France: The Macron Scale for Damages rejected by the Paris Court of Appeal

Before 2017, employees whose dismissal was recognised as being unfair (without a real and serious cause) and who had at least two years’ seniority in a company with more than 11 employees, could receive compensation of at least 6 months’ salary.

Since the introduction of the so-called “Macron Scale” (a mechanism introduced on 24 September 2017 to provide for caps and floors on damages for unfair dismissal), the compensation for dismissal without a real and serious cause must be ‘between a floor and a ceiling’ depending on the employee’s seniority. These scales have been the subject of a wave of challenges before the industrial tribunals; the tribunals were asked to carry out a judicial review in order to check if they were compliant with international instruments, and set aside their application if necessary.

In a decision dated 16 March 2021, the Paris Court of Appeal rejected the application of the Macron scale, basing its decision on the provisions of Article 10 of Convention No. 158 of the International Labour Organisation.

The Court considered that “taking into account the concrete and particular situation” of the employee, who was 53 years old on the date of termination and 56 years old on the day of the hearing, the amount provided for in Article L. 1235-3 of the Labour Code does not allow for an adequate and appropriate compensation of the loss suffered.

The judges noted that the maximum amount provided for by the scale represented “barely half of the loss suffered in terms of reduced financial resources since the dismissal”. For the Court, this loss corresponds to the difference between the income from work and the compensation paid to the former employee by French Unemployment Services (Pôle Emploi).

Therefore, we must await the position of the French Supreme Court to know the ultimate fate of the Macron Scale.