Dismissal of managers in France: the complete guide by a lawyer

Dismissing an executive is never a trivial act. Whether it is a middle frame, of a upper frame Or of a executive, the termination of the employment contract in this category of employees raises legal, financial and strategic questions that neither the employer nor the employee can afford to overlook.

In France, managers represent approximately 20% of the employed population, but their weight in labor litigation is disproportionate: the financial issues involved, the complexity of variable remuneration, the frequent existence of specific contractual clauses (non-competition, Golden parachute, Stock options) make each situation unique.

Whether you are manager wishing to end the contract of a key collaborator, or Executive confronted with the announcement of your own dismissal, this guide is intended to provide you with a complete vision of the applicable rules, the pitfalls to avoid and the levers to activate. There you will find concrete examples, of summary tables And answers to the most frequently asked questions on the subject.

What is a framework in the sense of employment law?

Before examining the rules of dismissal, it is essential to understand the different categories of frames recognized by French law. This distinction is not purely theoretical: it directly conditions the legal regime applicable in the event of breach of contract.

The “classical” framework: definition and general regime

The status of executive is not defined by the Labor Code independently. It mainly results from the applicable collective agreement And of the Occupational classification retained by the company. An employee is considered to be an executive when he performs functions involving a Level of responsibility, ofautonomy And of qualification higher than that of employees and supervisors.

Concrete example: A marketing director in a cosmetics company, ranked at the 170 coefficient of the Syntec Convention, is an executive. He benefits from a fixed number of days, a notice period of 3 months and a severance pay calculated according to the conventional scales specific to engineers and managers.

In terms of dismissal, the “classical” framework falls under Common law of dismissal : the employer must prove a real and serious cause, respect the legal procedure (prior interview, notification by registered letter, compliance with the notice period) and pay benefits due.

The executive officer: a status in its own right

The executive occupies a unique place in French labor law. Its definition is set by theArticle L. 3111-2 of the Labor Code, who poses three cumulative criteria :

• Of responsibilities involving a great deal of independence in organizing his schedule;
• Entitlement to make decisions largely independently ;
• One remuneration at the highest levels remuneration systems used in the company.

To these three legal criteria, the Court of Cassation added an additional condition: the executive officer must participate effectively in the management of the company. This case-law criterion is decisive. An employee whose contract mentions the status of executive officer, but who, in fact, receives precise instructions and reports frequently to his hierarchy, may challenge this qualification before the Labor Court.

Concrete example: A human resources director who must systematically submit his decisions to the director general and who cannot sign dismissal letters without prior validation does not meet the criteria of a senior executive, even if his contract would qualify him that way. The Court of Cassation specified this point in a judgment of 15 March 2023.

Executive manager: advantages and disadvantages of status

The status of executive officer has specific characteristics that can be perceived as advantages or disadvantages depending on the perspective adopted.

On the benefits side: the executive officer has a total freedom in the organization of working time. It is not subject to the legal hours of work, nor to the rules relating to overtime, daily and weekly rest, public holidays or on-call payments. His level of remuneration is generally very high and may include substantial variable components (bonuses, Stock options, free shares).

On the downside: this freedom comes at a price. The executive officer may not claim any overtime, any compensatory rest, or on-call compensation. In case of excessive workload, he does not benefit from the protections offered by the regulations on working time. Moreover, if one's status is contested, the financial consequences for the employer can be considerable (salary reminders over three years for overtime).

Executive and minimum wage: what remuneration?

There is no legal minimum wage specific to the management executive. The Labor Code simply requires that his remuneration be among the highest in the company. In practice, the remuneration of a senior executive often exceeds 100,000 euros per year gross, but this amount varies considerably depending on the size of the company, the sector of activity and the applicable collective agreement.

Appreciation is made on a case-by-case basis, in comparison with the remuneration actually paid in the company or establishment concerned. An executive receiving 70,000 euros gross annually in an SME with 30 employees where the average salary is 35,000 euros may be qualified as a management executive if the other criteria are met.

