Salary claims: super-privileged claims
The principle ?
In the context of collective proceedings, the employee is particularly protected: he is not an ordinary creditor.
What protections?
A super-privilege of wages: employees do not have to declare their claims, unlike other creditors, and will be paid in priority over other creditors
A guarantee of payment of wages by the AGS, which advances the funds under conditions, when the company does not have sufficient cash.
AGS: presentation
The AGS is a guarantee fund whose objective is to avoid, in the event of collective proceedings, that employees are not paid or wait to be paid:
According to article L.3253-6 of the Labor Code , employees, including those seconded abroad or expatriates, are insured against the risk of non-payment of the sums due to them in execution of the employment contract in in the event of safeguard, reorganization or judicial liquidation proceedings.
Subsidiary nature of the intervention of the AGS: it is only in the absence of available funds in the company that the agent draws up a statement of receivables which will be sent to the CGEA (management center) which will carry out, on behalf of of the AGS, advances to the legal representative/liquidator.
AGS: receivables and warranty periods (general)
AGS insurance covers:
Salaries/severance pay prior to the judgment of RJ or LJ;
Severance pay if the dismissal has taken place:
- during the observation period;
- in the month following the judgment which stops the plan of safeguard, RJ or transfer;
- within 15 days following the judgment of liquidation; during the provisional maintenance of the activity authorized by the judgment of LJ;
Receivables resulting from the termination of the employment contract of employees to whom the personalized redeployment agreement was offered;
In case of LJ, within the limit of a month and a half of work, the sums due:
- during the observation period;
- during the 15 days following the judgment of liquidation or the month following the judgment of
- liquidation for the employee representatives provided for;
during the temporary maintenance of activity.
AGS: Limit of Warranty
Support limits?
AGS coverage is limited to a ceiling.
The ceiling varies according to the seniority of the employment contract on the day of the opening of the collective procedure:
< 6 months – Ceiling 4 = 54,848 euros
> 2 years – Ceiling 5 = 68,560 euros
> 2 years – Ceiling 6 = 82,272 euros
License in RJ or LJ
The principle ?
The opening of collective proceedings does not automatically lead to the termination of the employment contract.
The dismissal procedure?
The procedure will be different depending on the following situations:
Dismissals to take place during the observation period (RJ) and the period of maintenance of activity (LJ) or after the adoption of the plan (RJ) or the pronouncement of the LJ;
Collective dismissals of – 10 employees or at least 10 employees in companies with a minimum of 50 employees, over a period of 30 consecutive days (obligation to establish a PSE).
Dismissals during the observation period in the event of RJ (=dismissals of an urgent, unavoidable and indispensable nature) and during the period of temporary maintenance of activity in LJ |
Dismissal after the adoption of the recovery / transfer plan |
Dismissal in LJ without continuation of activity |
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Dismissals of – 10 employees |
Layoffs of + 10 employees (PSE) |
Dismissals of – 10 employees |
Layoffs of + 10 employees |
Dismissals of – 10 employees |
Layoffs of + 10 employees (PSE) |
| 1- Information-consultation of the CSE | 1- Information-consultation of the CSE | 1- Information-consultation of the CSE | 1- Information-consultation of the CSE | 1- Information-consultation of the CSE | |
| 2-Information of the Direccte and preparation of the PSE (negotiations with the CSE) | 2-Information of the Direccte and preparation of the PSE (negotiations with the CSE) | 2-Information of the Direccte and preparation of the PSE (negotiations with the CSE) | |||
| 2- Request for authorization from the supervising judge accompanied by the opinion of the CSE | 3- Request for authorization from the supervising judge accompanied by the opinion of the CSE + decision of the Direccte | 2- Adoption of the RJ plan/transfer plan by the Commercial Court | 3- Adoption of the RJ plan/transfer plan by the Commercial Court | 1-Judgment of liquidation by the commercial court | 3- Liquidation judgment by the commercial court |
| 3- Order of the supervising judge authorizing the dismissals | 4- Order of the supervising judge authorizing the dismissals | 4- Notification of the PSE to the Directte | 2- Information from the Management | 4- Information of the Direccte and preparation of the PSE | |
| 3- Information-consultation of the CSE | 5-Information-consultation of the CSE | ||||
| 4- Reclassification research | 3- Search for reclassifications | 5- Reclassification research | 4- Search for reclassification | 6- Search for reclassification | |
| 7- Notification of the PSE to the Direccte accompanied by the consultation report | |||||
| 5- Preliminary interviews + CSP proposal | 4- Preliminary interviews + CSP proposal | Prior interview unless the company has staff representatives | 5- Information prior to dismissal |
8- Information prior to dismissal
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| 6- Notification of dismissals | 5- Notification of dismissals | 5- Notification of dismissals in the month following the adoption of the plan | 6- Notification of dismissals in the month following the adoption of the plan | 6- Notification of dismissals within 15 days of the liquidation judgment | 9- Notification of dismissals within 15 days of the liquidation judgment |
Consequences of judicial assignment on employment contracts
The principle ?
The sale, even partial, of the company, may be pronounced pursuant to Articles L 626-1 (safeguard), L 631-22 (RJ) or L 642-2 (LJ) of the Commercial Code and result in the transfer of an autonomous economic entity retaining its identity.
The results ?
Automatic transfer to the transferee of the current employment contracts of the transferred entity:
- Automatic transfer: no formality is required apart from informing and consulting the CSE and, in companies with less than 250 employees, informing the personnel;
- Continuation of the contract under the previous conditions (qualification, remuneration, seniority, acquired paid leave, etc.);
- This transfer is binding on the employees, who cannot oppose it.
As an exception, the transfer of employment contracts does not apply to dismissed employees:
- During the observation period;
- As part of the disposal plan approved by the judge
