Cour de cassation Luxembourg – dismissal during secondment

The Luxembourg Court of Cassation overturned a judgment of the Court of Appeal relating to the interoperability between the Posting of Workers Directive and the Rome I Regulation (78/2022 of 19/05/2022- CAS-2021-00082 ).

Facts

Aged 62, the petitioner in cassation was hired by the Luxembourg branch of a French company, for an indefinite period (employment contract subject to Luxembourg law).

Seven months later, the employee is seconded to the French company, for an anticipated period of five years.

About two years after the start of the mission in France, the employer notified the employee of the automatic termination of employment, on the employee’s 65th birthday, in application of the Luxembourg Labor Code.

The employee appealed to the Luxembourg labor court, contesting the relevance of the Luxembourg labor code. The employee alleged that he was not temporarily seconded to the French company and that Luxembourg law should not apply to the dismissal.

In such circumstances, provided that:

  • the usual place of work within the meaning of Art 8.2 of the Rome I Regulation is deemed to be France, and
  • the provisions relating to the French labor code (more favorable to the employee) cannot be derogated from by agreement under French law, or constitute derogatory mandatory provisions (within the meaning of art 9 of the Rome I regulation)

termination under the Luxembourg Labor Code would be void.

The judgment of the Court of Appeal

The judgment of the Court of Appeal confirmed the position of the first instance (Labour Court) and declared the appeal unfounded.

The Court of Appeal admitted the existence of a posting in France (within the meaning of Directive 96/71/EC).

In accordance with the reasoning of the Court of Cassation, the judgment of the Court of Appeal must be interpreted as having considered the usual place of work (within the meaning of Art 8.2 Rome I Regulation) to be in Luxembourg.

The determination of the usual place of work stems from the existence of genuine posting within the meaning of Directive 96/71/EC.

The judgment of the Court of Cassation

The Court of Cassation overturned the first instance decision on the grounds that the Court of Appeal had not responded to the employee’s conclusions. The latter denies having been temporarily employed in France within the meaning of the second sentence of Article 8.2 of the Rome I Regulation.

Notes in the margin of the slipcase

In his conclusions (Court of Cassation), AG Kappweiler considered that “The existence (or non-existence) of a posting therefore has a crucial impact on the place of performance of the work. It would therefore be wrong to consider the usual place of performance of the work as the starting point of the analysis”.

The existence of a posting (within the meaning of Directive 96/71/EC) has an impact on the assessment of the file.

AG Kappweiler suggested that “The second sentence of paragraph 2 (“The country where the work is usually performed is not deemed to have changed if temporarily employed in another country.“) refers to the posting of an employee.

To justify this conclusion, AG Kappweiler referred to the opinion given by AG Bobek in the Van den Bosch Transporten BV case. AG Bobek underlined the need for consistency in the interpretation of Directive 96/71/EC and the Rome I Regulation with regard to the material link between the worker and a given Member State (opinion AG Bobek, 30 April 2020, Van den Bosch Transporten BV, C‑815/18, EU:C:2020:319, paragraph 92).

The second sentence of paragraph 2 (Article 8.2 of the Rome I Regulation) does not refer exclusively to posting situations. Moreover, the second sentence is subordinate to the first: it is necessary to first determine the country in which or, failing that, from which the employee usually performs his work in performance of the contract. This country is not deemed to have changed if the employee is temporarily employed in another country.

In accordance with Article 23 of the Rome I Regulation, this Regulation does not prejudge the application of (among others) Directive 96/71/EC.

It follows that it must first be ascertained whether the case falls within the scope of Directive 96/71/EC.

Provided that an effective posting is identified within the meaning of Article 4 of Directive 2014/67/EUthe conditions for entering into and terminating the employment contract are determined by the law applicable to the employment relationship (law determined in accordance with the Rome I Regulation).

The law applicable to the employment relationship is the law chosen by the parties (in this case Luxembourg law), supplemented by provisions which cannot be derogated from by agreement under the law which would have been applicable in the absence of choice. (if they are more favorable to the worker).

The law applicable in the absence of choice must be determined in accordance with Art. 8.2 to 8.4 of the Rome I Regulation. Priority must be given to art 8.2, the law of the country in which or, failing that, from which the employee usually performs his work in performance of the contract.

It follows that the law of the country where the work is usually carried out must be determined (within the meaning of art 8.2 Rome I Regulation).

Obviously, provided that after verification under Article 4 of Directive 2014/67/EU, the posting does not fall within the scope of Directive 96/71/EC, Article 8 of the Rome Regulation I must also be applied.

In both casesthe determination of the country in which or, failing that, from which the employee habitually performs his work in performance of the contract, should take into account the criteria arising from the relevant case law of the ECJ (such as the place of effective employment, the nature of the work, the elements which characterize the activity of the employee, the country in or from which the employee actually performs his tasks or the main part of his tasks, receives instructions concerning his tasks and organizes his work).

With regard to the quantitative criterion, reference should be made to the judgment of the CJEU in the Weber case (C-37/00) on the Brussels Convention:

“In the case of an employment contract under which an employee carries out the same activities for his employer in several Contracting States, it is necessary, in principle, to take into account the entire duration of the employment relationship in order to identify the place where the employee usually works, within the meaning of Article 5(1))” (27 February 2002, Herbert Weber, C-37/00, EU:C:2002:122, paragraph 58).

The display period does not represent in itself a decisive indicator (long-term posting is not limited in time). The question should be the proportionality between the duration of the posting and the period of employment actually carried out in the “home Member State”.

The other criteria must be assessed taking into account the facts of the case in question (the Belgian Court of Cassation recently annulled a judgment of the Brussels Labor Court relating to the application of Article 19 of Regulation 44/2001/ EC, in particular because only the quantitative criterion was considered – No. S.21.0038.F of May 16, 2022).

Taking into account all the relevant criteria, a natural person hired in Luxembourg (employment contract subject to the legislation of the latter country), having worked seven months in Luxembourg, then seconded for an anticipated period of five years in France, and finally made redundant after having worked for two years in the latter country, cannot necessarily be dismissed under Luxembourg law.

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