Guide to Restructuring a Cross-Border Workforce

Yes, there is. An employee is redundant if the following conditions are met:

• the employer adopted a decision on organisational change;
• the change concerns the scope of activities, tasks, technical equipment, number of employees, or otherwise alters the structure of the employer;
• the aim of the change is to increase work efficiency, reduce costs, or otherwise alter the performance of the employer’s enterprise; and
• as a result, the employee’s work is redundant or not needed.

According to case law, the employee’s work is not needed, either at all or at least in part, with the rest being distributed among the current employees or corporate body. Rebranding the position, hiring a new employee to carry out the work of the dismissed employee shortly thereafter, or otherwise fabricating the redundancy with an ulterior motive does not qualify as redundancy.

Czech law provides two other similar reasons based on which an employer is entitled to terminate employment – closing down or relocation of the employer’s undertaking or its part. Together with redundancy, these three reasons are known as “organisational reasons” (in Czech: “organizační důvody”) for termination of employment. However, closing down and relocation of the employer or its part are different reasons than the redundancy itself, and therefore we do not address them further.

Yes; the notion of “dismissal on economic grounds” is defined in the French labour code. In practice, the employer will usually need to show that in France (on a consolidated basis) the group to which it belongs has been suffering “economic difficulties” for a significant period, or that it needs to cut jobs to protect its ability to compete.

If the group has operations in two or more different business sectors, then in principle the economic grounds should be assessed by looking only at the business sector in which the employing French subsidiary operates.

The notion of economic difficulties is generally understood by French courts to mean significant ongoing financial losses. The French labour code was amended a few years ago to give examples as follows:

“economic difficulties characterised either by the significant evolution of at least one economic indicator such as a reduction in orders or turnover, operating losses, or a deterioration of cash-flow or gross operating profit, or by any other factor likely to justify these difficulties.

A significant reduction in orders or turnover is established when the duration of this decrease is, in comparison with the same period of the previous year, at least equal to:

• one quarter for a company with fewer than 11 employees;
• two consecutive quarters for an enterprise of at least 11 employees and fewer than 50 employees;
• three consecutive quarters for an enterprise of at least 50 employees and fewer than 300 employees; and
• four consecutive quarters for an enterprise of 300 or more employees.”

The other possible justifications for economic dismissal are technological changes or the total cessation of business activities by the employing entity.

Usually, the written economic rationale includes a detailed analysis of French financial data for the last three years.

The employer must take the following steps:

• review underlying documents (including organisational charts), decide what organisational change needs to be made and work out which positions are no longer needed, and plan the timing;
• adopt a decision on organisational change, including its effective date and which redundant positions are cancelled. The decision doesn’t have to be in writing or state reasons for the redundancy. However, both are highly recommended and a market standard, as this serves as evidence;
• if there are unions, consult the unions in advance (see question 4), and if a union representative is supposed to be made redundant, obtain the union’s consent in advance (see question 11);
• execute dismissal either by a termination agreement (recommended) or a termination notice with the redundant employees. In case of termination notice, the redundancy must (based on the decision) take effect on or before the notice period expired, not after; and
• implement the organisational change (including updating organisational charts).

Organisational changes may also be governed by collective agreements, in which case additional rules may apply (this applies to all the questions below).

For an individual dismissal on economic grounds, the key steps are the following:

• assess whether the role is unique or whether there are interchangeable roles;
• if there are interchangeable roles, establish the correct pool for selection and the criteria (and weighting thereof) to be used. A selection scoring between the interchangeable roles should then be carried out;
• identify all vacant positions within the group in France; make precise written redeployment offers to the employee at risk of dismissal, to try to avoid dismissal;
• if the employee cannot be redeployed, send a letter asking them to attend a meeting to discuss possible dismissal. Hold the meeting at least a week later. If the company belongs to a group with fewer than 1,000 employees in Europe, it must offer the employee a state redeployment programme called the contrat de sécurisation professionnelle (CSP) during the meeting. If the employee accepts the CSP within 21 days, the employment terminates at the end of that period. If not, the employer can issue a written notice of dismissal on the expiry of a waiting period of seven working days (or 15 working days for a white-collar employee) after the dismissal meeting; and
• if the group employs at least 1,000 employees in Europe, the employer must instead offer a company-sponsored redeployment programme (congé de reclassement) when it issues a written notice of dismissal, which it can do on after a waiting period of seven working days (or 15 working days for a white-collar employee) after the dismissal meeting.

