Calculating the Special Severance Pay for Work-Related Unfitness in France: Employer's Guide

When an employee is dismissed for work-related unfitness (inaptitude d’origine professionnelle — resulting from a workplace accident or occupational illness), they are entitled to enhanced compensation under Article L.1226-14 of the French Labour Code. But calculation errors are common: doubling the wrong indemnity, forgetting the comparison with the collective bargaining agreement, confusing the two amounts due… Here is the complete method for calculating correctly.

Table of severance indemnities for unfitness

The amount depends on the origin of the unfitness. An overview before going into detail:

Item	Non-occupational unfitness	Occupational unfitness (workplace accident/occupational illness)
Severance indemnity	Statutory indemnity (Art. L.1234-9), or the contractual (collective agreement) indemnity if more favourable	Special indemnity = double the statutory indemnity (Art. L.1226-14); the collective-agreement indemnity, however, is not doubled
Notice period	Not performed; no compensatory indemnity in lieu of notice, but the notice period is taken into account when calculating the severance indemnity (Art. L.1226-4)	An indemnity equal in amount to the compensatory indemnity in lieu of notice (Art. L.1226-14, referring to L.1234-5), due even where the notice is not performed
Legal basis	Art. L.1226-4	Art. L.1226-14

The remainder of this article details the calculation for occupational unfitness — the case most prone to errors.

What does Article L.1226-14 of the French Labour Code provide?

Article L.1226-14 provides that an employee dismissed for work-related unfitness is entitled to two distinct indemnities:

A termination indemnity equal in amount to the compensatory indemnity in lieu of notice (Article L.1234-5).
A special severance indemnity equal to double the statutory severance indemnity (Article L.1234-9), unless more favourable provisions of the collective agreement apply.

Here is the exact wording: “Termination of the employment contract in the cases provided for in the second paragraph of Article L.1226-12 entitles the employee to a compensatory indemnity equal in amount to the compensatory indemnity in lieu of notice provided for in Article L.1234-5, as well as to a special severance indemnity which, save for more favourable provisions of the collective agreement, is equal to double the indemnity provided for in Article L.1234-9.”

It is imperative to clearly distinguish these two amounts: they have different legal natures, different calculation bases and different social-security/tax regimes.

How to calculate the special severance indemnity?

Step 1: calculate the statutory severance indemnity (L.1234-9)

The statutory severance indemnity is calculated according to the following formula:

1/4 of a month’s salary per year of service for the first 10 years.
1/3 of a month’s salary per year of service beyond 10 years.

The reference salary is the more favourable of: the average of the last 12 months, or one-third of the last 3 months (including bonuses and gratuities on a pro-rata basis).

Step 2: double the statutory indemnity

Special indemnity = 2 × statutory indemnity.

This is the core of Article L.1226-14. Note: only the statutory indemnity is doubled. The indemnity provided for by the collective agreement is never doubled, unless the collective agreement expressly provides otherwise (Cass. soc., 25 March 2009, no. 07-41.708, Bull. V no. 83; 18 February 2015, no. 13-20.171; 20 November 2024, no. 23-14.949).

Step 3: compare with the collective-agreement indemnity

You must carry out a mandatory comparison:

A = 2 × statutory indemnity (special indemnity, L.1226-14).
B = collective-agreement severance indemnity (not doubled, calculated according to the scale of your collective agreement).

You pay the amount most favourable to the employee: max(A, B).

There is neither combination nor addition of the two: it is one or the other (Cass. soc., 10 May 2005, no. 03-44.313, Bull. V no. 153; 23 January 2013, no. 11-25.851).

Concrete calculation example

Situation: employee with 15 years of service, reference salary of €3,000 gross.