How do you fire an executive employee? The procedure step by step

The dismissal of a manager is subject to same procedural rules than that of any employee, with some particularities related to the status. Here are the steps to be followed carefully.

The invitation to the preliminary interview

The employer must send the manager a letter inviting you to a preliminary interview, sent by registered letter with acknowledgement of receipt or delivered by hand against discharge. This letter should mention thePurpose of the interview (without necessarily detailing the grievances), the Date, time and location of the maintenance, as well as the Possibility for the employee to be assisted by a colleague or, in the absence of staff representatives, by an external adviser registered on the prefectural list.

One minimum delay of 5 working days must separate the receipt of the summons and the holding of the interview. This deadline is a matter of public order and its non-compliance constitutes a procedural irregularity likely to give rise to compensation.

The conduct of the preliminary interview

The preliminary interview is a moment of exchange during which the employer Expose the reasons of the envisaged decision and Collect the explanations of the employee. This is not a simple formality: the employer must genuinely listen to the arguments of the manager before making a decision.

Practical advice for managers: Carefully prepare for this interview. Gather the factual elements that support the reason for dismissal (poor results, disciplinary misconduct, reorganization). Avoid vague or subjective formulations that would later weaken the dismissal letter.

Practical advice for the frame: Don't show up alone. Get assistance from a staff representative or advisor. Take detailed notes. This interview is your first chance to tell your side of the story.

Notification of dismissal

After the interview, the employer must respect a cooling-off period before sending the dismissal letter:

• Minimum 2 working days after the interview for dismissal for personal reasons;
• Minimum 7 working days (or 15 working days for a frame) after the interview for an individual economic dismissal.

The dismissal letter should accurately state the (s) Reasons for breakup. It sets the limits of the dispute: in the event of litigation, the judge will only be able to examine the reasons mentioned in this letter. An insufficiently motivated letter exposes the employer to reclassifying the dismissal as a dismissal without real and serious cause.

Notice of dismissal of an executive: what periods should be respected?

Framework notice of dismissal: the general rules

The duration of notice of dismissal of an executive is determined by the applicable collective agreement, the employment contract or, failing that, by the usages in force in the profession. Generally, the notice period for an executive is 3 months.

During the notice period, the manager continues to receive his remuneration and to work normally. Most collective agreements provide for a right of absence for job search : for example, the Syntec agreement grants 6 working days per month paid absence to search for work in the event of dismissal.

Executive dismissal notice: the specificities

For the executive, the notice of dismissal is often longer than that of the classic frame. It can reach 6 months, or even more, depending on contractual or conventional stipulations.

The former collective agreement for metallurgical engineers and managers provided, for example, for a notice of 6 months for managers aged 55 and over. The new national collective agreement for metallurgy (IDCC 3248), which came into force on 1 January 2024, has revised some of these provisions while maintaining transitional protection measures.

Exemption from notice and compensatory compensation

The employer can exempt the framework from executing one's notice. In this case, he must pay him a compensation in lieu of notice equal to the gross remuneration that he would have received if he had worked until the end of the notice period, Paid vacation pay included.

Concrete example: A sales manager receiving a gross salary of 8,000 euros per month, exempt from 3 months' notice, will receive a notice compensation of 24,000 euros gross, to which is added the corresponding compensation for paid leave (2,400 euros gross).

What is the severance pay for an executive?

The calculation of the legal redundancy compensation

THElegal redundancy compensation is the same for all employees, frames or not frames. The Labour Code makes no distinction. Its amount cannot be less than:

• 1/4 of a month's salary by year of seniority for First 10 years ;
• 1/3 of a month's salary By year of seniority beyond 10 years.

The reference salary selected is the most favorable between Average of the last 12 months And the Average of the last 3 months prior to the notification of the dismissal (in this second case, annual bonuses and bonuses are taken into account on a pro rata basis).