For the collective process: see questions 3 and 6.

Yes, Czech law provides a special procedure for “collective dismissal” in all three cases of organisational changes (see question 1).

The threshold is:

• ten employees if the employer has 20 to 100 employees;
• 10% of employees if the employer has 101 to 300 employees; and
• 30 employees if the employer has more than 300 employees.

The respective number of employees must be dismissed due to redundancy within a period of 30 days. If at least five employees are dismissed within 30 days by termination notice due to redundancy, then employees dismissed in the same period by termination agreement are included in these thresholds.

In addition to the process above, collective dismissal must be:

• consulted with unions 30 days in advance, or notified to each affected employee if there are no active unions at the employer; and
• notified to the local Labour Office: (i) in advance, including information on commencement of the consultation process with unions; and (ii) on its result once it’s completed, in the form of a written report that must be delivered in copy to unions, which then have the right to comment on it – employment relationships can terminate only after the lapse of 30 days following this.

Yes; an obligation to consult the works council on a collective dismissal is triggered if two or more potential dismissals on economic grounds are planned. See question 6.

Individual dismissal meetings are still needed (see question 2) after the works council consultation process completes if no more than nine dismissals are expected.

Yes, the employer must consult any termination notice in advance. Agreement doesn’t have to be reached (with the exception of employees with enhanced protection; see question 11). In practice, the consultation is more of an announcement.

In case of collective dismissal, consultation must take place, and the employer must try to reach an agreement and inform the Labour Office of the result.

Yes, works council consultation is required. This involves submitting a written dossier to the works council containing all relevant information about the proposed reorganisation and dismissals. Consultation needs to be conducted in good faith to obtain the works council’s opinion on the project, but there is no need for the works council’s agreement.

If at least 10 dismissals are planned within 30 days in a company with a headcount of at least 50, “social plan” or “PSE” (plan de sauvegarde de l’emploi, a document describing the measures that the company will adopt to try to avoid dismissals and minimise the impact on affected employees) obligations apply: the works council consultation obligations are more extensive, and the company has to apply for ratification of the proposed dismissals by the labour authorities once the works council process is finished. The employer can negotiate with trade union representatives to sign a collective agreement on the contents of the PSE, the details of the works council consultation procedure and the dismissal implementation plan. If a collective agreement covering all of these subjects is signed, it is then easier to obtain ratification from the labour authorities (because the scope of their review is more limited).

It is the employer’s right to make an organisational change and its factual validity cannot be challenged. However, the individual dismissals may be challenged by employees. If successful (ie, the employer doesn’t prove redundancy), the restructure in the individual case may be prevented.

In the case of collective dismissals, it may be delayed by the unions prolonging the consultation. However, even then the unions and the Labour Office can’t prevent the dismissal, and the only way to prevent individual dismissal is a successful individual challenge by the dismissed employee.

If the unions believe that the collective agreement was violated by the redundancy or in the process of its implementation, they may dispute this violation. The dispute may be resolved by a mediator or escalated to an arbitrator. However, this doesn’t prevent the employer from executing the dismissals or restructure (only if violation is later found, it may have certain implications based on the individual collective agreement and nature of its violation).

For a large collective dismissal (at least 10 dismissals planned within 30 days in a company with a headcount of at least 50), the employer cannot implement the dismissals if it fails to obtain ratification from the labour authorities.

