Length of service in corporate groups

Employee mobility and temporary work (see English translation below)

Ensuring the geographic mobility of employees is a major concern for corporate groups, both nationally and internationally.

Does this mobility have any impact on the employee’s length of service?

The answer to this question is fundamental.

Indeed, length of service is the benchmark for determining, among other things, what the employee should be paid in the event of dismissal with notice. This seniority is used to determine the legal notice period to be respected (hence the monthly wages due to the employee and the days of vacation to be accrued during this notice period), as well as the amount of any severance pay due to the employee.

Case law considers that length of service is based on the idea of loyalty to the employer’s company, and thus on the corporate bond between the employee and his employer.

With this in mind, case law holds that length of service must be determined from the moment the employee joins the company, disregarding any contractual splits during the employment relationship.

This means that simply transferring an employee from one company to another within the same group does not interrupt seniority.

However, the conditions sine qua non for seniority to be determined from the first day of the employee’s employment are, firstly, that the group of companies constitutes an economic and social unit considered as a single enterprise, the employee’s only real employer, and secondly, that there has been no real interruption in service.

The same conclusion applies when the employee’s status changes during the employment relationship.

However, the issue becomes more complex in a particular case: within the same group of companies, one of them (established in the Grand Duchy of Luxembourg) calls on the services of a temporary employment agency (established in the Grand Duchy of Luxembourg) to place one of its employees, already employed by the former under an open-ended employment contract, with another company in the same group (established in France) to perform the same duties in the Grand Duchy of Luxembourg. This employee was then subsequently re-employed by the first company, again in the same capacity and under a second open-ended employment contract, only to be dismissed with notice.

Does this temporary employment of the employee as a temporary worker within the same group of companies interrupt the employee’s length of service?

Provided that the two aforementioned sine qua non conditions are met, case law has answered this question in the negative, pointing out that “to admit the contrary would be to allow certain employers to misuse the provisions of the Labor Code relating to job security and, in particular, seniority of service, via artificial divisions by interim employment contracts” (C.A., March 7, 2019, no. 45250 on the roll). Let’s hear it…