Regardless of the size of the company, it is important to have HR systems that allow employees and employers to manage their relationships, particularly with regard to the employment contract. The conventional termination allows, under certain conditions, the termination of an employment contract. So what is the procedure to follow for this termination? What is the deadline for a mutual termination? And what are the necessary conditions for it?
What is a mutual termination?
A mutual termination, as described by the French Labor Code, is a method of terminating an employee's employment contract with their employer. It results from a specific procedure and is different from dismissal and resignation.
It allows the employee and their employer to terminate their professional ties by mutual agreement, according to the terms and conditions of the contract termination. These terms are described in a document: the termination agreement, which will be signed by both parties to the contract, then validated by the relevant organizations. Following a mutual termination agreement, the employee receives compensation.
Who is affected by mutual termination?
Mutual termination only applies to employees with a permanent employment contract (CDI). It does not apply to workers with a fixed-term or temporary contract.
Conditions of mutual termination
Mutual termination cannot, under any circumstances, be a unilateral decision of the employee or the employer. Neither party can impose termination, as it must be mutually agreed upon between the two parties.
Under certain conditions, individual mutual termination may be prohibited. The following cases include:
- If the agreement is not concluded between the employer and the employee;
- If the termination is carried out under fraudulent conditions;
- If the termination is the subject of a collective agreement on collective termination by mutual consent;
- If the termination is proposed as part of a forward-looking employment and skills management agreement (GPEC);
- If the termination is proposed as part of a job protection plan (PSE);
- If the purpose of the termination is to circumvent the guarantees for employees in terms of dismissal economic.
The agreed termination can also be canceled by the industrial tribunal (CPH), if the employee's consent was not freely given during the signing of the agreement. In this case, the employee may receive compensation related to an unjustified dismissal (without valid, real, and serious cause). Examples include cases where the signature was made in a context of harassment or if the employer exerted pressure to force the employee to opt for a mutual termination.
What are the steps for a mutual termination?
In order to proceed with a mutual termination, it is important to go through 5 necessary steps: the request, the negotiation of the mutual termination, the signature, the withdrawal period and the approval period.
The request for mutual termination
Since the agreement between the two parties is necessary for the mutual termination to be successful, a request for termination must first arise from the employee or be the subject of a proposal from the employer. There are no specific formalities for requesting a mutual termination, but as a general rule, it is advisable not to make a written request; a simple oral request will suffice.
Negotiating compensation
To continue the process of a mutual termination, it is necessary for the two parties involved to meet on one or more occasions. During these meetings, the employee may be assisted by either an employee representative or an advisor. The employer may also be assisted by a person of their choice or a member of their union.
The two parties must determine the amount of compensation the employee will receive for the termination. It consists of: statutory compensation and extra-statutory compensation.
Statutory severance pay is equal to 1/4 of gross monthly pay per year of service for the first 10 years. From the 11th year onwards, it is equal to 1/3 of pay. The collective agreement may specify more favorable methods for calculating this amount. The amount of this compensation is not subject to negotiation.
Extra-statutory compensation compensates for any difference with the amount of a traditional dismissal. The employee can also negotiate a higher amount.
Signing
The signing of the severance agreement must be done during an interview. Electronic signatures are not accepted in administrative offices. The agreement must be drawn up and signed in triplicate (for the employer, the employee, and the administration).
The withdrawal period
The employee has a period of 15 days, after signing the agreement, to exercise their right of withdrawal. It is not necessary to state the reasons. In the event of withdrawal, the employee continues to work normally in the company.
The approval period
If there is no withdrawal during the 15-day period following signature, the employer contacts the administration to obtain validation of the mutual termination agreement. After validation, a certificate of approval is sent to the employer; this is the final step in the termination process.
Employee's situation during the mutual termination procedure
During the termination procedure, the employee is still employed by the company and continues their activities as normal, until the contract is finally terminated. The employee can still take paid leave during this period.
