Setting up a Social and Economic Committee

Newsletter - December 2017

The Social and Economic Committee was introduced by an order dated 22 September 2017 with the purpose of simplifying dialogue between employer and employees, by (a) merging the staff representative bodies and (b) enabling the parties to set the powers of the Committee via enterprise-level agreements.

What is the Social and Economic Committee?

The Social and Economic Committee (“CSE” in French) is a staff representative body that will supersede the staff representative bodies that currently exist: staff delegates, the Works Council (WC) and the workplace health, safety and working conditions committee (“CHSCT” in French).

Its implementation will be mandatory in companies with at least eleven employees. This threshold will have to have been met over 12 consecutive months. This is a relaxation of the rules in effect, since, at present, elections must be held for staff delegates when the headcount reaches eleven employees for 12 months whether consecutive or not, over the 36 months prior to the date of the elections.

For companies whose headcount is between 11 and 20 employees, the employer shall invite the trade unions to negotiate the pre-electoral memorandum of agreement only if an employee volunteered as a candidate in the elections within 30 days after the date the staff was notified that elections would be held. Note that after the drafting of the “failure report,” a union or an employee may ask for new elections to be organised only after a period of six months.

The CSE will be made up of:
– the employer or a representative, potentially assisted by three colleagues (two in the case of the central CSE) with consultative power,
– representatives of the staff delegation whose number will be fixed by decree (unless a more favourable agreement is reached),
– a union representative (from one to five per trade union organisation depending on the number of employees).

Timetable for setting up the CSE

In principle, the terms of office of the staff representative bodies will be terminated by 31 December 2019, at the latest. The CSE will then be instituted by 1 January 2020, at the latest. However, there are four potential situations:

1. Pre-electoral memorandum of understanding entered into before 23 September 2017.
The terms of office end by 31 December 2019, at the latest, and the organisational framework prior to the order will need to be applied.

2. The terms of office come to an end sometime between 23 September and 31 December 2017.
The terms of office are automatically extended until 31 December 2017. On or after 1 January 2018:
– either the company sets up a CSE,
– or by an agreement (with 30% of votes in favour) or by a unilateral decision, the terms of office are extended until 31 December 2018, on the understanding that on or after 1 May 2018, the result of the vote must be a majority (50% or over).
The company will be required to institute the CSE by 1 January 2019, at the latest.

3. The terms of office end sometime between 1 September and 31 December 2018.
On or after 1 January 2018:
– either the company sets up a CSE,
– or it reduces or extends by one year, at the most, the terms of office in progress

4. The terms of office end after 31 December 2018.
The company is required to institute the CSE once the terms of office come to an end.

The powers of the CSE

The CSE will chiefly have the assignments that were previously attributed to the staff representative bodies (the staff delegates, the WC, the CHSCT). In companies whose headcount is 50 or greater, the CSE will be given civil personality and may, among other things, bring suit in court, have investigations performed, and even ask for court-ordered inquiries. It assumes the consultative role previously vested in the works council concerning strategic directions, economic and financial situation, labour policy, and working conditions. However, it is not planned that the CSE should take over the powers of the CHSCT with reference to prevention of occupational risks. In general terms, enterprise-level agreements will be able to expand the powers of the CSE and the frequency of its being consulted.
In companies with fewer than 50 employees, the hours spent on delegation issues will be at least ten hours per month, as against 16 hours for the other companies.

We are entirely available if you have any further queries about the issues discussed in this newsletter or about any other accounting, tax, social security or law related topic.

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