The offence of concealed work is not automatic in the presence of an illicit flat-rate pay agreement.
Labour Law
Source: Supreme Court – Social Chamber – June 16th 2015, n° 14-16953
First of all, the regulation regarding concealed work has to be reminded.
Indeed, the article L.8223-1 of the Labour Code provides that:
"In the event of termination of the employment contract, the employee, whom services were used by an employer, under the provisions of the article L.8221-3 or by committing the acts mentioned in the article L.8221-5, is entitled to a fixed indemnity equal to a six-month salary."
And the article L.8221-5 of the Labour Code adds that:
"Is considered concealed work by concealing a paid employment, the fact for any employer:
- 1.Either to intentionally avoid the fulfilment of the formality provided in the article L.1221-10, related to the declaration prior to the beginning of the employment;
- 2.Either to intentionally avoid the fulfilment of the formality provided in the article L3243-2, related to the delivery of a payslip, or to mention on it a number of working hours inferior to the one really accomplished, of this mention does not result from a convention or a collective agreement of the adaptation of the working hours concluded in application of the title II of the first book of the third part;
- 3.Either to intentionally avoid any declaration related to wages or social contributions to collection agencies of social contributions or to the tax authority under legal provisions."
In the present case, the Social Chamber of the Supreme Court specified in which conditions the employee was entitled to require the granting of this fixed indemnity.
In this case, an employee had been hired as an escort by a society, with a contract of work for an indefinite period, from December 22nd 2008, which fixed the annual number of working hours to 1645 hours. The employee had signed a flat-rate pay agreement in terms of hours with his company.
On August 31st 2010, he gave his resignation by a letter dated August 31st 2010.
He seized the Labour Court in order to obtain an adjustment of salaries, especially concerning the number of extra hours accomplished in and above the limit of the annual agreed number, as well as the fixed indemnity for concealed work.
The Court of Appeal had considered that the flat-rate pay agreement was illicit and had condemned the employer to pay the employee, on top of the extra hours, the fixed indemnity for concealed work.
The employer appealed to the Supreme Court. In its decision dated June 16th 2015, the Social Chamber of the Supreme Court, even if it admitted the illicit nature of the flat-rate pay agreement, concluded between the employee and his employer, however it added that the intentional nature of concealed work could not be deducted only from the application of this illicit flat-rate pay agreement.
Therefore, the employee who contests the validity of the flat-rate pay agreement and claims the payment of his extra hours, if he wishes to require the condemnation under the fixed indemnity for concealed work, will have to prove the intention of his employer to avoid the social regulation in terms of concealed work.
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