On August 8, France adopted a revised labor law titled Work, Modernization of Social Dialogue, and Securing of Professional Processes, which modified the rules relating to transferring employment contracts under French law. In their LawFlash (Changes to Transferring Employment Contracts in France After the 8 August Law), partner Sabine Smith-Vidal and associate Charles Dauthier examine the changes introduced by this new law, which may apply to transferring employees in an outsourcing.
In general, for both a legal transfer and a conventional transfer of employees under French law, the transferee remains bound by the transferred employee’s employment contract terms, which can lead to differences in treatment between the transferred employees and the existing employees of the transferee organization. Under the prior rules, if transferred employees enjoyed more advantageous employment terms, the existing employees could generally seek the same advantages as transferred employees under the principle of “equal pay for equal work,” regardless of location.
Among other changes, the new rules modify these equal treatment requirements in certain circumstances for existing employees of an organization when that organization receives transferred employees. Under the new rules, for certain categories of services, existing employees located at different sites from the transferred employees may no longer seek more advantageous terms enjoyed by transferred employees. The new rules do not affect existing employees at the same location as transferred employees, who may still seek any superior benefits enjoyed by the transferred employees.