Voluntary Application of a Collective Bargaining Agreement in France: An Employer’s Guide

The application of a collective bargaining agreement (convention collective) does not always stem from a legal obligation linked to the company’s principal activity. In many situations, an employer deliberately chooses to apply a collective agreement that is not normally applicable to it. This seemingly harmless choice carries considerable legal consequences that every executive must understand before committing.

DAIRIA Avocats analyses the mechanisms of voluntary application, its forms, its effects, and the possibilities of reversing course.

What is the voluntary application of a collective bargaining agreement?

The voluntary application of a collective bargaining agreement refers to the situation in which an employer decides, without being legally required to do so, to subject its company to the provisions of a given collective agreement. This approach differs from mandatory application, which stems either from membership in a signatory employers’ organisation, or from a ministerial extension order (arrêté d’extension) (Article L.2261-2 of the French Labour Code).

In practice, voluntary application may result from several situations:

• The employer wishes to offer a contractual framework to its employees even though no extended agreement covers its sector of activity
• The employer prefers to apply an agreement that is more favourable than the one normally applicable
• The employer makes a mistake as to the applicable agreement and applies another one in good faith
• The employer takes over a company whose employees benefited from a different agreement

Whatever the initial motivation, the legal effects are identical once voluntary application is established.

The forms of voluntary application

The mention on payslips

The most common form of voluntary application results from stating a collective agreement on employees’ payslips. In accordance with Article R.3243-1 of the French Labour Code, the payslip must state the title of the applicable collective agreement. When the employer includes an agreement that is not legally imposed on it, this mention amounts to a commitment to apply that agreement.

The French Supreme Court (Cour de cassation) has consistently established this principle: “the mention of a collective agreement on the payslip amounts to recognition of the application of that agreement to the company” (Cass. soc., 18 November 1998, No. 96-42.991). This case law has been confirmed on numerous occasions (Cass. soc., 15 November 2007, No. 06-44.008).

It is important to stress that this mention creates a rebuttable presumption: the employer may provide contrary evidence by demonstrating that it was a material error, but such evidence is in practice very difficult to produce when the mention appears on payslips over a significant period.

The mention in employment contracts

Including a reference to a collective agreement in employment contracts constitutes an even stronger commitment. As the employment contract is the law between the parties, the mention of a collective agreement in this document creates a contractual right for the benefit of the employee. The Cour de cassation holds that “the reference to a collective agreement in the employment contract constitutes a contractual clause” (Cass. soc., 13 March 2001, No. 99-45.651).

The consequence is major: unlike a unilateral commitment or a custom, a contractual clause cannot be amended or removed without the individual consent of each employee concerned. The employer therefore cannot unilaterally go back on this commitment.

The employer’s unilateral commitment

Voluntary application may also result from a formal unilateral commitment by the employer, for example through a service memo, internal regulations, or a decision posted within the company. This unilateral commitment binds the employer as long as it has not been properly terminated in accordance with the procedure applicable to unilateral commitments.

Company custom (usage d’entreprise)

Finally, the repeated, constant, and general application of a collective agreement may characterise a company custom (usage d’entreprise). For a custom to be recognised, three cumulative conditions must be met: generality (application to all staff or to an objective category), constancy (regular and non-random application), and fixity (determined and stable application criteria).

The legal consequences of voluntary application

The obligation to apply the entire agreement

One of the most debated questions in case law concerns the scope of the commitment: must an employer who voluntarily applies a collective agreement apply it in its entirety, or may it limit itself to certain provisions?

The Cour de cassation’s answer is nuanced. In principle, “an employer who decides to voluntarily apply a collective agreement is required to apply all of its provisions” (Cass. soc., 10 February 1999, No. 96-44.337). This principle rests on the idea that a collective agreement forms an indivisible whole, an overall balance between rights and obligations.

However, case law allows for qualifications. When the employer’s commitment expressly relates only to certain provisions — for example a salary scale or a supplementary insurance scheme (régime de prévoyance) — the courts may limit the obligation to those provisions alone. The Cour de cassation has thus ruled that “where the employer’s commitment relates only to certain benefits of the collective agreement, employees cannot claim the benefit of the other provisions” (Cass. soc., 19 November 2008, No. 07-40.749).

In practice, the distinction between full and partial application depends on the wording of the commitment. A generic mention such as “National Collective Bargaining Agreement for the Metallurgy Sector” on the payslip entails full application, whereas a contractual clause specifying “the provisions relating to leave of CCN X are applicable” may limit the commitment.

The interaction with the mandatorily applicable agreement

Where the company is already subject to a mandatory collective agreement (by extension or employer membership), the voluntary application of another agreement creates a situation of overlap. In accordance with Article L.2254-1 of the French Labour Code, the employee may rely on the most favourable provisions of each of the two agreements, under the principle of favourability (principe de faveur).

This overlap can prove extremely costly for the employer. The comparison is carried out benefit by benefit, within each homogeneous category of provisions, in accordance with settled case law (Cass. soc., 17 July 2001, No. 99-41.917). The employer is then required to apply the most favourable regime resulting from two distinct agreements.

The effects on current and future employees

Voluntary application benefits all employees present in the company at the time of the commitment, as well as employees hired subsequently, as long as the commitment has not been validly terminated. No condition of length of service or professional category can be invoked against them, unless the initial commitment was itself limited to a specified category.

