France: ‘Macron scale’ for compensation in event of unfair dismissal judged in contravention of European Social Charter

As announced in June of this year (see article n°13106), the Council of Europe’s European Committee of Social Rights has judged the capping of labour tribunal compensation – under the ‘Barème Macron‘ (‘Macron scale’) – as in contravention of the European Social Charter. This conclusion, published on Monday 26 September, contradicts decisions passed down by France’s three highest courts: the Council of State (7 December 2017), the Constitutional Council (21 March 2018) and the Court of Cassation (17 July 2019). According to the members of the ECSR, the reform is incompatible with Article 24 of the Charter, which stipulates that employees laid off without legitimate reason are entitled to “adequate compensation”. The committee members strike down the argument regarding the predictability of the cost of recourse to labour tribunals that, in the government’s view, would be permitted by the reform. They also flag the risk of incentivising unjustified dismissals “on the basis of a cost-benefit analysis” made by the employer. Meanwhile the upper limit of the scale is insufficient to “compensate the employee for the damage suffered and to act as a deterrent to the employer”, according to the ECSR. The committee also points out that the upper limit of the compensation scale does not allow the award of “higher compensation on the basis of the personal and individual situation of the worker”, because of its automatic nature. Finally, the ECSR considers that the order creates a legal regime distinct from civil liability, which does not allow for effective compensation for the damages suffered by employees. This decision from the Council of Europe body is not legally binding for the French government.