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French Supreme Court approves the Macron Scale for dismissal damages

French Supreme Court approves the Macron Scale for dismissal damages

By Ambre Dalbes - Fromont Briens | Littler

On 11 May 2022, the French Supreme Court issued two long-awaited decisions on the statutory scale of indemnification—i.e., the Macron scale—currently applicable in cases of dismissal without cause.

As a reminder, ordinance n° 2017-1387 of 22 September 2017, introduced the Macron scale of indemnification in cases alleging dismissal without real and serious cause (Article L.1235 of French Labour Code). This scale provides minimum and a maximum compensation that can be awarded to plaintiffs in such cases based on months of gross salary, the amount of which depends on the number of the employees within the company and the seniority of the employee.

Since the beginning of its enforcement, the scale has been highly criticised and challenged before the French Labour Tribunals and Courts of Appeal. Many French Labour Courts have opposed this scale, arguing that it is not compliant with European and international standards.

Specifically, some courts determined that the application of this scale does not allow them to provide employees with adequate compensation in accordance with Article 10 of Convention No. 158 of the International Labour Organization (ILO) and Article 24 of the European Social Charter.

After many legal disputes and a specific hearing on 31 March 2022, the French Supreme Court held that the Macron scale is valid and that:

  • The scale is conventional and is not in conflict with Article 10 of Convention No. 158 of the ILO;
  • The judge cannot discard the scale based on the evidence; and
  • The European Social Charter has no direct effect in French law.

Going forward, in accordance with these decisions, the tribunals will no longer be able to refuse to apply the legal damages scale.

This decision is obviously good news for employers, since the scale ensures a degree of legal predictability in the event of litigation following a dismissal.