Distinction between salary payable over a period of 13 months and thirteenth month premium.

In a decision of October 17, 2018, the French Supreme Court clarified that the clause of an employment contract providing for a salary payable over a period of 13 months must not be confused with the clause of a collective agreement granting a thirteenth month gratification.

Indeed, the former is a payment type clause (in the form of thirteen monthly payments), whereas the later corresponds to an actual gratification.

These two advantages (the first stemming from an employment contract and the other from a collective agreement) do not follow the same purpose and should therefore be combined.

From a practical perspective, the employer must be careful when drafting the employment contracts and make sure it precisely defines the source of the thirteenth month payment, for instance by making a clear reference to the collective agreement providing for the annual gratification of the thirteenth month, otherwise the employee may be exposed to the payment of fourteen months of salary in total.

French Supreme Court, Social Chamber, 17 October 2018, n°17-20.646