In case of individual dismissal, the consultation process is, rather, a notification (with the exception of employees with enhanced protection; see question 11) including:

• the identity of the employee;
• termination grounds (redundancy); and
• basic details of the redundancy (why and when).

It should take place prior to the dismissal (no specific deadline is given).

In case of collective dismissal, the consultation process includes:

• measures preventing or limiting the collective dismissal;
• mitigation measures (eg, employing the redundant employee at other workplaces of the employer);
• reasons;
• number and professions of redundant employees;
• number and professions of all the employees;
• the period during which the collective dismissal takes place;
• selection method of redundant employees; and
• severance pay and other rights of the redundant employees.

The consultation process must take place no later than 30 days prior to the collective dismissal. The local Labour Office must be notified as well (see question 3).

The administrative fine for violation of the consultation process with unions is up to 200,000 koruna. Employees who suffer damage as a result may claim compensation.

The process involves:

• providing the works council with written information including the following:
  • an economic rationale for proposed dismissals;
  • the maximum number of dismissals;
  • the professional categories affected;
  • the number of employees working at the establishment;
  • the proposed method of selecting employees (if need be);
  • the proposed timing for the dismissals;
  • any economic measures planned; and
  • the consequences of the dismissals for employees’ health, safety and working conditions.

More detailed information is required if social plan thresholds are exceeded; and

• consulting the works council. This normally involves two or more works council meetings. The maximum period for consultation on fewer than 10 dismissals is one month. For a large collective dismissal (at least 10 dismissals in a company with a headcount of at least 50), consultation is normally limited to two months (or three months if 100-249 dismissals are planned; or four months if at least 250 dismissals are planned).

There may be further consultation obligations under a company-level collective agreement with trade union representatives or the works council. The applicable national collective bargaining agreement (CBA) should also be checked for any provisions relating to economic dismissals.

Failure to consult the works council properly can lead to a fine of up to 18,750 euro multiplied by the number of employees affected (and they can claim damages).

Yes, an economic business rationale should be the reason for organisational change, and therefore the redundancy, and as such should be part of the consultation.

Yes, see question 1. The economic rationale can be challenged by dismissed employees to claim damages for unfair dismissal. On a large collective dismissal, it can be challenged by employee representatives to ask the labour authorities not to ratify the proposed dismissals (or to try to get their ratification decision annulled).

In case of collective dismissals, if there are no unions or employee representatives, the employer must inform and directly consult the affected employees to the same extent.

In case of individual dismissal, it is not a requirement, nor best practice, and highly depends on the strategy in the individual case.

If there are redeployment opportunities within the group, it is good practice to meet the “at risk” employees individually to discuss whether a new role can be identified to avoid dismissal.

Formal pre-dismissal meetings are only required if no more than nine dismissals are planned.

The only rule is that the employee’s position or work must be genuinely redundant (see question 1). If more than one employee fulfils this condition, it is up to the employer which employee to select. However, this choice must not indicate that there are in fact different motives for the redundancy of the selected employee (eg, disputes with the employer, unsatisfactory performance, or gender or other discriminatory motives).

Unless an applicable collective agreement provides for different selection criteria, the employer should simply ensure that it takes into account all four of the statutory criteria (length of service, number of dependents, social characteristics making it harder to find work (age, disability) and professional qualities).

The criteria should be applied consistently, and supported with evidence (such as past performance appraisals) where possible.

Yes, a termination notice due to redundancy is not allowed during the period for which an employee is:

• declared temporarily medically unfit for work or in institutional treatment (unless the employee has intentionally caused this unfitness, or it is a direct consequence of the employee’s alcohol intoxication or substance abuse);
• deployed in military exercises or military service;
• on long-term full leave to act in public office;
• pregnant, or on maternity leave, paternity leave, or parental leave;
• declared temporarily unfit for night work if they perform night work; or
• on leave caring for a child under 10 years of age, treating a child under 10 years of age or other natural persons, or providing long-term care, all as specified in the Czech Sickness Insurance Act.

