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Dismissal in a company in difficulty: what are the rules?
Verified 13 April 2021 - Directorate for Legal and Administrative Information (Prime Minister)
Where a company is in difficulty, it may be the subject of collective proceedings (safeguard, judicial redress or liquidation). This procedure may justify the dismissal of one or more employees on economic grounds. If this is the case, the conditions of validity of each dismissal vary according to the company's situation.
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Backup Procedure
During the investigation procedure backup, the employer and the court administrator shall propose a safeguard plan.
The plan may provide for the dismissal for economic reasons of one or more employees of the company. The conditions for the validity of each dismissal vary according to whether the safeguard plan provides for the cessation of the professional activity or not.
Every economic dismissal shall be subject to the normal dismissal procedure.
Consultation and information
The Social and Economic Committee (ESC) must be consulted on the proposed restructuring and on the planned redundancies.
The information communicated to the ESC shall also be forwarded to the Dreets: titleContent.
In the absence of an SSC or employee representation in the company, an employee representative shall be appointed. It has the status of protected employee.
Invitation to a pre-interview
The employer calls each employee concerned to one pre-maintenance to dismissal.
The employer must offer each employee a professional security contract (CSP).
Warning
in case of employment protection plan (ESP), the employer is not obliged to summon the employee for an interview prior to dismissal.
Notification of dismissal
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General case
The notification from dismissal to the employee is made by registered letter with acknowledgement of receipt, at least 2 days after the date of the preliminary interview.
The letter should specify the reason for the dismissal (referring to the safeguard plan for the dismissals).
The employee is entitled to a notice and severance pay of contract.
Protected employee
The protected employee shall benefit from the administrative authorization procedure provided for in the event of dismissal.
The notification of dismissal to the employee is made by registered letter with acknowledgement of receipt, after authorization of the Dreets: titleContent.
The letter should specify the reason for the dismissal (referring to the safeguard plan for the dismissals).
The employee is entitled to a notice and severance pay of contract.
Judicial Redress
The judicial redress provides for a period of observation as a first step.
At the end of this observation period, a recovery plan shall be drawn up by the commercial court.
Economic redundancies can be pronounced during these 2 stages.
The conditions for dismissal vary depending on whether the company is under observation or whether a reorganization plan is drawn up by the court.
Consultation and information
The Social and Economic Committee (ESC) must be consulted on the proposed restructuring and on the planned redundancies.
The information communicated to the ESC shall also be forwarded to the Dreets: titleContent.
In the absence of an SSC or employee representation in the company, an employee representative shall be appointed. It has the status of protected employee.
Judicial authorization
Any employee may be dismissed on economic grounds after judicial authorization.
Any dismissal envisaged during the observation period must be justified by its urgent, unavoidable and indispensable nature.
Invitation to a pre-interview
The employer shall invite each employee concerned to an interview prior to dismissal.
The employer must offer each employee a professional security contract (CSP).
Warning
in the case of an employment protection plan (ESP), the employer is not obliged to summon the employee for an interview prior to dismissal.
Notification of dismissal
Répondez aux questions successives et les réponses s’afficheront automatiquement
General case
The notification from dismissal to the employee is made by registered letter with acknowledgement of receipt, at least 2 days after the date of the preliminary interview.
The letter must state the reason for the dismissal (referring to the judgment that led to the judicial redress proceedings).
The employee is entitled to a notice and severance pay of contract.
Protected employee
The protected employee shall benefit from the administrative authorization procedure provided for in the event of dismissal.
The notification of dismissal to the employee is made by registered letter with acknowledgement of receipt, after authorization of the Dreets: titleContent.
The letter must state the reason for the dismissal (referring to the judgment that led to the judicial redress proceedings).
The employee is entitled to a notice and severance pay of contract.
Consultation and information
The Social and Economic Committee (ESC) must be consulted on the proposed restructuring and on the planned redundancies.
The information communicated to the ESC shall also be forwarded to the Dreets: titleContent.
In the absence of an SSC or employee representation in the company, an employee representative shall be appointed. It has the status of protected employee.
Invitation to a pre-interview
The employer shall invite each employee concerned to an interview prior to dismissal.
The employer must offer each employee a professional security contract (CSP).
Warning
in the case of an employment protection plan (ESP), the employer is not obliged to summon the employee for an interview prior to dismissal.
Notification of dismissal
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General case
The notification dismissals of employees shall be effected by registered letter with acknowledgement of receipt, within one month of the pronouncement of the judgment.
The letter must state the reason for the dismissal (referring to the judgment establishing the recovery plan).
The employee is entitled to a notice and severance pay of contract.
Protected employee
The protected employee shall benefit from the administrative authorization procedure provided for in the event of dismissal.
The notification of dismissal to the employee is made by registered letter with acknowledgement of receipt, after authorization of the Dreets: titleContent.
The letter must state the reason for the dismissal (referring to the judgment establishing the recovery plan).
The employee is entitled to a notice and severance pay of contract.
Judicial winding-up
The judicial liquidation terminates the company's activity. Consequently, the liquidator appointed is authorized to dismiss employees.
The Social and Economic Committee (ESC) must be consulted on the proposed restructuring and on the planned redundancies.
The information communicated to the ESC shall also be forwarded to the Dreets: titleContent.
In the absence of an SSC or employee representation in the company, an employee representative shall be appointed. It has the status of protected employee.
The employer shall invite each employee concerned to an interview prior to dismissal.
The employer must offer each employee a professional security contract (CSP).
Warning
in the case of an employment protection plan (ESP), the employer is not obliged to summon the employee for an interview prior to dismissal.
Répondez aux questions successives et les réponses s’afficheront automatiquement
General case
The notification from dismissal to the employee is made by registered letter with acknowledgement of receipt, at least 2 days after the date of the preliminary interview.
The letter must state the reason for the dismissal (referring to the liquidation judgment).
The employee is entitled to a notice and severance pay of contract.
Protected employee
The protected employee shall benefit from the administrative authorization procedure provided for in the event of dismissal. The notification of dismissal to the employee is made by registered letter with acknowledgement of receipt, after authorization of the Dreets: titleContent. The letter must state the reason for the dismissal (referring to the liquidation judgment).
The employee is entitled to a notice and severance pay of contract.
- Labor Code: Articles L1233-58 to L1233-60-1Dismissal on economic grounds in the context of a legal safeguard, redress or liquidation
- Commercial Code: Articles L631-1 to L631-22Course of judicial redress