Dismissal on grounds of unfitness for work: The employee’s refusal of a position in accordance with the occupational physician’s recommendations exhausts the employer’s redeployment obligation

Soc. September 30, 2026, n°25-17.448

In the case of a dismissal on grounds of incapacity of an employee whose proposed redeployment was in accordance with the recommendations of the occupational physician, the Court of Cassation reiterates that it was for the employee to prove a breach of the redeployment obligation, owing to the presumption of proper performance, and that, since the employer had offered a position in the same terms as the recommendations issued by the occupational physician, its obligation had been fulfilled. Consequently, the appellate court’s judgment was quashed.

Occupational physician’s recommendations: an employer’s failure to comply with the recommendations entitles the employee to compensation

Soc. September 9, 2026, n°25-11.901

In this case, an employee sought damages from her employer for breach of its duty of care, on the grounds that it had failed to comply with the occupational physician’s recommendations. Her claim was dismissed on the grounds that she had not demonstrated the consequences of that breach for her health. However, the Court of Cassation overturned this decision, holding that the employer’s breach of its duty of care could, in itself, give rise to a right to compensation, without the employee having to demonstrate its consequences for her health.

Clarification on the limitation period applicable to compensation in lieu of paid annual leave accrued during sick leave

Soc. September 16, 2026, n°25-15.456, n°25-12.609 and n°25-14.826

In three judgments dated 16 September 2026, the Court of Cassation clarified the temporal application of the Law of 22 April 2024 on the accrual and carry-over of paid annual leave during a period of sick leave. The highest court thus held that compensation in lieu of paid annual leave constitutes a wage claim, for which the limitation period for bringing an action for payment is three years from the termination of the employment contract, including where the employee invokes the failure to provide information on their rights or the impossibility of exercising them. Once the limitation period has expired, the 2024 Law does not allow a time-barred action to be revived. However, according to the judges, unlike the limitation period for bringing an action for payment, the scope and amount of the compensation claim are not limited to the three years preceding termination.

Reduction of the Tax and Social Security Exemption Cap for Payments Made upon Termination of Employment under the 2027 Social Security Financing Bill (PLFSS)

Article 6 of the 2027 Social Security Financing Bill

As of 1 January 2027, Article 6 of the Social Security Financing Bill (PLFSS) provides for stricter social security treatment of payments made upon termination of an employment contract. Specifically, the bill proposes reducing the exemption ceiling to one annual social security ceiling (PASS), instead of two as is currently the case. In 2026, one PASS amounts to €48,060, compared with €96,120 for two PASS. The amount of the PASS for 2027 has not yet been set. This ceiling would apply to all termination payments and would harmonise their social security treatment, regardless of the reason for termination. At the same time, the bill proposes maintaining the specific 40% employer contribution on payments made under an approved mutual termination agreement, but on a reduced contribution base. However, it should be noted that the bill is still under consideration, and its provisions may change during the legislative process. The final version of the law, which is expected to be published around December, will undoubtedly provide further clarification.