No, but see question 11.

Yes, members of a trade union body during their term of office and for a period of one year after the end of their term of office. The employer must have prior consent of the unions for termination of their employment relationship by a notice. Consent is deemed to be given if the unions don’t respond within 15 days. Consent is valid for two months. Termination notice without such consent is invalid unless the court decides in the validity case that the employer could not have been justifiably required to keep the employee.

An employee on maternity leave cannot be dismissed during that leave or in the first ten weeks following her return to work.

Employee representatives are “protected” in the sense that before they can be dismissed, the employer must hold an individual pre-dismissal meeting, conduct a specific consultation meeting with the works council and obtain express authorisation from the labour inspector for the dismissal. Similar protection applies after the expiry of an employee representative’s mandate (for six or 12 months, depending upon the type of mandate). Prospective and recent candidates in works council elections are also protected.

An employee who is on sick leave due to a work-related accident or illness cannot normally be dismissed on economic grounds.

Employees cannot be selected for economic dismissal on discriminatory grounds (e.g. based on their race or gender, or their role in relevant health and safety or trade union activities), or by way of retaliation (e.g. whistle-blowers).

A redundant employee is entitled to a statutory severance payment, regardless of whether the employment termination is made by notice or agreement and if the redundancy is explicitly stated as the reason for the termination.

The severance payment is due on the next scheduled pay date following the termination of employment. A later due date can be agreed.

Yes; an employee who is made redundant is entitled to:

• a dismissal payment (if they have at least eight months’ service), calculated using the formula set out in the labour code or, if more generous, the applicable collective bargaining agreement (CBA);
• full pay and benefits for the duration of the applicable notice period (normally two or three months, depending on the applicable CBA and the employee’s status);
• pay in lieu of untaken holiday and rest days; and
• if the employee accepts the redeployment leave programme: payment of an allowance equal to at least 65% of his or her previous average total gross monthly pay (subject to a cap for high earners) for the duration of this programme following the end of the normal notice period.

There is no general requirement for payment into a central fund. However, if the employee accepts the CSP programme, there is no notice period; instead, the employer has to pay an amount equal to the salary that would have been due in respect of the notice period (up to a maximum of three months) plus social charges to the French unemployment authorities, which pay the former employee enhanced unemployment benefits for up to 12 months.

Upon the termination of employment, the company must provide continued cover (without cost to the employee) under its healthcare and life/incapacity insurance plans for up to 12 months, until the employee finds a new job.

The severance payment amount differs based on the length of the employment as follows:

• one gross average monthly salary of the employee if the employment lasted less than one year;
• two gross average monthly salaries of the employee if the employment lasted at least one year but less than two years; and
• three gross average monthly salaries of the employee if the employment lasted at least two years.

If the working hours account applies (specific working hours distribution scheme under the Czech Labour Code) the statutory severance is the relevant amount above plus three gross average monthly salaries of the employee.

The severance payment may also be higher if stated so by:

• agreement between the parties;
• the employer’s internal regulations; or
• a collective bargaining agreement.

A gross average monthly salary of the employee must be calculated for each employee separately using the specific rules of the Labour Code.

Yes, employees with at least eight months’ service are entitled to a dismissal payment. The minimum formula under the labour code is:

• 0.25 of a month’s average total pay (including variable pay) per year of service for the first ten years; and
• 0.3 of a month’s average total pay (including variable pay) per year of service for the period of service after the first ten years.

A more generous formula may apply under the relevant CBA.

Not in cases of individual dismissals.

In cases of collective dismissals, the employer must notify the relevant branch of the Labour Office:

• of the intention to carry out collective dismissal;
• that the consultation process has been initiated with the unions or the employees; and
• of the specific aspects of the collective dismissal, to the same extent as the unions (see question 6).