Concrete example: An executive with 15 years of seniority and a reference salary of 6,000 euros gross will receive a legal compensation of: (6,000 × 1/4 × 10) + (6,000 × 1/3 × 5) = 15,000 + 10,000 = 25,000 euros gross.

Conventional redundancy compensation: often more favorable

Many collective agreements provide for better redundancy benefits than the legal minimum, especially for managers. The employer must always compare the amount of the legal compensation and that of the conventional compensation, and pay the amount uppermost (the two do not combine).

Here is a comparative table of the main collective agreements:

The calculation of the severance pay in the metallurgical agreement

La Metallurgical collective agreement deserves special attention because of its complexity. Since the entry into force of the new national convention (IDCC 3248), the calculation of the redundancy benefit for managers (classified in employment groups F to I) has been based on a specific formula taking into account theseniority And of theage of the employee.

Conventional compensation may be Increased (for employees aged 55 to 59) or Minorée (for employees aged 60 and over), in both cases up to a ceiling of 18 months' salary. The most favorable amount between the conventional compensation and the legal compensation applies.

Concrete example: An executive engineer in metallurgy, aged 50, with 12 years of seniority and a reference salary of 5,200 euros gross monthly, will have his conventional compensation calculated according to the progressive formula of the agreement. If the result is 18,720 euros, and the legal compensation is 19,067 euros, the legal compensation — more favorable — will be paid to him.

Contractual benefits: parachute clause and Golden parachute

In addition to legal and contractual benefits, an executive employment contract may provide for contractual termination benefits much higher. This is particularly the case with the famous clause called” golden parachute ” (Golden parachute), frequently negotiated by senior managers when they are hired.

This clause provides for the payment of specific compensation in the event of dismissal (excluding serious or serious misconduct, unless otherwise stipulated), often calculated as a number of months of total remuneration. It can relate to very significant amounts: 6, 12, 18 months salary, or even more in large listed companies, subject to compliance with governance rules (approval by the general meeting pursuant to the Commercial Code for public limited companies).

Attention: the existence of a parachute clause does not exempt the employer from complying with the dismissal procedure. And the executive officer can perfectly combine the benefit of this contractual clause with the legal or conventional compensation for dismissal and, where appropriate, with damages for dismissal without real and serious cause.

Why are managers being fired? The most frequent reasons

Professional inadequacy and inadequate results

THEprofessional inadequacy is one of the most common reasons given for terminating an executive. It is different from fault in that it does not involve any intention to harm or even wilful negligence. It is the inability of the employee to perform the functions assigned to him in terms of his qualification, experience and the resources available to him.

For a commercial setting, this can result in a lack of results : objectives not achieved over several consecutive years. But the employer must be able to demonstrate that these goals were Realists, achievable, releases to the employee and that the latter had necessary resources to reach them.

Concrete example: A sales manager whose turnover has fallen by 30% over two consecutive years while the market is stable and his colleagues are achieving their goals presents a solid case of insufficient results. On the other hand, if the decrease is the result of an internal reorganization that deprived this director of his best salespeople, the reason will be fragile.

Serious fault or gross negligence

The dismissal for Serious misconduct deprives the executive of its right to notice and to compensation for dismissal (unless a more favourable contractual provision is made). The serious fault is the one that renders Impossible to keep the employee in the company, even during the notice period.

For a senior executive, the requirement threshold is often higher because of their responsibilities: embezzlement, serious breach of the duty of loyalty, stalking Proven, sexist or racist behavior are all faults that are likely to justify immediate dismissal.

La gross negligence Assume, in addition, theIntent to harm to the company. It is exceptionally retained and entitles the employer to seek damages from the employee.

The loss of trust and strategic discrepancy

For the executive officer, the loss of trust is a frequently cited reason. However, the loss of trust does not constitute in itself a reason for dismissal. It must be based on objective and verifiable elements : questionable strategic decisions, poor communication with management bodies, a documented managerial conflict.

