In France, in the event of dismissal without real and serious cause (Article L.1235 of French Labor Code), the judge grants the dismissed employee an indemnity to be paid by the employer to compensate “the prejudice resulting from the unjustified nature of the loss of employment”.

Before September 2017, there was no ceiling on that compensation. In 2017, Ordinance No. 2017-1387 of 22 September profoundly modified the compensation regime, introducing the so called  ‘Macron scale’, that provides an award compensation ranging between minimum and maximum amounts set in terms of number of months’ salary, depending on the employee’s seniority and the number of employees in the company, ensuring a degree of legal predictability in the event of litigation following a dismissal.

However, its application has been strongly challenged by trade unions and employees’ lawyers, arguing that argued that this scale was not compatible with European and International Conventions.

Specifically, some courts determined that the application of this scale does not allow them to provide employees with adequate compensation in accordance with Article 10 of Convention No. 158 of the International Labour Organization (ILO) and Article 24 of the European Social Charter.

The Supreme Court, after many legal disputes and a specific hearing on 31 March 2022, stated that the Macron scale is valid based on the following considerations:

• the ‘Macron scale’ does not contravene Article 10 of ILO Convention No. 158, which provides for the payment of “adequate compensation”, stressing that French law provisions sufficiently prevent employers from dismissing without cause and that the current system allows for reasonable compensation for the unjustified loss of employment;
• Article 24 of the European Social Charter, which provides for the “right to protection in case of dismissal,” cannot be invoked directly by an individual before the French courts;
• French judges cannot, even on a case-by-case basis, reject the application of the Macron scale. At the same time, the Court rejected the possibility of applying the Macron Scale on a case-by-case basis (for example for employees facing specific difficulties, such as employees at least 50 years old, with a low seniority, have difficulties finding a job after the termination of their employment contracts, etc.), as this would create uncertainty regarding the applicable rule of law and undermine the principle of equality of citizens before the law.

In accordance with these decisions, tribunals will have to continue to apply the legal damages scale, that provides certainty to companies with employees in France.