Following the consultation, the employer must deliver a written report to the Labour Office stating:

• that the employer has decided on collective redundancies;
• the outcome of the consultation process;
• the number and occupational composition of all employees; and
• the number and occupational composition of the employees to be made redundant.

A copy of the report must be delivered to the unions, which then have the right to comment on it.

For a reorganisation involving at least ten potential dismissals in a company with at least 50 employees, the employer must provide certain details of the project to the labour authorities as soon as the first works council consultation meeting has been held. The information required includes: company name and address, type of business activity, headcount, number of dismissals expected, whether the works council has appointed an expert to advise it, and whether a collective agreement regarding the dismissal project has been signed.

The employer must update the labour authorities throughout the consultation phase, and send them minutes of works council meetings and copies of the consultation documents whenever they are amended.

After the consultation phase, the company must submit a written request to the labour authorities for ratification of the proposed dismissals.

Transmission of information and documents to the labour authorities as summarised above is done online, using a dedicated website known as “RUPCO”.

No, generally there is no such obligation. If the conditions for dismissal due to redundancy are met, the employer is not obliged to offer the employee an alternative solution.

However, in some specific individual cases, the courts have concluded that if the employer still needs the work on part-time basis, the employer should first offer the employee this part-time job.

Yes, the employing entity must check for suitable vacancies throughout the group in France, and make precise individual job offers accordingly (or instead circulate a list of vacancies and regularly update it). Various details of each available position must be provided to “at-risk” employees.

There are no specific notification obligations after making the redundancies. Only general notification obligations, which are the same for all employment terminations, apply.

These general notifications must be made within eight days, using the relevant forms, to: (i) the employee’s health insurance company; and (ii) the District Social Security Administration (including the pension insurance record sheet).

If wage deductions were made to satisfy the employee’s debt to a third party, the employer must notify the relevant court (or tax authority case of tax debt), including an account of the deductions.

For a collective redundancy expected to involve no more than nine dismissals, the employer must send various details to the labour authorities (known as the DREETS) within eight days after the notice of dismissal: company name and address; type of business activity; headcount; name and address of the employee plus date of birth; gender; job title or classification; and date of notice of dismissal.

As for any termination of employment, the employer must send an online attestation to the unemployment authorities, providing details of the employee’s payroll history, to allow the unemployment authorities to determine that employee’s rights to benefits.

Details of any termination payments must be provided to the social security authorities (URSSAF) as part of monthly online declarations carried out by the employer’s payroll department or provider.

An employee may challenge the validity of a dismissal for redundancy if they consider that the statutory conditions were not met. First, the employee who wishes to remain employed must inform the employer without undue delay after the termination notice that they insist on continuing their employment. Second, the employee must file a lawsuit at the district court of the employer’s seat (residence or registered address). The lawsuit must be made within two months from the date on which the employment should have ended. After the two months, the right to file the lawsuit expires.

If the dismissal for redundancy is found invalid, the employee who wishes to remain employed remains to be employed at the original position under the original conditions and is entitled to a full compensation of salary for the whole time from the invalid termination until work is assigned again, or until the employment is validly terminated (ie, including the time of the court proceedings). The court may reduce the amount of such compensation if, for example, the employee has found another job in the interim, or could have found one.

There’s no statutory authorisation for unions to raise any claims at the court on behalf of employees except for insolvency proceedings (see question 21). However, only attorneys at law can represent employees fully and without limits in any proceedings. Another natural person can be granted a power of attorney in a specific case (not repeatedly). Theoretically, this could be a member or employee of the unions, but this is not a market standard.

Yes, an employee could claim damages for unfair dismissal in the French labour court (e.g. by arguing that the grounds were not valid or that the company breached its redeployment obligations). Damages for unfair dismissal are normally subject to a statutory cap of approximately one month’s pay per year of service, but French courts sometimes disregard the cap. A claim for an irregular dismissal procedure is also possible (but normally no further damages for this can be awarded if the unfair dismissal claim is upheld).

