Friday, December 21, 2012

France - Less Working Hours Shall Not Mean Increased Pressure

By Judith Beckhard Cardoso and Noemie Birnbaum

In 2000, legal working time in France went from 39 hours a week to 35 hours. Since then, the computation of the employees' working time has been dependant upon each employee's position. Senior officers whose working hours cannot be controlled or pre-determined in advance may enter into an agreement with their employer providing that their compensation shall be disconnected from their actual working time but shall constitute a consideration for a flat number of days worked along the year, and up to 218 days. Such agreements are called "forfaits-jours", i.e., "lump sum (consideration) (for a working time computed) in days".

To enter into force, such lump sum in days agreements must be permitted by an industry-wide or collective company agreement, negotiated by the employers' and the employees' unions from time to time and extended to all companies within a specific professional and/or geographical scope by the Labor ministry. These union agreements must also provide the terms and conditions for implementing individual lump sum in days agreements. 

Setting a trend of precedents, the French civil Supreme Court (Cour de Cassation) ruled on September 26th, 2012 that a lump sum in days agreement is not valid if no union agreement allows for sufficient protection of the employee's health and safety. 

In this case, a management level employee, whose employment contract was governed by the collective bargaining agreement for Wholesale Trade, benefited from a lump sum in days agreement. Upon being retired by the company, the employee sued his employer before the French labor courts claiming payment of damages for unfair computation of overtime hours[1]. He was able to demonstrate that his actual working hours were from 7:15am to 8pm, and included some week-ends and bank holidays due to a staff shortage. His argument was that the lump sum in days agreement did not warrant sufficient protection of his health and safety.

Whilst the facts of the matter do not raise much interest per se, the merits of the case stemming from the health and safety obligations resting on French employers is however interesting for two reasons: it was based both on the French Supreme Court's rationale in a recent similar case, and used the legal trend increasing employers' obligations in connection with health and safety issues.

Indeed, in a precedent dated June 29th, 2011, the Supreme Court, while reviewing a similar lump sum agreement governed by the collective bargaining agreement for the Metallurgical Industries, provided for a test to assess whether such lump sum agreement complied with legal requirements. According to this test, the computation of working time in days should only be deemed legal if the union agreement allowing for the lump sum in days also enabled a monitoring of both working hours and the employee's workload along with sufficient resting periods.
Failure to comply with such ruling may result in severe financial consequences for the company. By cancelling the lump sum agreement, the court ruled that the company had to pay any overtime hours claimed by the employee, with the burden of demonstrating that the employee did not actually work such overtime resting on the employer. 
From a practical standpoint, the working time agreement for the Wholesale Trade industry did not enable a control of the employee's daily workload nor did it provide for a breakdown of the workload per day. Indeed, it only verified the number of working days and allowed for an annual assessment of the employee's workload by the employer. The Supreme Court deemed this insufficient as working conditions may vary from one year to the next. Thus, such provisions were not sufficient to effectively protect the employee's health and safety.
Despite the addition of a company collective agreement which provided for a quarterly meeting during which the employee's supervisors were supposed to examine the practical implications of the lump sum in days agreement, the Supreme Court ruled that the combination of both agreements was not sufficient to guarantee a reasonable burden and dispatch of work for the employee concerned.
A second similar ruling had been issued by the Supreme Court on September 19th, 2012 for another lump sum agreement governed by the national collective bargaining agreement for the Clothing Industry. The Court specifically stated that a company collective agreement should include provisions protecting the employee's rights to health and safety guaranteed by the constitution and EU regulations.
The Supreme Court is thus clearly setting a trend one collective bargaining agreement at a time. Companies should therefore remain vigilant and start implementing mechanisms enabling an effective control of the working hours but also of the workload of their employees, without waiting for a new precedent.

[1] Statute of limitation for overtime claims is 5 years.