In practice, the difference of opinion between the executive and the shareholders or the board of directors often leads to the preference of a Negotiated breakup rather than a contentious dismissal. Confidentiality and the preservation of the company's image are decisive considerations in this choice.

The economic dismissal of an executive

The economic dismissal also affects managers, including senior managers. It is justified by economic difficulties, of technological changes, a reorganization necessary to maintain competitiveness Or the cessation of activity of the company.

The economic dismissal procedure has notable particularities for managers: the Deadline for sending the dismissal letter Is of 15 working days after the preliminary interview (compared to 7 days for non-managers) in the context of an individual dismissal.

Dismissal of economic executive officer: what are the particularities?

The obligation to reclassify

Even when it comes to a manager, the employer is required to respect his Obligation to reclassify before proceeding with the economic dismissal. He must search for all available positions in the company and, if applicable, in the group to which it belongs, in France. Reclassification offers must be Written, Precise and personalized.

In practice, the possibilities of reclassifying a senior executive are often limited because of the uniqueness of its functions and its level of remuneration. But this difficulty does not exempt the employer from carrying out effective and documented research.

The Job Protection Plan (PSE) and the frameworks

When the business counts at least 50 employees and plans to lay off 10 employees or more over 30 days for economic reasons, it must set up a Job Protection Plan (WEIGHT). This plan includes measures for internal redeployment, training, assistance in setting up a business and supra-legal benefits.

Managers are eligible for PES measures under the same conditions as other employees. They can also benefit from a redeployment leave (in companies with 1,000 employees or more) or a professional security contract (CSP) in companies with less than 1,000 employees.

The criteria for the order of dismissals

In a collective economic dismissal, the employer must define criteria for the order of dismissals to determine which employees will be affected. These criteria take into account family expenses, theseniority, the difficulties in reintegrating into the workforce (especially related to age or disability) and professional qualities.

Managers are not exempt from these criteria, but their application can be a source of litigation: a 55-year-old senior manager, who is difficult to reclassify because of the specificity of his functions and his level of remuneration, should logically benefit from favourable treatment with regard to the criterion of professional reintegration.

How do you fire a senior manager or a senior executive?

The distinction between employment contract and social mandate

For managers who accumulate a employment contract And a social mandate (managing director, member of the management board, director), the breach of contract involves a double dimension.

La revocation of social mandate complies with the rules of company law: it falls under the competence of the competent corporate body (general meeting, board of directors, supervisory board) and may, in certain cases, intervene Ad Nutum (at any time, without reason or notice) for SA agents.

The dismissal from the employment contract for its part, complies with the rules of labor law. Both procedures are distinct and independent : the revocation of the social mandate does not automatically lead to the termination of the employment contract, and vice versa.

Concrete example: The managing director of a SAS, who is also the holder of an employment contract for separate technical functions (R&D management, for example), may be revoked from his social mandate by the sole partner while maintaining his employment contract. The employer will then have to initiate a separate dismissal procedure if he wishes to terminate the employment contract.

CEO dismissal: special case of the dismissal of the manager

The dismissal of the CEO (Chairman and CEO) of a public limited company is in reality a revocation pronounced by the board of directors. In SA with a board of directors, the CEO can be removed at any time by the board of directors, without the need to invoke a Just reason. However, if the revocation occurs in brutal or vexatious circumstances (absence of contradictory debate, surprise dismissal during a board of directors convened under a false pretext), the manager will be able to obtain damages for abusive revocation.

When the manager also has an employment contract corresponding to distinct and effective technical functions, the termination of this contract will fall under the jurisdiction of the Labor Court and the rules of dismissal. This is why it is essential to clearly distinguish, at the time of hiring, between functions under the social mandate and those covered by the employment contract.

The initial negotiation of an executive: conventional break or transaction?

The conventional break of the framework

La Conventional break is a method of amicable termination of an employment contract for an indefinite period. It is open to all employees, including managers and managers. It has the advantage of simplicity and legal security, subject to approval by DREETS.