Employee representatives can bring a claim to the administrative tribunal for annulment of the decision by the labour authorities to ratify the proposed dismissals.

Yes, it is very common and highly recommended to terminate the employment by mutual agreement when making employees redundant. The termination agreement does not have to state any reasons for termination. However, should the reason be redundancy of the employee, the employee is entitled to statutory severance payment regardless. To motivate the employees to conclude the termination agreement, it is a market standard to offer a higher severance package than the statutory severance payment.

It is fairly common, but not completely standard. The signature of a settlement agreement does not replace the need to carry out the required works council consultation and individual dismissal procedures.

Individual redundancies generally take around two to three months. The organisational change must be prepared, and the termination agreement negotiated or the termination notice given. In case of the notice, the statutory notice period is two months. There’s no statutory notice period requirement in case of agreement, therefore it can be faster. It can also take longer (eg, more complicated cases, restructuring, C-level or other higher managers).

For collective redundancies, the process takes several months (at least three) due to higher demands on preparation, more complicated structuring, the consultation process, and the notification obligation to the Labour Office.

An individual redundancy typically takes four to six weeks, but depends on individual circumstances (including whether there are any redeployment opportunities to be offered).

A collective redundancy typically takes two to five months, depending on the project.

The above timelines describe the duration from the date on which the first formal procedural step is taken until the point at which notice of dismissal is issued. Further time should be allowed in advance to prepare the economic rationale and works council documentation, as applicable.

The statutory law does not expressly prohibit certain conduct. However, a redundancy means that the employee’s work is no longer needed and therefore any hiring (internal or external) for the same (or largely the same) position should be avoided (or at least thoroughly considered), especially for the two-month period during which the employee can challenge the validity of the dismissal.

Dismissed employees have a rehiring priority for 12 months after their exit date; the company only has to offer them suitable vacancies if they tell the employer that they wish to exercise this priority right.

During the six months following a collective dismissal, the employer is not allowed to hire staff for more than three months under a fixed-term contract or through a temporary work agency on the grounds of a temporary increase in workload. This restriction only applies to the hiring of staff to occupy positions that were affected by the collective dismissal.

The term “restructuring” in Czech law means one of the ways of resolving a company’s bankruptcy in insolvency proceedings. During this process, organisational changes including redundancies may occur. This kind of restructuring does not require unions’ consent; however, consultation may be required. Further, unions may represent the employees in insolvency proceedings.

In Czech law, “restructuring” within the meaning of a business transaction or corporate transformation or changes (i.e. not a type of insolvency proceeding) can also lead to transfer of rights and obligations from the employment relationship to another employer (transfer of undertakings), ie, the employee and their employment will be transferred to a new employer as a result of such transaction. In this case, the employer must inform the unions or other representatives (and if there are none, then the individual employees) and consult at least 30 days in advance:

• the effective date of the transfer;
• reasons for the transfer;
• legal, economic, and social consequences of the transfer for the employees; and
• measures to be taken in relation to the employees.

In case of cross-border mergers or spin-offs, the employer also must: (i) inform the employees or unions of their right to get acquainted with the written merger or spin-off project and give written comments on it; and (ii) generally reach agreement with unions regarding the extent and manner of the right of influence of the employees of the successor corporation (for example, in certain cases by electing a certain number of members of supervisory board in a joint stock company) if the seat of the newly formed entity is supposed to be in the Czechia. Further corporate obligations depend on the form of such restructuring.

However, the described labour law obligations don’t apply in the case of mere ownership change of the employer’s company where this has no direct legal implications for the employees (ie, it isn’t a transfer of undertaking or a termination reason).

A works council consultation must generally be completed before any decision to proceed with such a transaction is taken (ie, before the signature of binding transaction documentation). However, the transaction structure must be examined on a case-by-case basis to check whether a consultation is required.

