Restrictions of the damages that can be compensated before the Labour Court in case of employer’s specific liability in the context of an accident at work or occupational disease (“faute inexcusable”) which leads to a dismissal for physical incapacity

The French Supreme Court overturned its long-standing policy in a decision of October 6, 2015 (FSC, October 6, 2015, No. 13-26052 FS-PB). Prior to this decision, the French Supreme Court had repeatedly sentenced employers to damages for loss of employment in cases where the employees had been dismissed for physical incapacity due to the employer’s “faute inexcusable”. The French Supreme Court indeed considered that “where an employee has been dismissed for physical incapacity due to the employer’s “faute inexcusable”, he is entitled to compensation repairing loss of employment due to the failure of the employer” (FSC, May 17, 2006, No. 04-47455) regardless of any damages granted by Social Security Courts. The Supreme Court considered that loss of employment and loss of pension rights were associated with the termination of the employment contract, and therefore must be claimed before the Labor Courts, these claims being distinct from the compensation granted by Social Security Courts (FSC, January 26, 2011, No. 09-41342).

In its decision of October 6, 2015, the Supreme Court overturned this rule. It now considers that the claim for loss of employment and the rights to retirement consecutive to a dismissal for incapacity must be treated as damages directly linked to the consequences of the accident at work. These damages being already compensated by the increased pension granted because of the employer’s “faute inexcusable” by the Social Security Courts, they can no longer be claimed before the Labour Courts.

This new policy of the French Supreme Court does however not affect the possibility for the employees to bring claims on the validity of their dismissal before the Labor Courts, damages for unfair dismissal being out of the Social Security Courts’ jurisdiction.