and welcomed by the employers.

In its opinion, the Court considers that this scale is "compatible with Article 10 of Convention No. 158 of the International Labor Organization" (ILO), which requires "the payment of adequate compensation" in the event of unfair dismissal.

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For the Court, "the term 'adequate' should be understood as reserving to States Parties a margin of appreciation".

The Court also considers that the European Social Charter, another text invoked, "has no direct effect in domestic law in a dispute between individuals" and that the scale "does not fall within the scope of application of the Article 6 of the European Convention on Human Rights "on the right to a fair trial.

Nearly twenty industrial tribunals refused to apply the scale

Since the ordinances reforming the Labor Code at the end of 2017, these damages and interests are capped between one and twenty months of gross salary, according to the seniority. For example, this ceiling is ten months for ten years of seniority.

From two years of seniority applies a minimum floor of three months which may be lower in companies with less than eleven employees. Previously, this threshold was six months and judges were not bound by a cap. In fact, they went up to 30 months salary for 30 years of seniority.

The scale is not applied in case of dismissal (moral or sexual harassment, discrimination, etc.).

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Despite its validation by the Constitutional Council in March 2018, several industrial tribunals (nearly twenty according to a syndicate of lawyers, including Troyes, Amiens, Grenoble and Lyon) have, for several months, refused to apply the scale on the ground that it would be contrary to France's international commitments.

To see more clearly, the councils of Louviers, in Eure, and Toulouse had thus seized the Court of Cassation to have an opinion in general, without waiting an appeal on this question, on a concrete case.

This opinion should strongly influence future judgments, including the first two decisions of courts of appeal, expected September 25, one in Paris, the other in Reims.

"It will be very difficult for a court of appeal to ignore such an opinion"

"This collegial opinion of the Court will have a very high moral authority.It will be very difficult for a court of appeal to ignore such an opinion," recognizes Antoine Lyon-Caen, speaking on behalf of the CFE-CGC, which does not, however, despair that in the future the Court of Cassation will pronounce differently "on a particular case of application of the scale".

Labor Minister Muriel Pénicaud had defended the implementation of such a scale as to remove the uncertainty for the employer of the cost of a potential break, which she said was "a brake on hiring" in CDI.

Conversely, the unions denounced a scale that "secures the faulty employer" with a ceiling too low, especially for employees with little seniority. The CGT denounced Wednesday in a statement "an aberrant validation of the Macron scales by the Court of Cassation".

The continuous decline in the number of labor disputes over the past 20 years is expected to continue, as a result of this opinion. According to a Senate report released Tuesday, the number of disputes has decreased by 45% since 2005, as a result of "the decline in the number of dismissals and the increasing recourse to conventional rupture".

However, average trial time "in the first instance" have not decreased "and exceed 16 months or more than 30 when a judge must intervene. In addition, two-thirds of judgments are appealed.

According to this report, the fault lies in the fact that only the most complex cases are left to the labor tribunals, but also to a lack of professionalism by the labor councilors, who are jointly appointed by the trade union and employers' organizations.

With AFP