Terminating voluntary application

Termination as a custom

Where voluntary application results from a company custom or a unilateral commitment, the employer may put an end to it by complying with the procedure for terminating customs established by case law. This procedure imposes three cumulative conditions:

1. Information of employee representatives: the social and economic committee (comité social et économique, CSE) must be informed of the employer’s decision to terminate the custom. This information must be sufficiently precise to allow an informed discussion.
2. Individual information of employees: each employee concerned must be informed personally, preferably in writing, of the termination of the custom. A simple posting is not sufficient.
3. Compliance with a sufficient notice period: the employer must allow a reasonable period between the announcement of the termination and its effective date. This period, assessed at the sole discretion of the trial judges, must allow for any substitution negotiations. In practice, a three-month period is generally considered sufficient.

The Cour de cassation recalled these requirements in a leading judgment: “the employer may only remove a custom after complying with the termination procedure, which requires the information of employee representatives and of each interested employee” (Cass. soc., 16 March 1989, No. 85-45.934).

The impossibility of terminating a contractual benefit

By contrast, where voluntary application results from a clause of the employment contract, unilateral termination is impossible. The employer must obtain the express consent of each employee in order to amend or remove the contractual reference to the agreement. The employee’s refusal does not constitute misconduct and cannot justify a dismissal (Cass. soc., 14 May 1998, No. 96-43.767).

An employer who nevertheless wishes to remove the benefit may consider a dismissal on economic grounds if the removal is justified by genuine economic difficulties, but it will have to comply with the entire economic dismissal procedure and pay the corresponding indemnities.

The effects of termination

Proper termination of voluntary application ends the employer’s obligations for the future. Employees can no longer claim the benefit of the agreement’s provisions from the effective date of termination. On the other hand, rights that arose before the termination remain vested: wages due, accrued leave, and indemnities calculated on the basis of the terminated agreement for the prior period.

It is important to note that the termination of voluntary application does not follow the regime of the termination of a collective agreement within the meaning of Article L.2261-9 of the French Labour Code. There is therefore no 15-month survival period (3 months’ notice + 12 months), no obligation to negotiate a substitution agreement, and no remuneration guarantee within the meaning of Article L.2261-13. This distinction is fundamental and constitutes an advantage for the employer wishing to go back on its commitment.

Precautions to be taken by the employer

Before committing

Before voluntarily applying a collective agreement, the employer must assess all the consequences of its choice:

• Evaluate the overall cost: minimum wages, contractual bonuses, increased severance pay, mandatory supplementary insurance scheme, additional leave
• Check compatibility with any agreement already applicable to avoid a costly overlap
• Draft with precision the contractual clause or the commitment memo to clearly define the exact scope of application
• Anticipate the possibility of termination by avoiding irreversible contractual commitments

During application

The employer must ensure that it effectively applies all the provisions to which it has committed. Partial or intermittent application exposes the company to back payments of wages and benefits over three years (the three-year limitation period under Article L.3245-1 of the French Labour Code), and even to damages for disloyal performance of the employment contract.

It must also keep track of developments in the voluntarily applied agreement: amendments, revisions, and new provisions apply to it to the same extent as the initial provisions.

In the event of termination

Termination must be prepared rigorously: assembling a supporting file, scrupulous compliance with the information procedure, granting a reasonable notice period, and, if possible, opening negotiations with employee representatives to accompany the transition.

Litigation risks

Disputes relating to voluntary application are frequent and mainly concern:

• The reclassification of a partial application as a full application
• Failure to comply with the procedure for terminating a custom
• The calculation of back payments of wages and contractual benefits
• Determining the actually applicable agreement in the event of conflict

In the event of litigation, the burden of proof falls differently depending on the situation: it is for the employee to prove the existence of the employer’s voluntary commitment, but it is for the employer to demonstrate that it properly terminated this commitment.

The awards can be significant: back payments of wages over three years, damages, and even the nullity of the dismissal if the termination of a contractual benefit led to an unfair dismissal.

FAQ — Voluntary application of a collective bargaining agreement

Does the mention of a collective agreement on the payslip bind the employer?

Yes. The settled case law of the Cour de cassation holds that the mention of a collective agreement on the payslip amounts to a presumption of voluntary application. The employer is then required to apply the provisions of that agreement, unless it can prove that it was a material error, which remains very difficult in practice.

Can the employer apply only certain provisions of an agreement?

In principle, voluntary application entails the application of all the agreement’s provisions. However, if the employer’s commitment is expressly limited to certain provisions (through a precise contractual clause or a targeted unilateral commitment), the courts may allow partial application. The drafting of the commitment is therefore decisive.

How can voluntary application of a collective agreement be terminated?

If the application results from a custom or a unilateral commitment, the employer may terminate it by informing the employee representatives and each employee individually, while respecting a sufficient notice period. If the application results from a contractual clause, the consent of each employee is required.

What is the difference between terminating a custom and terminating a collective agreement?

The termination of a custom (voluntary application) follows the simple case-law procedure: information of employee representatives, individual information of employees, and a notice period. The termination of a collective agreement in the strict sense follows the statutory regime of Articles L.2261-9 et seq. of the French Labour Code, with a 3-month notice period, a 12-month survival period, and an obligation to negotiate a substitution agreement.

Does voluntary application create a vested individual benefit?

Not in the strict sense. The concept of vested individual benefit (avantage individuel acquis, now replaced by the remuneration guarantee since the 2016 Labour Act, loi Travail) applies only to the termination of an agreement or collective bargaining agreement in the statutory sense. The termination of a custom of voluntary application ends the benefit for the future, without any maintenance under vested individual benefits.