Collective performance agreements (APC) were created by the Macron orders of 2017.
Since then they have been regulated by article L.2254-2 of the Labor Code. This is a new tool among the tools put in place to support restructuring (collective contractual termination, mobility leave, etc.). Their main impact is to make it possible to modify the employment contract of employees and to secure the dismissal of employees who refuse it without requiring an economic reason for dismissal.
The case law is still in its infancy. This is why it is interesting to examine the first decisions rendered by trial judges.
A recent judgment of the Nancy Court of Appeal has just been rendered on the subject of a collective performance agreement (Cf. in Attachment, CA Nancy, February 6, 2023, No. 21/03031).
In this case, a “collective internal mobility performance agreement” was canceled for formal reasons in the derogatory negotiation with the social and economic committee (CSE) since there was no union representative in the company .
The requirement of strict compliance with the derogatory negotiation rules
It is clear from this decision that the Court pays particular attention to compliance with the rules of negotiation: “The validity of such an agreement, with regard to the far-reaching issues with regard to employees, must therefore be assessed by ensuring scrupulous compliance with the negotiation rules definedwith regard to agreements concluded in companies without a trade union representative and works council – a situation which is not disputed be that in which the company finds itself. [société] -, in articles L.2232-27 and following of the labor code, failing which its nullity is incurred.»
In this case, the employer is criticized for not having applied the provisions of article L.2232-29 of the Labor Code which apply in the event of derogatory negotiation and which provide in particular that the negotiation between the employer and the CSE takes place respecting the “consultation with employeesand that this obligation does not rest solely on the CSE.
However, the Court observes that “it is not disputed that the employees were at no time consulted and solicited, through the management or their representatives.»
According to the judgment,it was up to the employer either to carry out the consultation of the employees himself, or to ensure that the elected employees would do so within the framework of an agreement on the method, insofar as this consultation is fixed not in the interest of the parties to the agreement, but for the benefit of the employees concerned by its application”.
“Therefore, the absence of the essential phase of consultation with the employees undermines the regularity of the conditions under which the collective performance agreement was concluded.»
Failure to comply with this consultation rule, which relates to the form of the negotiation and not to the substance of the agreement, will result in the latter being cancelled.
This confirms in any case that in terms of derogatory negotiation, it is imperative to scrupulously respect the rules of negotiation, failing which the very validity of the agreement which would have been signed would be tainted.
Recognition of the possible recourse to derogatory negotiation for the signature of an APC
The judgment also confirms that a collective performance agreement can perfectly well be negotiated and signed according to a derogatory form of negotiation with the CSE. Collective bargaining with trade union delegates appointed by the representative trade union organizations is therefore not the only possibility for negotiation of an APC.
Recognition of the possible recourse to the APC in the event of a site closure
In addition, the Court confirms the possibility of using the APC in the event of site closure and this, by taking the opposite view of the administrative details appearing in the questions and answers published by the Ministry of Labour, Employment and Integration in July 2020.
The Ministry of Labor indicates that:the collective performance agreement cannot be used for the permanent closure of a site or an establishment, when this closure entails the relocation of all the positions and functions of the site or establishment and that the conditions redeployment proposed to employees by the employer within the framework of the agreement have characteristics such that a refusal by the vast majority of the employees concerned can be anticipated with a high degree of certainty (e.g.: moving from one site to several hundred kilometers leading to the necessary geographical mobility of employees).
Indeed, the collective performance agreement cannot replace the provisions applicable to collective dismissal for economic reasons which are binding on any employer whose situation corresponds to the legal provisions. The use of the collective performance agreement in such a situation could constitute an abuse of rights intended to circumvent the provisions provided for in articles L.1233-2 and following of the Labor Code, this offense being likely to be noted by means of a report sent to the Public Prosecutor by the labor inspectorate, in accordance with the provisions of article L.8113-7 of the same code.»
This clarification cast doubt on the principle of recourse to the APC in the event of site closure. The Ministry of Labor prohibited it but seemed to limit this prohibition to well-identified cases (relocation of all positions and insufficient reclassification conditions resulting in the vast majority of employees refusing geographical mobility), which some seemed to forget by retaining an extensive and absolute interpretation of this prohibition: the APC can in no case be used in the event of closure of an establishment.
However, nothing in article L.2254-2 of the Labor Code went in this direction and did not justify this absolute and excessive position, since, under the terms of this provision, the APC can legitimately «determine the conditions of mobility […] geographical internal to the company».
The Nancy Court of Appeal clarified: “The appellants challenge the validity of the agreement on the grounds, firstly, that it organizes the closure of a site, which would not correspond to the scope of collective performance agreements and, secondly, that it resulted in a reduction in the workforce, the employees made redundant for not having accepted the modification of their employment contract not having been replaced.
Or, on the first point, [le juge reconnait qu’] such a limitation is not provided for in article L.2254-2 of the labor code. In addition, the collective performance agreement may be concluded for an indefinite period pursuant to Article L.2222-4 of the Labor Code – as is the case here -, which authorizes irreversible measures . Finally, such an agreement being able to determine the conditions of mobility (…) geographically internal to the company, it follows that it can organize the transfer of all the staff assigned to a site to another site of the business and the closure of the firstr.»
On the second point, however, the Court provides a safeguard: “On the other hand, a collective performance agreement cannot have the purpose or effect of eliminating positionsas it is only a question of adjusting working conditions, concerning the duration and organization of work, remuneration and the professional and geographical mobility of employees. It is therefore appropriate that the employerwhich alone has the evidence, justifies the replacement by new employees of all the employees dismissed for not having accepted the modification of their employment contract.»
This last precision can be understood but should not be absolute, the employer being able to adapt his project and not necessarily replace all the positions which would not be transferred.
Here again, article L.2254-2 of the Labor Code does not expressly prohibit the implementation of an APC from leading to job cuts.
However, it is true that if the employer does not replace all the positions, there could be an abuse of rights and a diversion of the object of the APC while other tools such as collective contractual termination (RCC ) or collective redundancy would have been more appropriate.
It is therefore advisable to remain cautious on the subject and not to commit abuse in the use of the APC by ensuring that employees dismissed under the APC are replaced.
This judgment is therefore very important and confirms that there is no incompatibility in principle between a collective performance agreement and a site closure.
In any case, it seems prudent to replace on the host site all the employees (or a very large majority) who refuse their transfer. Thus no job cuts would be made within the company and no criticism could be made to the APC.
Like all these new tools which can have powerful effects, it is therefore recommended to handle them with care and reflection.
Guillaume Bossy, Associate Lawyer, CMS Francis Lefebvre Lyon Avocats
DOCUMENT A TELECHARGER
Nancy CA, February 6, 2023, No. 21/03031
