The draft law on the labor market adopted by the Council of Ministers

The Council of Ministers has adoptedé the draft law on the modernization of the labor market, which transposes the interprofessional agreement reached by the social partners. The text will be examinedé by the Assembléeée nationale from April 15 to 17, then by the Sénat on May 6 and 7.

The bill to modernize the labor market, presented to the Council of Ministers on March 26, remains faithful to à the preliminary draft bill sent to the social partners, à with a few minor adjustments (see Bref social n° 15067 of February 28, 2008). Immediately after promulgation, the law will be supplemented by four decrees (see page 2). Two orders are also expected: the order extending the ANI (see Conv. -Accords, interpro.- n° 22/2008 du 28 février 2008) and the order dictating the standard form for the conventional termination agreement. In addition, a tripartite working group will be working on the content of this standard form. And a second group will meet on March 31 to set a floor and a ceiling for damages to be paid in the event of dismissal without just and reasonable cause, and to define the terms and conditions for disclosing the reasons for dismissal in the letter of dismissal.

The draft law will be published in French on March 31.

The bill still provides that CNEs concluded before the future law comes into force will be requalified as CDIs under ordinary law.

Trial period

The bill to modernize the labor market, presented to the Council of Ministers on March 26, remains faithful to à the preliminary draft bill sent to the social partners, à with a few minor adjustments (see Bref social n° 15067 of February 28, 2008).

The bill sets a maximum duration for the CDI trial period, rather than a range of durations. This maximum duration will be égale à two months for blue-collar and white-collar workers, three months for supervisors and technicians, and four months for managers.
The other provisions relating éto the trial period remain unchangedées. Thus, the trial period may éonly be renewed once if a branch agreement éso provides. The maximum duration of the probationary period, including renewals, may not exceed four, six or eight months respectively.
The durations of the probationary periods laid down by law will be binding. However, industry agreements concluded before the law came into force and setting longer trial periods will continue to apply. Industry agreements setting shorter terms will remain in force until June 30, 2009. In all cases, the letter of engagement or employment contract may specify shorter terms. Should the trial period be terminated, the employer will be required to respect a notice period ranging from 48 hours to one month, depending on how long the employee has been on the job. The period of notice may not extend the trial period beyond the maxima referred to above. Lastly, the employee breaking the trial period must respect a 48-hour notice period.
If the employee is hired by the company at the end of the trial period, the internship completed during the last year of study will be partially counted as part of the trial period.

Conventional termination

Representing the provisions of the draft bill, the text sets out the principle and procedures for the conventional termination of the employment contract.
The employer and employeeé may agree to this termination during one or more meetings. The employee may be assisted by a company employee of his or her choice (an employee holding a trade union mandate, a member of an IRP or any other employee), or by an employee advisor chosen from a list drawn up by the administrative authority. This possibilityé of assistance will be open à to the employer when the employeeé makes use of it himself.
The termination agreement will define the terms of the termination, in particular the amount of the specific indemnityé which may not êbe less than à that of the legal redundancy indemnityé. It will set the date of termination of the contractual relationship, which may not be earlier than êthe day after the date of approval.
À From the date of signature of the agreement, each party will have 15 days to exercise its right to withdraw by sending a letter by any means that can prove its date of receipt.
À At the end of this period, the earliest party will send a copy of the agreement to à the « administrative authority » i.e., according to the explanatory memorandum to the bill, the « directeur départemental du travail et de l'emploi ». The latter will have a maximum of 15 days to approve the agreement. In the absence of an explicit decision, approval will be deemed to have been granted. Approval, which is a condition of the agreementés validity, will attest to compliance with the formal requirements applicable to the contractual termination of employment à and to the partieséfreedom of consent.
Any dispute concerning the termination agreement, its homologation or refusal of homologation will fall under the jurisdiction of the Conseil des prud'hommes, à to the exclusion of any other contentious or administrative appeal.
Protected employeesémay agree to a conventional termination. However, the termination will not be subject to à homologation, but à authorization by the labor inspector under the conditions of ordinary law.
The provisions relating to à the conventional termination will not be applicable to measures relating to GPEC agreements and PSE.

Termination compensation

The length of serviceé in the company to qualify for severance pay will be increased from two à one year. In addition, the distinction between compensation for dismissal on economic grounds éand on personal grounds will be abandoned, giving way à to a single amount fixedé per decree (see below).
The bill also prescribes the tax and social security exemption scheme for the special severance pay (see above) for employees under 60: the applicable exemption ceilings are the same as for redundancy pay. According to the explanatory memorandum, employees who have reached retirement age will be subject to the same tax and social security rules as those applicable to retired employees.
In the event of dismissal for non-occupational unfitness, the compensation due to the employee for the termination of employment may be paid either by the employer, or by a mutualization fund to be borne by the employers. Management of this fund will be entrusted to à the Association pour la gestion du régime d'assurance des créances des salariés (AGS).

CDD à objet précis

À On an experimental basis, for five years à from the date of entry into force of the law, a fixed-term contract, with a minimum duration of 18 months and a maximum duration of 36 months, may êbe concluded with engineers and managers, for the reéalization of a finite object, under the following conditions.
The collective agreement establishing it (branch agreement or, édéfaut, company agreement) will define the economic nécessities éto which these contracts are likely to provide an adapted responseéIn addition, the contract will specify the conditions under which employees will have priority access to permanent jobs, and the conditions under which employees will benefit from guarantees in terms of outplacement assistance, VAE, etc.
The contract will have to include certain particulars, notably the titleé and the références of the collective agreement instituting it, a description of the project, mention of its durationéa description of the project, an indication of its anticipated duration, the completion of the work, the événement or the objective result leading to the end of the contract à specified purpose.
The contract will end with the completion of the object for which it has été been concluded, after a délai of prévenance at least égal à two months. It may êbe terminated à on the anniversary date of its conclusion by either party for just and serious cause. It may not êbe renewedé. If, à at the end of the contract, the contractual relationship is not continued by a permanent contract, the employee é will be entitled à to compensation é égale à 10% of his total gross income.

Portage salarial, sickness, etc.

The bill incorporates other provisions of ANI nécessing legislative transposition.
When the employment contract is terminated, the employer will have to dédeliver to the employeeé a reçu pour solde de tout compte which will list the sums paidées to the employeeé. This statement may be revoked by the employer within six months of signature, after which time it will become binding on the employer.

Liaisons Social

Liaisons Sociales Quotidien, 27/03/2008