The French High Court (Cour de Cassation) recently clarified that the CEO of one company may dismiss an employee of another company in the same group

21 May 2024

In principle, the management of the company employing the employee concerned is responsible for carrying out the redundancy procedure.

However, the CEO may delegate this power to another employee of the company involved in human resources management (for example, the human resources director (Cass. Ch. Mixte 19.11.2010 No. 10-10.095) or the financial director (Cass. Soc. 18.11.2003 No. 01-43.608), but not a person from outside the company (Cass. Soc. 20.10.2021 No. 20-11.485).

Recent case law has defined more precisely the concept of “foreign person” in groups of companies and has accepted (Cass. Soc. 28.06.2021 No. 21-18.142) that a managing director of a parent company may, under certain conditions, dismiss an employee of a subsidiary whose activities he supervises (Cass. Soc. 13.06.2018 No. 16-23.701), as may the manager of another group company who has received a mandate from the CEO of the employer company to manage the subsidiary’s commercial operations and human resources (Cass. Soc. 28.06.2021 No. 21-18.142).

Nevertheless, the human resources director of a group subsidiary may not dismiss an employee of another group subsidiary unless he has management authority in that other subsidiary (Cass. Soc. 20.10.2021 No. 20-11.485).

Since the dismissal with irregular representation can be considered as an unjustified dismissal followed by important damage claims, it is advisable to carefully check the powers of representation before initiating a dismissal procedure in a subsidiary in France.