Analysis
14 July 2019

French Labor law considerations when dealing with internal investigation

Bastille Day Newsletter 2019 - Legislative, Regulatory & Policy Updates

 

The golden rule is that companies must conduct a neutral and objective investigation, respecting employee individual rights. Through due process, the company must consider both individual rights – including the right to privacy – as well as collective rights – of employee representatives and unions which can be achieved though inclusiveness in the code of conduct.

The employer duty to ensure legal protection

  • It is established that the client is free to choose his/her lawyer whether or not the lawyer’s fees are paid for by the company. Therefore, a company cannot bind its employees to a pre-designated lawyer. It can, however, set a proportionate maximum fee amount not to be exceeded or settle on a contingency fee agreement to anticipate the cost of defense.
  • The French Supreme Court held that employers must provide legal support to employees for acts committed in execution of their work 1.
  • The French Supreme Court based its decision on article 1194 of the French Civil Code 2, which provides that “contracts bind not only to what is expressed in it, but also to all of the implications that equity, usage or law provide.
  • According to this decision, the employer owes judicial protection to the employee unless the latter has committed a fault that does not constitute a corporate risk 3.
  • The employee is also covered by the employer if he/she is prosecuted for facts that fall outside the scope of his/her mission and if no fault or misconduct can be proven.
  • In that specific case, since the employee was dismissed by the criminal court, no fault could be imputed and therefore, the employer owed him judicial protection. The same result was obtained in case of discharge.
  • However, the company does not have to pay for lawyer fees for its non-salaried executive in case of breach to corporate law, neither in case of intentional offense 4.
  • Nevertheless, the fees incurred may be reimbursed by the company if an intentional offense was made in the interest of the company rather than for personal interest 5.

Employee’s guarantees regarding personal data collection

  • Internal investigations often include the collection of numerous documents and information regarding employees’ work (e-mail exchanges, transcript of telephone conversation; social network conversations…) that would be then, analyzed and recorded in the internal investigation report.
  • It results from the law that employee prior consent is required for the collection of some personal data 6.
  • However, non-professional data and information must be excluded at the beginning of the investigation, since it is prohibited to read, use and/or transcribe employee personal data 7.

Involving employee/union representatives in the process of implementing an internal investigation

  • Article 17 of the Sapin II Law 8 requires that companies implement a code of conduct that must be an appendix to the company’s internal rules and regulations.
  • This requirement has the consequence that employee/union representatives must be involved in establishing the code of conduct 9.
  • Some professionals recommend separating disciplinary measures from all other measures related to the anti-corruption plan in order to facilitate debates with employee/union representatives, who may want to get involved in the internal investigation 10.
  • Although employee/union representatives shall be consulted in the drafting of the anticorruption plan, it is not clear whether such a participation exonerates the corporation from informing them of the opening of an internal investigation, which may create an array of concerns.

Related content

Publication
27 February 2024
New sustainability reporting obligations in France: what’s new?
Navacelle contributes to The Legal Industry Reviews' fifth edition about the transposition of the Corporate Sustainability Reporting Directive (CSRD) in...
Publication
The discreet ramping up of environmental criminal law
5 December 2023
The discreet ramping up of environmental criminal law
Navacelle contributes to The Legal Industry Reviews' fourth edition about recent gradual application of environmental criminal law in France, with...
Analysis
UBS
17 November 2023
Saga UBS: second reassessment of the UBS’s historic financial penalty
On November 15, 2023, as part of the UBS saga that began on 20 February 2019, the judges on the...
Press review
22 March 2024
Press review – Week of 18 March 2024
This week, the press review covers the report of the French Court of Auditors on the financial situation of the...
Press review
15 March 2024
Press review – Week of 11 March 2024
This week’s press review covers the implementation by the AMF of two guidelines issued by the European Banking Authority, the...
News
11 March 2024
Webinar: The role of the investigating lawyer (in French)
Stéphane de Navacelle and Julie Zorrilla discussed the role of the investigating lawyer during the Paris Bar's Entrepreneurial Bar training...
Press review
8 March 2024
Press review – Week of 4 March 2024
This week’s press review covers the conviction of Apple to a 1.8 billion euros fine by the European Commission for...
Press review
1 March 2024
Press review – Week of 26 February 2024
This week’s press review covers Washington's adoption of new sanctions against Russia, the involvement of a French municipal agent in...
Analysis
26 February 2024
A flexible approach of the principle of loyalty regarding the evidence in civil matters –...
The decision of 22 December 2023 recognizes the admissibility of evidence obtained or produced in an illicit or unfair manner...
Press review
23 February 2024
Press review – Week of 19 February 2024
This week’s press review covers Donald Trump and his sons’ conviction for fraud in New York, the decision of Paris...
Analysis
22 February 2024
New clarifications on the repression of tax fraud offences and tax fraud laundering by the...
On 13 December 2023, the Cour de cassation first ruled on the concept of non bis in idem, rejecting the...
Event
21 February 2024
Paris Arbitration Week 2024 – Ethics & Arbitration panel
Navacelle is hosting a panel regarding Ethics & Arbitration on 19 March 2024, during the Paris Arbitration Week (PAW).
Analysis
20 February 2024
A French dairy group suspected of tax fraud
Since 2018, Lactalis has been suspected of committing tax fraud and laundering the proceeds of such fraud via schemes involving...
Press review
16 February 2024
Press review – Week of 12 February 2024
This week’s press review looks back at the legacy of former French minister of Justice Robert Badinter who recently passed...