(Bloomberg) -- France's top court backed one of President Emmanuel Macron's most emblematic attempts to loosen the country's labor market, a controversial cap on unfair dismissal damage awards to workers.
The Cour de Cassation said Wednesday that the cap is in line with international law, and doesn't violate regulations set out by the International Labour Organization and the European Convention on Human Rights. The ruling may end months of uncertainty brought by decisions by several employment tribunals to disregard a cap he set on unfair dismissal awards to workers.
Macron's damages scale -- setting an upper and lower limit -- doesn't prevent workers fired unfairly from getting adequate compensation, the judges said. They also found that provisions in the European Social Charter aren't relevant after two employment tribunals, in Toulouse and in the northern France city of Louviers, requested their opinion.
Macron's very first economic reform when he took office two years ago was to overhaul the labor code in a bid to lower unemployment by turning the country into “a start-up nation” and making it more appealing to investors. The changes sought to limit awards by labor judges to about a month's pay for a year of service up to 10 years, and cap the maximum payout to 20 months.
The Cour de Cassation's opinion provides guidance to employment tribunals throughout France, some of which chose in the last few months to either uphold Macron's award limitation or ignore it in order to have more leeway to assess individual situations.
To contact the reporter on this story: Gaspard Sebag in Paris at gsebag@bloomberg.net
To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Christopher Elser
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