Before the sale of a majority shareholding in a small or medium enterprise with fewer than 250 employees (or the sale of part or all of its business), there is an obligation to inform employees that they have the right to make an offer to buy the business (depending upon certain financial thresholds). There is no requirement to accept any such offer.

In general, employees have limited ability to influence the process of business transactions. The consultation process (see question 21) doesn’t have to result in an agreement with or of the unions. The administrative fine for violation of the consultation process is up to 200,000 Czech Koruna. If there are no unions and the employer breaches its information obligation towards the individual employees (see question 21), the law provides no administrative penalty. In each case, the employee could claim compensation for damage if any damage occurred.

The works council can go to court to ask a judge for an injunction prohibiting the transfer of shares in a French company or the sale of its business as a going concern until consultation obligations have been met. The employer could be ordered to pay a daily penalty to the works council or unions until it complies.

If employees bring a court claim for damages for failure to inform them that they can make an offer to buy the business, a fine of up to 2% of the sale price can be imposed at the request of the public ministry.

If the statutory conditions for transfer are met, the transfer occurs automatically, ie, neither the original employer, the new employer, the employees, nor the unions can avoid the transfer. An employee may prevent their own transfer only by serving termination notice to the employer before the transfer’s effective date, in which case the employment terminates on the day immediately preceding the transfer’s effective date at the latest. If the employer didn’t inform employee at least 30 days in advance (see question 21), the employee may serve their termination notice within two months after the transfer’s effective date – in which case, only a 15-day notice period applies.

Individual rights and obligations are transferred in full to the new employer. The rights and obligations under the original employer’s collective agreement are also transferred to the new employer, but only for the duration of the collective agreement, and for no longer than to the end of the following calendar year.

Transfer itself is not a statutory reason for terminating the employment. However, a restructuring (organisation change) leading to redundancy may happen before, during, or following the transfer. In such a case, the employee has the same rights as in the case of other redundancies.

If the employee terminates the employment by a notice or by an agreement within two months of the effective date of the transfer, they may raise a claim at court that the reason for termination was a substantial deterioration in working conditions caused by the transfer. If the court confirms it, the employee will be entitled to statutory severance (see question 13).

Yes; employees assigned to the business automatically transfer if there is a transfer of an autonomous economic entity that retains its identity, provided that its business activity continues or is resumed after the transfer. They are protected against dismissal for any reason connected with the transfer, both before and after it.

Since the transfer of rights and obligations under employment law occurs automatically, it is generally sufficient to follow the legally prescribed procedure for a given business transfer. In addition, it is necessary to comply with the information and consultation obligation (see question 21). Further, general reporting and notification obligations to the state authorities apply.

The works council should be consulted on the proposed transaction, provided the employing entity had at least 50 employees when the works council was elected (or if the headcount has since reached that level). To launch the consultation, written information must be provided to the works council on the following points:

• the fact that there is a proposed transfer, the intended date when it is to take place and the reasons for it;
• details of the buyer or transferee and its plans for the business;
• the legal, economic and social implications of the transfer for the affected employees. This would include any proposed changes to terms and benefits or working arrangements (such as the nature of the work done and location). This could entail changes both for transferring employees and for those left behind; and
• measures envisaged by the transferee or indeed the transferor. This might include any redundancies after the date of the transfer, or changes to collective benefits.

After one or more works council meetings, the employer should obtain the council’s opinion on the project. If the council persists in refusing to give an opinion, it is deemed to have done so one month after consultation. This is extended to two months if the works council appoints an expert, or three months if there is a two-tier employee representation structure (central works council and two or more establishment-level works councils) and experts are appointed at both levels. Different consultation periods may apply if there is a company-level collective agreement to that effect.

The working conditions of the transferred employees cannot substantially worsen. If this were to happen and the employee gave termination notice within two months of the transfer, the employee could claim statutory severance (see question 23).

In addition, the employer must comply with the general principle of equal treatment and ensure equal treatment of both the original and new employees in terms of their working conditions, remuneration, and other benefits, training, and the possibility of promotion.

