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Termination in a company in difficulty: what are the rules?
Verified 10 octobre 2019 - Directorate for Legal and Administrative Information (Prime Minister)
When a company is in difficulty, it can be the subject of collective proceedings (safeguard, reorganization 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 redundancy vary according to the situation of the company.
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Backup Procedure
During the backup, the employer and the judicial administrator shall propose a safeguard plan.
The plan may provide for the dismissal on economic grounds of one or more employees of the undertaking. The conditions for the validity of each redundancy vary depending on whether the safeguard plan provides for a cessation of professional activity or not.
Every economic redundancy shall be subject to usual dismissal procedure..
Consultation and information
The Social and Economic Committee must be consulted on the restructuring plan and on the planned redundancies. The information communicated to the ESC shall also be forwarded to the Direct..
In the absence of a CSE or representation of employees in the undertaking, an employee representative shall be appointed. It has the status of protected employee..
Convocation of a prior interview
The employer shall convene each employee concerned one prior maintenance dismissal.
The employer is required to offer each employee a professional security agreement (CSP)..
In case of job safeguard plan (PSE), the employer is not required to call the employee for a pre-termination interview.
Notification of termination
General case
The notification the dismissal to the employee is carried out 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 redundancy safeguard plan).
The employee is entitled to a notice and severance pay contract.
Protected employee
The protected employee benefits from administrative authorization procedure in the event of dismissal. The notification the dismissal to the employee is carried out by registered letter with acknowledgement of receipt, after authorization of the Direct.. The letter must state the reason for the dismissal (referring to the redundancy safeguard plan).
The employee is entitled to a notice and severance pay contract.
Judicial redress
The judicial remedy provides, as a first step, for an observation period. 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 termination vary depending on whether the company is in compliance or whether a court-ordered plan for the remedy is in place.
Consultation and information
The Social and Economic Committee must be consulted on the restructuring plan and on the planned redundancies. The information communicated to the ESC shall also be forwarded to the Direct..
In the absence of a CSE or representation of employees in the undertaking, an employee representative shall be appointed. It has the status of protected employee..
Judicial authorization
Any employee may be dismissed for economic reasons after judicial authorization. Any dismissal envisaged during the observation period must be justified by its urgency, inevitability and necessity.
Convocation of a prior interview
The employer shall call each employee concerned to a meeting prior to dismissal. The employer is required to offer each employee a professional security agreement (CSP)..
In the case of an employment protection plan (PES), the employer is not required to call the employee for a pre-termination interview.
Notification of termination
General case
The notification the dismissal to the employee is carried out 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 initiated the judicial remedy).
The employee is entitled to a notice and severance pay contract.
Protected employee
The protected employee benefits from administrative authorization procedure in the event of dismissal. The notification the dismissal to the employee is carried out by registered letter with acknowledgement of receipt, after authorization of the Direct.. The letter must state the reason for the dismissal (referring to the judgment that initiated the judicial remedy).
The employee is entitled to a notice and severance pay contract.
Consultation and information
The Social and Economic Committee must be consulted on the restructuring plan and on the planned redundancies. The information communicated to the ESC shall also be forwarded to the Direct..
In the absence of a CSE or representation of employees in the undertaking, an employee representative shall be appointed. It has the status of protected employee..
Convocation of a prior interview
The employer shall call each employee concerned for a pre-termination interview.The employer shall propose to each employee a professional security agreement (CSP)..
In the case of an employment protection plan (PES), the employer is not required to call the employee for a pre-termination interview.
Notification of termination
General case
The notification redundancies to employees shall be made 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 setting out the corrective action plan).
The employee is entitled to a notice and severance pay contract.
Protected employee
The protected employee benefits from administrative authorization procedure in the event of dismissal. The notification the dismissal to the employee is carried out by registered letter with acknowledgement of receipt, after authorization of the Direct.. The letter must state the reason for the dismissal (referring to the judgment setting out the corrective action plan).
The employee is entitled to a notice and severance pay contract.
Judicial liquidation
The liquidation ends the business. Consequently, the appointed liquidator is authorized to make redundancies.
The Social and Economic Committee must be consulted on the restructuring plan and on the planned redundancies. The information communicated to the ESC shall also be forwarded to the Direct..
In the absence of a CSE or representation of employees in the undertaking, an employee representative shall be appointed. It has the status of protected employee..
The employer shall call each employee concerned for a pre-termination interview.The employer shall propose to each employee a professional security agreement (CSP)..
In the case of an employment protection plan (PES), the employer is not required to call the employee for a pre-termination interview.
General case
The notification the dismissal to the employee is carried out 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 contract.
Protected employee
The protected employee benefits from administrative authorization procedure in the event of dismissal. The notification the dismissal to the employee is carried out by registered letter with acknowledgement of receipt, after authorization of the Direct.. The letter must state the reason for the dismissal (referring to the liquidation judgment).
The employee is entitled to a notice and severance pay contract.