The notice period coinciding with the reclassification leave entitles the employee to Exceptionnal Purchasins Power Bonus (Prime Exceptionnelle de Pouvoir d’achat or « PEPA »)

Cass. Soc., April 19 2023, n°21-23.092 FS+B 

This ruling sheds light on the treatment of the reclassification leave period in the context of an entitlement to the value-sharing bonus, determined on the basis of the employee’s length of service.

In this case, an employee was dismissed for economic reasons by letter dated October 1, 2018. He signed up for the redeployment leave offered to him for a period of 12 months, including notice, at the end of which his employment contract was terminated.

He was dismissed and placed on notice on October 10, 2018, exempt from activity. His reclassification leave then continued at the end of the 2-month notice period, from December 10, 2018.

At the same time, the employer, by a unilateral decision of January 28, 2019, is introducing an exceptional purchasing power bonus benefiting employees bound to the company by an employment contract in force on December 31, 2018. This bonus is modulated according to two criteria;

– The duration of the contractual working time,

– The employee’s actual time with the company (100% of the amount for 12 months of presence, 80% for 11 months, and 0% for 10 months and less).

The employee was excluded by the employer from the benefit of this bonus and, believing he was entitled to it, he brought an action before the labor Courts.

The Court of Cassation overturned this decision and found in favor of the employer, on the basis of a two-step reasoning:

The period of reclassification leave is not legally considered as time worked. Nevertheless, during this period, the employment contract is suspended, the last day of the notice period being postponed to the end of this leave.

Moreover, the Court recalled that, pursuant to article L.1234-5 of the French Labor Code, the employer’s exemption from performing work during the notice period must not result in any reduction in the wages and benefits that the employee would have received had he or she performed his or her work until the expiry of this period.

The employee on redeployment leave is therefore entitled to the payment of the bonus for the period corresponding to the notice period, as long as he fulfils the condition of presence in the workforce required by the employer’s unilateral decision entitling him to the bonus.

The employee was therefore entitled to receive the Pepa bonus for an amount corresponding to 80% of the reference amount, i.e. 640 €.