The so-called “Macron scales” were meant to offer companies with some degree of foreseability in case of wrongful dismissal – scaled indemnifications thus became applicable, depending on employees’ seniority.
This reform continues to be heavily challenged in Court and despite some strong decisions that upheld it, recent judgments have ruled the scales out, considering these illegal.
One of President Macron’s major reforms, the implementation of indemnification scales for employees’ dismissal, is at the heart of lively ongoing debates.
With this reform, dismissals notified after the 24th of Sept. 2017 fall under a more favorable regime for the employers.
Indeed, under the new regime, scales of indemnification are provided for in article L. 1235-3 of the French Employment code and now set up maximum limits to Court-awarded damages in case of wrongful dismissals. Although some ancillary amounts might possibly also be allocated to employees (e.g. vexatious dismissal, proceedings’ costs), the indemnification granted to employees now solely depends on employees’ seniority. Practically, this allows companies to calculate in advance the damages they would face in Court.
This reform came as employment Courts were sometimes criticised by companies who blamed the unpredictability of certain decisions, and, in some cases, the excessive protection and indemnification granted to the employees.
The scales are applicable to all dismissals except in exceptional circumstances were Courts recover their power to freely appreciate the loss incurred by the employee (among which : infringement by the employer of employee’s fundamental freedom, sexual or moral harassment, discriminatory dismissal, violation of specific protection granted to some employees such as pregnant women, elected union representatives).
First, two main French courts, the Conseil d’Etat (7th of Dec. 2017, No. 415243) and the Conseil Constitutionnel (21st of March, 2018, No. 2018-761 DC) uphelded the scales, despite unanimous criticism from both the Unions and the opposition political parties.
More recently, lower Courts started to equally uphold the reform (CPH Mans 26th of Sept. 2018). However, other lower Employment Courts held that the scales were contrary to international treaties (esp. European Social Charter and ILO conventions) and thus illegal (esp. CPH Troyes & Amiens, Dec. 2018 ; Lyon, Jan. 2019). In these latter Courts’ view, the scales could neither be deterrent nor allow an appropriate indemnification of the losses suffered by the employees.
Until the French Civil Supreme Court (Cour de Cassation) and the European courts (E.C.J. and possibly E.C.H.R.) provide definitive case-law, litigation is expected to flourish.