Benefits applicable to the transferring employer according to a collective agreement have to be maintained by the transferee concerning the transferred employees for up to 15 months post-transfer, pending negotiation of harmonised arrangements. For other collective benefits (resulting from a unilateral commitment by the transferor or a binding practice), the transferee can change them subject to giving sufficient written notice (typically three months) to the employees and employee representatives.

If the hours, pay, or benefits are agreed in the employment or other contract, then no unilateral change can be made.

Working hours – either statutory weekly working hours apply (40 hours per week) or shorter working hours are agreed. In either case, the employer determines the distribution unilaterally (subject to complying with statutory rules and limits) unless agreed differently.

Salary – if it isn’t agreed in the employment or other contract, the employer unilaterally determines the salary by an internal regulation or by a salary statement.

Benefits – if they aren’t agreed in the employment or other contract, the employer unilaterally determines the benefits by an internal regulation or by a salary statement.

Hours and pay generally cannot be reduced without employee agreement. For other benefits, the nature and legal source of the benefit would need to be checked; generally, collective benefits can be changed provided that due notice is given to employee representatives and staff.

As for employment terms and conditions in general, if these have been agreed in the employment or other contract, they can be changed only by agreement. Validity of express contractual provision to vary the conditions depends on its structure and which conditions it concerns, and therefore there’s no generally applicable answer to the question.

The Labour Code further allows, in certain cases, a change in type of work, workplace, or employer by a temporary transfer of an employee to a different work position, workplace, or employer. Generally, consent is required; however, in certain cases, the employer can (and in very specific cases, has to) make a temporary transfer unilaterally (for example, if the employee is medically unfit to perform the agreed type of work, or to avert imminent danger). The employer must adhere to strict statutory conditions.

No, particularly if the change relates to a key term of employment such as remuneration or hours of work.

A “mobility clause” under which the employer can require an employee to move to a different place of work is potentially valid, but French courts interpret such clauses restrictively. The geographic scope of the clause must be precisely defined (rather than capable of being extended unilaterally by the employer), and the employer’s right to change the place of work may only be invoked in good faith. The judge must also check that the change of workplace would not have a disproportionate impact on the employee’s right to a private or family life.

Yes, the employee and the employer may agree on certain changes and variations implicitly. However, it is recommended to avoid such situations.

No.

If agreement is required to vary an employment term or condition, then the only option to vary it is an agreement.

In principle, the only options are to dismiss employees on economic grounds (which is likely to lead to successful unfair dismissal claims) or abandon the proposed variation.

It may make sense to offer an incentive (e.g. a one-off payment) to encourage employees to agree.

If varied unilaterally in a case where agreement was required, the employee may challenge the variation (depending on the situation, by demanding the employer to: refrain from such conduct, restore the original terms, or compensate the employee for the damage caused by such conduct). Depending on the situation there could also be a risk of administrative penalties.

Employees could:

• file a court claim for judicial termination of the employment contract, in which case they remain in service until the court makes its decision but could then be awarded damages for unfair dismissal, plus a dismissal payment and notice pay;
• walk out and claim constructive dismissal, if the change is a fundamental one (i.e. if the breach of contract goes to the root of the contract); or
• remain in post and simply claim compensation for the relevant breach of contract.

The Czech parliament is currently debating several changes in the area of labour law. However, none of the currently debated changes should affect the answers above.

A cap on damages for unfair dismissal (expressed as a number of months’ pay according to length of service) was introduced in France in 2017. The validity of the cap has been challenged repeatedly in French courts, in particular by arguing that it is contrary to certain international treaties to which France is a party.

The French judicial Supreme Court has consistently upheld the validity of the cap, but some lower courts continue to make higher awards of damages on occasion. Usually the rationale for such awards is that applying the cap would prevent the court from granting adequate compensation for unfair dismissal.