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The cap on industrial tribunal compensation again questioned in court

The Court of Cassation is preparing to arbitrate a long dispute sparked by Emmanuel Macron. Thursday, March 31, it must consider four disputes relating to one of the emblematic reforms carried out by the Head of State at the start of his five-year term: the cap on damages awarded by the courts to an employee victim of a dismissal “without real and serious cause”. Since its adoption in September 2017 as part of the ordinances that rewrote the labor code, this measure has been opposed because it would contravene France’s international commitments. One of the main issues of Thursday’s hearing is whether magistrates can, in certain specific circumstances, circumvent the rules set by the legislator and be more generous than these.

Read also: Article reserved for our subscribers Employment tribunal compensation: amounts down since the creation of the “Macron scale”

The device at the origin of the dispute is in the form of a scale, with minimum and maximum amounts of compensation depending on the seniority of the employee. The aim is to offer “predictability” to employers and “remove the fear of hiring”.

Appellate Courts Guerrilla

As soon as it came into force, this reference caused a sling. From the end of 2018, several industrial tribunals refused to comply, on the grounds that it would violate treaties signed by France, including convention no.oh 158 of the International Labor Organization (ILO). This text provides that the court of a country must be able to award compensation “adequate” to the employee abusively dismissed by his boss. However, courts have considered that the grid put in place in 2017 does not guarantee respect for this right. They therefore opted out of the scale – because of its “unconventionality” – and granted amounts above the ceilings.

Read also The cap on industrial tribunal compensation deemed contrary to international law

This situation caused a great mess because, at the same time, many industrial tribunals applied the maximum established by the legislator. To untangle the imbroglio, the Court of Cassation was seized to give its opinion. This it did, in July 2019, indicating that the framework defined in the 2017 ordinances was compatible with the ILO convention. Its assessments had no binding power, but the government was delighted with this clarification, which made it possible to close a “short legal episode”according to the formula of Muriel Pénicaud, then Minister of Labour.

Such was not the case since the guerrillas continued. Several courts of appeal have considered that they have the option of verifying whether the scale of compensation offers sufficient financial compensation, with regard to the damage suffered by the employee and his particular situation (age, state of health, possible disability, etc). In the language of lawyers, we speak of a concrete control – or in concrete terms – law enforcement.

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