COVID-19 and Employment contracts

Human resources in times of crisis

In many countries, labour laws usually protect employees. In this period of crisis, different kinds of problems arise: some companies face an obligation to stop or reduce their activity, while others need to carry on (or even produce more) in a complex sanitary framework.

How should an employer react when employees cannot go to the office (for sanitary or childcare reason)? Can an employer stop paying an employee if there is a diminution of work? Are there restrictions to redundancy plans during the crisis ?

Our experts give an overview of the financial support measures provided by the governments during the pandemic and of those restricting the possibility to terminate employment contracts.

They also present the leverages offered to employers to adapt working conditions during the emergency period.

Check out the FAQs of the country of your interest and get in touch with our experts for more information.

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France

How to deal with a reduction of business during COVID-19 pandemic ? Can I impose a reduction of working time to my employees ?

Downtiming can be used by companies who face a drecrease of activity or if they cannot organize the activity in a way to prevent contacts (either by working from home or by organizing social distancing in the workplace).

An authorization shall be requested online : https://activitepartielle.emploi.gouv.fr/aparts/

Foreign companies without a permanent establishment in France can now benefit from this system, provided that their employees work under a contract subject to French law and they pay social contributions in France.

The deadline to file a request to cover the period since mid-March is the 30th of April. Otherwise, it shall be filed within the month of starting downtiming. Without any refusal from the State within 48 hours, the authorization is granted.

It allows the employer to pay 70% of the average gross remuneration for each hour which has not been performed due to the reduction of activity, and to be reimbursed of this amount by the State.

Reduced contributions apply to this sum, which means that employees receive around 84% of their average net remuneration.

If the company has staff representatives, the latter shall be consulted on the implementation of downtiming and their opinion shall be sent to the Administration within 2 months following the request.

One important condition is that all employees working in the same working unit are treated the same way : downtiming cannot be applied to only one person, or with a variable way from one person to another, unless we can explain that they do not work in the same working unit, or that the difference is justified by a specific experience. In the latter case, then those explanation shall be represented to the staff representatives, who shall agree with it. Another option is to conclude a company collective agreement.

If those conditions are not met, the company may be requested to pay the money back to the State in case of a control, which could happen in the next years.

 

What if I had just hired someone ? Can I take my employment offer back?

If a firm offer (mentioning missions, remuneration and date of start) was made and already accepted, then there is already a biding contract, whether a formal one has been signed or not.

This means that an employer who would withdraw their offer without consent of the employee could be sued for damages for irrespect of a hiring promise. If we take into account previous case-law in France on diverse pandemics, there are high chances that COVID-19 would not be seen as force majeure allowing for not respecting the employment contract.

Nevertherless, hiring can be deferred (with the consent of the employee), and recent rules allow employees concerned to benefit from unemployment allowances during this period, even if they had resignated from their previous job and would therefore usually not be eligible to those allowances.

Termination of notice period could not either be considered as a valid option, at least not until a sufficient number of days has been performed to be able to acknowledge the professionnal competencies of the newly recruited employee.

However, downtiming is possible with new employees without restrictions, and if it leads to the suspension of the contract, then the trial period is suspended too and will start again when the employee is able to come back to work.

Can I impose my employees to take their remaining days of paid leave?

A recent order has been passed to allow employers to impose employees to take compensatory resting days (with a limit of 10).

As regards paid leave, this is possible, within a limit of 6 days, only if the company negotiates a company collective agreement on this topic, or if it is covered by a sector collective bargaining agreement. So far, metal industry and engineering consulting firms sector have negotiated such possibilities.

Another option can be to close down the company, which then allows to impose the paid leave dates, subject to a consultation of staff representatives and information of employees in due time (this deadline varying from one sector to another).

How to deal with employees that cannot go to work/provide work from home, because they have to take care of their children?

During the period from mid March until the end of April, employees who had to take care of their children were covered by a specific « sick leave » allowing them to receive 50% of their salary from the social security system, and, most of the times (depending on seniority and applicable CBA) the remaining part of salary paid by the employer.

From the 1st of May, they will be covered by the downtiming system presented in question 1 (70% of their salary, fully reimbursed to the employer by the state).

From the 1st of June, this coverage will be maintained only if they can provide a certificate from the school confirming that the children could not go back to school.

What should I do if there is still some business to do? How can I anticipate the end of the lock-down?

During the lock-down, and highly probably also afterwards, a priority is given to homeworking.

Companies have been strongly encouraged to organize homeworking as much as they could.

When it is not possible, then the employer has a duty to organize the workplace in a way that respects social distancing. Indeed, as a general rule, employers shall prevent employees from getting sick at work. This obligation is even stronger nowadays. Their liability could be seeked otherwise.

This means that organization of production and work shall be adapted to these new requirements: organization of the office/production line respecting social distancing, provision of soap and/or hydro-alcoholic solution to employees, modification of working hours to avoid crowdy offices or to reduce the use of collective transports,…

Those new means and organizational rules shall be registered, especially in the mandatory risk assessment document. Where there are staff representatives, they shall be associated to this thinking, as well as the occupational doctor in charge of the company.

Do I have the right to terminate contracts in this period?

Yes.

Termination of contracts (conventional termination agreements as well as dismissals or redundancy plans) can validly be decided.

The only difficulties which might arise are related to the formal procedures which shall still apply. For example, a mandatory preliminary meeting is required by law and can hardly be organized in this period. As a solution, a video conference can be organized, but subject to the consent of the person concerned.

In the same way, some procedures require the authorization or verification of the administration : then, the company should anticipate that the timing will be longer than usual, due to deadline suspensions.