Calculation A — Special indemnity (double the statutory):

Statutory indemnity = (1/4 × 3,000 × 10) + (1/3 × 3,000 × 5) = 7,500 + 5,000 = €12,500
Special indemnity = 2 × 12,500 = €25,000 gross

Calculation B — Collective-agreement indemnity (example collective agreement):

Assume the agreement provides 1/3 of a month per year of service = 1/3 × 3,000 × 15 = €15,000

Comparison: A (€25,000) > B (€15,000) → payment of €25,000 gross (special indemnity).

If the agreement provided for an indemnity of €30,000: B (€30,000) > A (€25,000) → payment of €30,000 (collective-agreement indemnity, not doubled).

How to calculate the indemnity “equal in amount to the notice period”?

This is the second amount provided for by L.1226-14. Its amount is equal to that of the compensatory indemnity in lieu of notice (Article L.1234-5), but its legal nature is different. It is not a notice indemnity — it is a specific termination indemnity.

Calculation rules

The amount is determined by reference to the statutory notice period, not the contractual/collective-agreement period even if it is longer (Cass. soc., 12 July 1999, no. 97-43.641; 20 November 2024, no. 23-14.949).
The doubling of the notice period for disabled workers does not apply to this indemnity (Cass. soc., 10 March 2009, no. 08-42.249; 4 September 2019, no. 18-13.779).

Subject to social-security contributions (Cass. soc., 11 January 2017, no. 15-19.959).
Does not give rise to paid-leave entitlement (Cass. soc., 4 December 2001, no. 99-44.677; 30 April 2014, no. 12-28.374; 7 February 2024, no. 22-15.988).
Excluded from the base for the compensatory indemnity for paid leave (Cass. soc., 12 October 2011, no. 10-18.904).
Does not push back the contract end date: the contract ends on the date the dismissal is notified (Cass. soc., 15 June 1999, no. 97-15.328).
Combines with daily social-security benefits (IJSS).

Example

Managerial employee with a 2-month statutory notice period, salary of €3,000 gross → indemnity = €6,000 gross.

What wording should be used in payroll?

Terminological rigour is essential to avoid any subsequent dispute:

On the pay slip

For the special indemnity: “Special severance indemnity – Art. L.1226-14 (double the statutory – Art. L.1234-9)” OR “Collective-agreement severance indemnity (not doubled) – more favourable”.
For the indemnity equivalent to the notice period: “Termination indemnity – Art. L.1226-14 – amount equal to the compensatory indemnity in lieu of notice (Art. L.1234-5)”.

Absolutely to be avoided: any isolated use of “compensatory indemnity in lieu of notice” as a heading. This terminological confusion can generate ancillary claims (claims for paid leave on the notice period, postponement of the contract end date, etc.).

In the dismissal letter

Explicitly mention Articles L.1226-12 (2nd paragraph) and L.1226-14 as the bases for the indemnities paid, distinguishing the two amounts.

What are the most common mistakes to avoid?

Doubling the collective-agreement indemnity instead of the statutory one — a costly and legally unfounded error.
Adding together the special indemnity and the collective-agreement indemnity — it is one or the other (the more favourable).
Omitting the A vs B comparison — mandatory in all cases.
Confusing the indemnity “equal in amount to the notice period” with a genuine notice indemnity.
Calculating net instead of gross — the special indemnity is expressed in gross (Cass. soc., 7 May 2024, no. 22-21.479).
Using the collective-agreement notice period for the L.1226-14 indemnity — only the statutory period counts.

What if the length of service is insufficient for the statutory indemnity?

If the employee does not have the required length of service for the statutory indemnity, the calculation gives: A = 2 × 0 = 0. You then calculate B (collective-agreement indemnity); if B > 0, you pay B. The special indemnity may therefore be nil if the collective-agreement one is also nil — but this is a rare case since most collective agreements provide for lower length-of-service conditions.

Special case: a fixed-term contract terminated for occupational unfitness

For a fixed-term contract (CDD), the termination indemnity cannot be less than double the statutory severance indemnity (Article L.1226-20, paragraph 4), with no one-year length-of-service condition (pro-rated if less than one year). Added to this is the precarity indemnity (10%), which combines with it — early termination for unfitness not being one of the exclusion cases under Article L.1243-10.

