Dismissal for economic reasons: pay attention to notify the grounds in due time!

An improperly handled economic dismissal remains a dismissal without genuine and serious cause, even if the employee accepts the professional security contract (CSP). The French Court of Cassation reaffirmed this principle in a ruling dated March 26, 2025 (No. 23-21.099), emphasizing the importance of complying with the formal requirements regarding informing the employee of the reasons for the termination.

In this case, an employee had accepted the CSP after being summoned to a preliminary meeting for dismissal on economic grounds. The employer sent the letter outlining the economic reasons one day after the employee had accepted the CSP.

According to the Court of Cassation, the CSP is considered accepted at the moment the employee sends the acceptance form, not when the employer receives it. Therefore, the written information explaining the economic reason must be provided no later than the date the employee sends the CSP acceptance form.

If not, the dismissal is considered without genuine and serious cause.

Key points to remember:

• The obligation to inform the employee of the economic grounds for termination is strict: at the latest by the date the employee sends the CSP acceptance form, the employer must have provided a written and detailed explanation of the economic reasons for the dismissal.

• A simple oral explanation, a collective summary, or implicit understanding of the economic context is not sufficient.

Practical advice to secure the process:

• Draft a clear and detailed explanatory note stating the economic grounds in accordance with Article L. 1233-3 of the French Labor Code.

• To avoid complications, provide this note at the same time as the CSP-related documents.

• Keep proof that the economic reason was communicated before the employee responded to the CSP.