France: 2023, Looking Ahead

Major trends in employment law for 2023 in France

Impact of recent legislation

• Termination of employment contracts in case of employee “no show”

Law no. 2022-1598 of December 21, 2022 “on emergency measures relating to the functioning of the labour market with a view to full employment” aims to limit rights to claim unemployment benefits.

Namely, in case of employees no longer showing up to work, employers were obliged to respect the dismissal process which allowed such employees to claim unemployment benefits.

Employers will now be able to treat such situations as resignations subject to having asked employees to justify their absence and after a certain period (to be defined by decree which should be published in the next few months).

Employees may however challenge this presumed resignation before the labour court namely if the employee can demonstrate that they had a legitimate reason. This could for example include medical reasons but also if they argue they could not return to work because of the employer’s actions e.g., harassment, unsafe working conditions, etc… Employers should therefore seek advice before basing their decision on a presumed resignation.

• New reporting obligation to the French Unemployment Agency (Pôle Emploi)

The same law also provides that employees under fixed-term/temporary work contracts can no longer claim unemployment benefits if they have twice refused the transformation of their contract into an indefinite-term contract to occupy the same or a similar job.

Employers must notify the employee of this proposal in writing and, if the employee refuses, notify the French Unemployment Agency (Pôle emploi), justifying the similarity of the proposed job.

• New flexibility for temporary employment contracts

The same law also opens new possibilities for the use of temporary employment contracts: the total duration of the assignment contract may be extended to more than 18 months when the employee is bound by a permanent contract with the temporary employment company. It also introduces, on an experimental basis, the possibility of concluding a single fixed-term contract or a single assignment contract to replace not one but several employees, the experimentation being however limited to sectors to be defined by decree.

• Staff representative elections

The same law reverses the French Supreme Court’s case law which excluded employees deemed to represent the employer, either because they have a written delegation of authority, or because they represented the employer before the staff representative bodies. Such employees can now vote but are still not eligible to stand for staff representative elections.

• Whistleblowing

The law n° 2022-401 of March 21, 2022 “aimed at improving the protection of whistleblowers”, which transposed EU Directive 2097/1937, came into force on September 1, 2022. The Decree no. 2022-1284 of October 3, 2022, set out new rules with regards the obligation to set up internal whistleblowing systems.

All companies with at least 50 employees have an obligation to adopt a whistleblowing policy and designate individuals who are authorised to receive and handle such reports. Group whistleblowing systems are no longer sufficient. The definition of what can be considered a whistleblowing report has been extended to include all potential violations of French law (thus including many employment grievances). Persons not designated in the policy are no longer allowed to receive whistleblowing reports which can impact already existing alternative reporting lines.

• Diversity & inclusion

Following the law of December 24, 2021, and the Decree no. 2022-680 of April 26, 2022, companies with over 50 employees must report on gender balance of senior executives and members of management bodies by March 1^st, 2023. Companies with over 1000 employees will be publishing this information for the second time which will, this year, also be published on the website of the Ministry of Labour. For memory, companies are due to meet a gender balance objective of at least 30/70 by March 2026.

Upcoming legislation

• The transposition of the EU Directive on transparent and predictable working conditions

The transposition bill is currently under parliamentary discussion. Anticipated new obligations may include:

–   providing additional information in writing to employees on the essential elements of the employment relationship;

–   if requested by an employee with a minimum 6 month fixed-term contract (or a temporary employee), communication of the list of all positions to be filled within the company under an indefinite-term contract.

• The transposition of the EU Directive on work-life balance for parents and carers

The transposition bill is currently under parliamentary discussion. Anticipated new obligations may include:

• paternity and childcare leave as well as part-time parental leave to be counted as a period of actual work within regards claiming benefits based on employment tenure;
• right to retain all benefits the employee acquired before the start of the leave.

• The transposition of the EU Corporate Sustainability Reporting Directive

The transposition bill is currently under parliamentary discussion. Annual CSR reporting, namely on HR matters (diversity & inclusion, workplace harassment, job security, health & safety, fair wages, collective bargaining, work/life balance) will be mandatory from January 1^st 2024 for EU listed companies who meet 2 of 3 the following criteria:  at least 10 employees, 700K€ net revenue, 350K€ balance sheet total or EU companies who meet 2 of 3 the following criteria:  250 staff,  40M€ net revenue, 20M€ balance sheet total or foreign companies who generate over 150M€ net revenue in the EU with a branch office in the EU which generate at least 40M€ net revenue or a subsidiary in the EU

• Pension reform bill

The transposition bill is currently under parliamentary discussion. Anticipated new obligations may include:

–   the legal retirement age will be increased from 62 to 64. As of September 1, 2023, this age will be progressively increased by three months per generation, starting with those born on September 1, 1961. At the same time, the contribution period for a full pension will be increased to 43 years in 2027, starting with the generation born in 1965;

–   persons who started working early will not be required to work more than 44 years;

–   companies (minimum headcount still to be defined) will need to publish annually on the percentage of employment of senior workers (age still to be defined) and measures taken to ensure their continued employment until retirement age;

–   inclusion of the topic of senior workers within the mandatory annual negotiation on management of jobs and career paths (GEPP).

• The Immigration Bill

Parliamentary discussion on the Immigration Bill is expected to start mid-March 2023. Anticipated new obligations may include:

–   the creation, on an experimental basis, of a new 1-year temporary residence and work permit to occupy jobs where there is a workforce shortage;

–   easier access to the labour market for asylum seekers whose nationality makes it highly likely that they will obtain asylum;

–   the creation of a new fine for employers of foreigners who do not have a residence permit authorizing them to work. This fine, imposed by the departmental prefect, will be in addition to existing criminal and administrative sanctions.

• The national plan to combat racism, anti-Semitism and discrimination based on origin for 2023-2026.

Anticipated new obligations may include:

• systematic testing of discrimination in hiring and during a professional career, no specific sanctions are foreseen if situations of discrimination are revealed, but the government may implement a name and shame policy and financial sanctions if companies do not take necessary corrective measures;
• dissuasive civil fine in case of workplace discrimination and punitive damages.