Calculation checklist — summary in 6 steps

Fix the dates: unfitness examination, receipt of the opinion, notification of dismissal.
Qualify the origin at the termination date: occupational (workplace accident/occupational illness) or not.
Calculate A = 2 × statutory indemnity (L.1234-9).
Calculate B = collective-agreement indemnity (not doubled).
Pay max(A, B) + the L.1226-14 indemnity “equal in amount to the notice period” (statutory duration).
Word correctly the pay slip and letter (references to articles, exact terminology).

FAQ — Special indemnity for occupational unfitness

Is the special indemnity subject to income tax?

The special severance indemnity follows the tax regime of severance indemnities: it is exempt within the limits provided by Article 80 duodecies of the French General Tax Code (the higher of 2 times the annual gross remuneration or 50% of the indemnity paid, up to a ceiling of 6 times the annual social-security ceiling, PASS).

Can the special indemnity be combined with damages?

Yes. If the dismissal is held to be without real and serious cause (for example, for failure to redeploy), the employee may obtain damages in addition to the special indemnity. The compensation floor is 6 months’ salary (Article L.1226-15), with no application of the “Macron scale”.

Can the collective-agreement indemnity be doubled?

No, unless the collective agreement expressly provides for it. In the absence of a doubling clause, only the statutory indemnity is doubled. The collective-agreement indemnity serves only for comparison purposes (Cass. soc., 25 March 2009, no. 07-41.708).

Need to check your indemnity calculations? Contact DAIRIA’s lawyers for an audit of your final settlement.

Going further: severance indemnity simulator | complete dismissal guide

The procedure for recognising a workplace accident or occupational illness

Managing workplace accidents and occupational illnesses (AT/MP) is a major challenge for employers, both in human and financial terms. The legal framework is set out in Articles L.411-1 et seq. of the French Social Security Code.

Regarding workplace accidents, Article L.411-1 of the Social Security Code defines a workplace accident as any accident occurring by reason of, or in connection with, work, whatever its cause. The presumption of attribution operates in the employee’s favour: where the accident occurs at the time and place of work, it is presumed to be work-related.

The employer must:

Declare the accident within 48 hours (Article R.441-3 of the Social Security Code) via the DSN (nominative social declaration) or Cerfa form no. 14463*03
Provide the employee with the accident sheet (form S6201), enabling them to benefit from 100% coverage of medical expenses
Issue reasoned reservations where applicable, within the accident declaration (DAT) itself, if the employer doubts the work-related nature

The primary health-insurance fund (CPAM) has a period of 30 clear days to rule on recognition of the work-related nature (90 days in the event of additional investigations). Consult our AT/MP guide to learn your rights and obligations.

The financial impact of workplace accidents/occupational illnesses on employer contributions

The AT/MP contribution rate is directly linked to the company’s claims record. Three tarification methods exist depending on headcount:

Collective tarification (companies with fewer than 20 employees): rate set by sector of activity
Mixed tarification (from 20 to 149 employees): combination of the collective rate and the establishment’s own rate
Individual tarification (150 employees and above): rate calculated on the establishment’s own claims record

The average cost of a workplace accident is categorised according to the length of the work stoppage and the after-effects. A serious accident with permanent incapacity can impact the AT/MP rate for 3 consecutive years, representing a considerable additional contribution cost.

The Court of Cassation held, in a ruling Cass. 2e civ., 16 November 2023, no. 22-11.789, that an employer may challenge the enforceability of the coverage decision even after the deadline for challenging the contribution rate, provided it invokes a substantial procedural defect.

It is therefore essential to actively monitor your AT/MP rates and to challenge coverage decisions where the conditions of the presumption of attribution are not met. Our firm, through DAIRIA IA, can support you in the automated monitoring of your claims record.

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