The French Labour Code provides that:
There has however, long been a discrepancy between French and European law on the issue of paid leave entitlement for employees off on sick leave.
In three rulings all dated 13 September 2023, the Cour de Cassation decided to bring French law into line with European and Community law by laying down the following principles:
This major ruling is all the more significant in that it has retroactive effect and is intended to apply to all employment relationships, including those predating the rulings of 13 September.
In a ruling dated 27 September 2023, the Paris Court of Appeal also endorsed the position of the Court of Cassation on the subject of an employee’s accrual of paid holiday leave during periods of absence from work due to ordinary illness.
Another important point to be noted from these rulings concerns the types of leave concerned. Contrary to European law, this entitlement is not limited solely to the acquisition of annual paid holiday leave, but also to any nature of contractual leave.
These case law rulings can therefore be invoked by both current and former employees or those deemed as such (in the case of reclassification of a service provider's contract), including in disputes relating to periods prior to the recent rulings. This is the case regardless of whether the legal texts have been adapted by the French legislator or not.
The Court of Cassation has radically changed the rules concerning the limitation periods, bringing them into line with European law and thereby creating real uncertainty for any employee’s past holiday entitlements.
For the record, until now a 3-year limitation period was in place, and this could only begin once the relevant period of paid leave being taken had expired (i.e. the year following the accrual period). It should be remembered that in the event of an employee contesting, it is up to the employer to demonstrate that all the required steps have in fact been taken to allow the employee to take the paid leave due.
Following this third ruling of 13 September 2023, judges can in the event of a dispute rule that:
What are the recommendations issues to limit potential reactions in the future:
Such an assessment would have to take into account the specific assumptions inherent to each company, and should also be performed for any ongoing litigations.
In conclusion, employers will have to address new issues relating to contract terminations and disputes as well as the adaptation of their company policy on the accrual of paid leave, more particularly on the policy on the deferral of paid leave in company agreements.
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