However, for senior managers, the conventional break is rarely used in practice for two main reasons. First, the confidentiality : a contractual break is the subject of an administrative declaration and cannot be accompanied by a confidentiality clause as strict as a transaction. Then, the taxation : the 20% social security package applicable to the compensation for contractual termination weighs on the employer, who often prefers to use the transactional protocol.

The transaction memorandum of understanding

La transaction (articles 2044 et seq. of the Civil Code) is the preferred method of termination for senior managers. It allows you to freely set the amount of the severance pay, to provide for reciprocal commitments (obligation to not denigrate, internal and external communication, return of equipment, fate of Stock options and free shares) and to guarantee the confidentiality terms of the agreement.

The transaction assumes the existence of a real dispute between the parties and must include reciprocal concessions. It can only interveneafter notification of dismissal : a transaction signed before receiving the dismissal letter is void.

Strategic points of the negotiation for the framework:

• Evaluate the compensation base : integrate all elements of remuneration (fixed, variable, bonus, benefits in kind, Stock options, RSU, free shares);
• Negotiate the non-competition clause : obtain the lifting of the clause or, failing that, a significant compensatory compensation;
• Anticipating taxation : transactional benefits benefit from a tax and social exemption regime within certain limits (twice the annual gross remuneration, or 50% of the total compensation, within the limit of six times the annual Social Security ceiling, i.e. around 278,000 euros in 2025);
• Preserving your reputation : negotiating the terms of internal and external communication relating to departure;
• Check pension contributions : ensure the perfect payment of Agirc-Arrco contributions.

Executive and on-call: what rules apply?

The question ofSupervising executive is a recurring topic. As a matter of principle, managers, who are excluded from regulations on hours of work, does not benefit from the penalty payments regime provided for by the Labor Code (articles L. 3121-9 et seq.). He can therefore not claim either financial compensation or compensatory rest associated with penalty payments.

However, there are limits to this exclusion. The employer remains responsible for his safety obligation to the management executive. A clearly unreasonable workload, permanent demands without any rest time, may involve the employer's liability for the failure to maintain the employee's health.

Concrete example: A director of operations of a hotel group, qualified as a management executive, called upon 7 days a week and forced to intervene at any time without the possibility of delegation, may invoke a breach by the employer of its security obligation, even if he cannot claim the payment of penalties in the strict sense of the Labor Code.

In addition, if the employee succeeds in showing that he does not meet the criteria of a management executive (and that he is in fact an executive subject to the day package, for example), he will then be able to claim compensation for his on-call payments and the payment of his overtime over the last three years.

The Macron scale and the labor dispute of the dismissed executive

Labor benefits in the event of dismissal without real and serious cause

The benefits of amicable negotiation for the framework

In practice, the Macron scale has profoundly changed the litigation strategy of executives. For a high-paid executive with moderate seniority, the capping Labor benefits can make litigation less attractive than amicable negotiation well conducted. This is also the reason why the Macron scale is frequently used as reference in transactional negotiations, even without litigation.

The indispensable role of the lawyer in the dismissal of managers

The dismissal of an executive, especially a senior executive, is a eminently technical and regulated subject. The financial challenges are significant, the risks of litigation real, and the fiscal and social implications of termination benefits are particularly complex.

Whether you are an employer or an employee, the advice from a lawyer specialized in employment law are essential for:

• Anticipate risks related to the qualification of the reason for dismissal;
• Securing the procedure and avoid irregularities that may vitiate the dismissal;
• Optimizing benefits taking into account all parameters (legal, conventional, contractual, fiscal and social);
• Negotiate effectively the terms of a departure, while maintaining the interests of each party;
• Preventing litigation or, when they are unavoidable, prepare the strongest defense before the Labor Court.

Each situation is unique. The intervention of a lawyer early on makes it possible to identify points of strength and vulnerability, to define an appropriate strategy and to conduct the procedure with the rigor required in this area.

FAQ: the most frequently asked questions about the dismissal of managers

How do you fire an executive employee?

