Co-employment: a risky concept for an over-intrusive parent company
Nicola Kömpf, Mathilde Gicquel
As inter-company relations evolve, particularly in the context of groups or complex subcontracting, the limits between influence and interference are increasingly being examined by the courts. The recent French “Cour de cassation” decision of October 9, 2024, involving the Française des Jeux (FDJ) illustrates this trend (Cass. soc., 9 oct. 2024, n° 23-10.488, F-B).
In France, co-employment, historically defined as «confusion of interests, activities and management», was redefined by a major decision on November 25, 2020. For a company to be recognized as a co-employer, simple coordination between entities belonging to the same group is no longer sufficient. The essential condition is «permanent interference» in the employer’s social and economic management, leading to a total loss of autonomy for the employer. This nuance is designed to protect the legal independence of legal entities, while punishing manifest abuse.
The application of this concept is particularly important when it comes to the parent company’s liability in the event of economic difficulties and insolvency proceedings involving the group’s French subsidiary.
In the FDJ case, employees dismissed for economic reasons by an affiliated company attempted to have FDJ recgnized as a co-employer. In their opinion, FDJ’s overriding influence on their employer’s commercial policy had destroyed its autonomy.
However, the “Cour de cassation” rejected this claim. Although FDJ had exercised a significant influence, notably because of its monopoly and centralized commercial coordination, the affiliated company retained sufficient flexibility in matters of social management, recruitment and salaries.
This decision confirms a trend in case law: only total and proven interference justifies the recognition of co-employment. Judges refuse to confuse economic dependence or legitimate coordination with a loss of autonomy.
The tightening of the criteria for co-employment reflects a desire to limit this notion to exceptional situations. While this approach provides companies with more legal security, it also requires employees to provide strict proof of the interference complained of.
Thus, co-employment remains a rare but powerful legal weapon. The ruling of October 9, 2024, takes a clear line: only flagrant abuse of legal personality can override the principle of corporate independence.
For companies, it is a reminder to be vigilant: any interference must be measured and justifiable. For employees, the decision illustrates the challenges of such recognition, but also the importance of accurately documenting situations of interference.
Far from being a fixed concept, co-employment is still playing an important role in shaping intercompany relations.