Harmonization of vacation pay legislation
In two rulings dated September 13, 2023, the French Supreme Court (Cour de cassation) brought French vacation pay law into line with European law.
Previously, under the French Labor Code, periods of absence due to illness, whether work-related or not, were not fully taken into account when calculating paid leave. This practice was contrary to European Union law.
Court of Cassation decisions
The Cour de cassation has issued the following two decisions:
Acquiring paid leave during non-work-related sick leave
The French Supreme Court has ruled that the provisions of French law do not comply with European Union law.
In other words, employees suffering from an illness or accident of any kind, whether occupational or non-occupational, will continue to acquire paid leave entitlements for the duration of their absence from work.
(Cass.soc. September 13, 2023, no. 22-17.340)
Acquiring paid leave after a workplace accident
Contrary to previous French law, the French Supreme Court has ruled that in the event of an accident at work or occupational disease, vacation pay cannot be limited to one year.
From now on, paid leave will be earned for the entire duration of the work stoppage, and will no longer be limited to a single year.
(Cass. Soc. September 13, 2023, no. 22-17.638)
Things to remember :
- Paid leave must now be calculated taking sick leave into account.
- This decision applies to the 5 statutory weeks of paid leave, as well as to conventional vacations.
- For earlier periods, companies are advised to check whether adjustments are necessary for the last three years, as vacation pay is in the nature of wages and is subject to a three-year statute of limitations. In this case, you’ll need to set aside a provision if necessary.
Worth knowing:
These rulings also raise an important question concerning the limit on paid vacation entitlement for employees on sick leave.
If the employee is off work for several years, will he or she continue to earn paid vacation that can then be carried forward?
For the time being, the answer is yes, unless your company’s collective bargaining agreement sets a time limit on the deferral of paid vacations.
For example, European case law has accepted a 15-month carry-over period for annual leave entitlement, but considered a 9-month period to be too short.
This deferral right must therefore be limited to at least 12 months.
In anticipation of the expected and necessary legal changes to frame this new case law, DESRUMAUX AVOCATS is at your disposal to answer any questions you may have concerning the management of paid leave for your employees on sick leave.