The dismissal of a manager employee follows the common law procedure: invitation to a preliminary interview (with a minimum delay of 5 working days), Conduct of the interview (during which the frame can be assisted), Notification of dismissal by registered letter with acknowledgement of receipt after a reflection period of at least 2 working days, and respect for the notice (generally 3 months for a manager). The employer must prove a real and serious cause and pay the most favorable redundancy compensation between legal, contractual and contractual compensation.

Why are managers being fired?

The reasons for the dismissal of managers are varied: professional inadequacy or results, disciplinary offense (breach of the duty of loyalty, violation of the duty of confidentiality, harassment), economic reason (restructuring, job cuts, financial difficulties of the company), inadequacy ascertained by the occupational physician, or strategic discrepancy with management. For managers, the loss of trust based on objective elements can also justify the break.

What is the severance pay for an executive?

The legal redundancy compensation for an executive is identical to that of any employee: 1/4 month's salary per year of service for the first 10 years, then 1/3 of a month beyond. However, the collective agreement may provide for more advantageous amounts. In addition to this legal or conventional compensation, there may be additional contractual benefits (parachute clause), a compensation in lieu of notice and, where appropriate, a transactional compensation negotiated as part of an initial protocol.

How do you fire a senior manager?

The dismissal of a senior manager follows the same rules as that of a traditional manager, but the stakes are higher. It is recommended to document the reasons precisely (with factual, dated and verifiable elements), of secure the dismissal letter by having it written or proofread by a lawyer, andanticipate the negotiation of a possible transactional departure. The non-competition clause, variable remuneration elements and benefits in kind must be treated with particular attention.

What is the notice of dismissal of a manager?

The notice of dismissal of a senior executive is generally of 3 to 6 months, according to the collective agreement and the provisions of the employment contract. Some agreements provide for an extension of the notice period according to age (for example, an additional month for employees aged 40 to 50, two additional months for those aged 50 to 60). The employer may exempt the executive officer from the execution of his notice, subject to the payment of a Compensatory allowance.

What is the economic dismissal of a manager?

The economic dismissal of a management executive follows the same principles as for any employee: he must be justified by characteristic economic difficulties, of technological changes, a reorganization necessary for competitiveness Or the cessation of activity. The employer must respect his Obligation to reclassify and, in companies with 50 employees and more laying off 10 or more employees, set up a PSE. The executive officer benefits from a cooling-off period of 15 working days between the preliminary interview and the sending of the dismissal letter.

How is the severance pay calculated in the advertising agreement?

Severance pay in collective advertising agreement (IDCC 86) varies according to the length of service and the professional category of the employee. It is appropriate to refer to the current conventional text to determine the exact formula applicable and to compare it with the legal compensation. The calculation must always include all contractual remuneration elements (fixed, variable, bonuses). In case of doubt, the use of a lawyer or a conventional simulator is strongly recommended.

Executive and on-call: what are my rights?

The executive officer is not not subject to the rules relating to on-call payments provided for in the Labour Code. He cannot therefore claim financial compensation or compensatory rest associated with penalty payments. However, the employer is still required to safety obligation : a permanent and unreasonable solicitation may result in liability. If the employee considers that he does not meet the conditions for executive management status, he can request one. requalification before the Labor Court and demand payment of penalties and overtime over the last three years.

How to simulate the calculation of the compensation for the dismissal of a non-executive in a metallurgy agreement?

The Termination pay calculation simulator available on the site of Digital Labor Code (code.trav.gouv.fr) allows you to obtain an estimate taking into account the applicable collective agreement. For the metallurgy agreement, you must fill in the entry date, the exit date, the date of notification of dismissal and the latest salaries. The simulator automatically compares the legal compensation and the conventional compensation and chooses the most favorable one. However, it is recommended that the calculation be checked by a legal professional to ensure that all remuneration components are taken into account.

Article written by Guillaume Leclerc, lawyer in Paris, 34 Avenue des Champs-Elysées