Does an employer's freedom to stop working take precedence over the protection of pregnant women against dismissal?
In Luxembourg, a pregnant employee is protected against dismissal from the moment her pregnancy is certified by a doctor until twelve weeks after the birth [1] [2].
The Luxembourg Court of Appeal had occasion to point out that there could be exceptions to this protection in a recent case [3].
In this case, an employee informed her employer that she was pregnant and submitted a medical certificate dated 23 July 2021 stating that she was pregnant. The employee requested 6 months' parental leave. By letter dated 5 October 2021, the employer refused his request on the grounds that "the Company is expected to cease activity on 31 December 2021. It is for this reason unfortunately that we are not in a position to grant you this request." (the Company is expected to cease activity on 31 December 2021. It is for this reason unfortunately that we are not in a position to grant you this request.)
By letter dated 27 October 2021, the pregnant employee was dismissed with 2 months' notice effective 31 December 2021 on the grounds that her employer had ceased trading.
Following receipt of her letter of dismissal, the employee asked the employment tribunal to declare her dismissal null and void and to order that she remain in her job, if not be reinstated.
On 21 December 2021, the Labour Court declared the employee's claim unfounded. It held "that the employer had done everything possible to ensure that her business would cease on 31 December 2021 and that the decision to cease business was a matter for the employer, who could not be required to continue his business solely in the interests of an employee in a state of pregnancy".
The Court of Appeal upheld the Labour Court's decision. Following this decision, the employee appealed to the Luxembourg Court of Cassation, which quashed and annulled the order handed down by the Court of Appeal on the grounds that the latter had failed to respond to the arguments of the plaintiff, who "had argued that the decision to dismiss her constituted 'a clear abuse of rights, since it was only when the pregnancy was announced that the employer took the decision to close down its activities'" and to the fact "that her employment contract was not maintained for the duration of her maternity leave, even though the closure of the company's liquidation will necessarily take place several months after the company is put into liquidation".
Following this ruling, the case was again heard by the Court of Appeal.
In such a situation, the question arises as to what interest prevails between two opposing interests, that of protecting a woman whose pregnancy is medically established from dismissal and that of the employer's freedom to cease his activity.
[1] Article L. 337-1 du Code du travail
[2] In the event that an employee receives a letter of dismissal or a notice of interview before being able to inform her employer of her pregnancy, she may still send a medical certificate stating that she is pregnant by registered letter within eight days of the dismissal. In this case, the dismissal becomes null and void. Employers with at least 150 employees who intend to dismiss an employee must, before taking any decision, summon the employee concerned to a preliminary interview (article L. 124-2 of the Labour Code).
[3] Cour d’appel, 23 juin 2023, CAL-2022-00121du rôle
The Court of Appeal (1) recalled that the protection of "pregnant persons, persons who have recently given birth or who are breastfeeding" is inapplicable in the event of the voluntary cessation of the employer's activity and (2) held that the employer's decision to cease his activity in Luxembourg did not constitute a clear abuse of rights..
1) The employer's freedom to stop work takes precedence over the protection of pregnant women against dismissal…
The Court of Appeal ruled that "As rightly pointed out by the court of first instance, it is settled case law that the protection provided by the aforementioned Article L.337-1 of the Labour Code is inapplicable in the event of the employer's voluntary total cessation of activity”.
The Court specified that "to oblige an employer to maintain his activity because of an employee in a state of pregnancy and in the exclusive interest of the latter would place inadmissible restrictions on the employer's ability to decide on the future of his business, unless there was a clear abuse of rights".
In this ruling, the Court of Appeal also clarified that it was possible to give notice of dismissal when the notice period ended on the day on which the company ceased trading (in this case on 31 December 2021), even if the maternity leave had not yet ended at that time and the liquidation was closed and the company was struck off the register of companies at a later date (in this case on 29 November 2021 and 16 March 2022 respectively).
It is clear from this judgment that an employer's right to cease its activities takes precedence over the right of a pregnant employee to remain in her job. Forcing an employer to continue his business because of an employee's pregnancy, and in the exclusive interest of the employee, would constitute a restriction on the employer's right to decide on the future of his business, unless there was a clear abuse of rights.
2) … Except in cases of abuse of rights by the employer
The Court of Appeal verified the reality of the employer's definitive cessation of activity and the absence of abuse of rights by the employer in its decision to cease its activity.
The following evidence, provided by the employer, enabled the Court of Appeal to find that the employer's decision to definitively cease its activity had been taken before the announcement of the employee's pregnancy, that the activities had effectively ceased, and that no abuse of rights had occurred:
- Employer's decision to migrate to a new computer system taken before the employee's pregnancy was announced;
- IT migration process implemented prior to the announcement of the employee's pregnancy;
- Email dated 24 September 2021 referring to a meeting mentioning the tasks to be performed in connection with the transfer of the company's commercial activity and the IT migration already implemented ;
- ermination of the telephone and internet subscriptions, as well as the premises cleaning contract, with effect from 31 December 2023 ;
- Termination of the payroll service contract with effect from 31 December 2023 ;
- Termination of the lease agreement with effect from 31 December 2023 ;
- Letter informing customers and suppliers that the company's activities will cease on 31 December 2023;
- Deed of dissolution and liquidation signed by a notary.
In conclusion, this ruling by the Court of Appeal reminds us that the provisions protecting pregnant women against dismissal do not apply in the event of an employer's voluntary total cessation of activity, unless there is a clear abuse of rights on the employer's part, and that it is important to formalise in writing and keep a record of the employer's decision to voluntarily total cessation of activity, as well as of all the steps taken in relation thereto. In addition, this case raises the question of the possible conditions under which a decision to cease working after an employee has announced her pregnancy could constitute an abuse of rights.
By Eva Christophe