Business Contracts

Like agency agreements, employment contracts involve an obligation to do something for someone else. The status of employee, and therefore the classification as an employment contract, can be sought, as it enables the worker to benefit from the protection of employment laws. According to case law, an employment contract is characterized by the commitment of one person to work for and under the dir …

Employment contract

Like agency agreements, employment contracts involve an obligation to do something for someone else. The status of employee, and therefore the classification as an employment contract, can be sought, as it enables the worker to benefit from the protection of employment laws. According to case law, an employment contract is characterized by the commitment of one person to work for and under the direction of another, in return for a salary. The legal relationship of subordination in which the employer holds the employee is expressed by the power to give orders and instructions, to monitor their implementation and to penalize the employee's failings .

Under an agency agreement, the agent is not subordinate to the principal: he or she is independent. Sales agents are the typical example of agents who carry out their activities independently of their principals. As such, they are presumed, under Article L. 8221-6 of the Labor Code, not to be bound to the principal by an employment contract in the performance of the activity giving rise to their registration in the commercial agents' register. However, a commercial agency agreement may be reclassified as an employment contract if the agent does not carry out his activity independently, i.e. without assuming the commercial and financial risks of his activity and/or in a subordinate relationship to the principal. Thus, an agent who, although registered in the commercial agents' register, is required to be present on the undertaking's premises every day, to take part in working meetings, to report on his activity and is subject to the disciplinary authority of his so-called principal, who issues orders and directives, is in this case a salaried employee .

The independence of the agent is associated with a certain degree of uncertainty, since he or she can be dismissed ad nutum, just like a corporate officer. For this reason, a senior executive may seek to classify the contract as an employment contract, since recognition of his status as an employee would entitle him to benefits (paid leave, unemployment benefits, profit-sharing, etc.) to which he would not be entitled as a corporate officer . Provided he can demonstrate the subordinate relationship that characterizes an employment contract, the courts recognize that he can combine his employment with that of a corporate representative. According to the Court of Cassation, there is no legal incompatibility between the existence of an employment contract and an agency agreement with which the employee is entrusted or entrusted on behalf of a third party, whatever the consequences of the exercise of this agency agreement on the performance of the obligations arising from the employment contract .

CA Nîmes, 30 June 2022, LawLex202200004284JBJ, distinguishing between employment contracts and contracts for services.

CA Montpellier, 29 June 2011, LawLex201100001390JBJ. In this vein, see also CA Paris, 16 September 2010, LawLex201100001022JBJ; 10 May 2016, LawLex201600000925JBJ, holding that the representative's obligation to attend weekly work meetings on his co-contractor's premises, the review of his diary with a view to optimizing his appointments and the sanction for any breach of the obligation to provide information on his activity go beyond the normal framework of the reporting obligation imposed on an agent and reflect the existence of an organized department within which he carries out his work under the direction and control of an employer.

Cass. Soc., 20 October 1976, LawLex202200009155JBJ, holding that the chairman of the board of directors and the director general are agents of the company, and can be dismissed at any time by the board of directors, and not employees entitled to paid leave, regardless of whether they are receiving a salary, a circumstance which is not sufficient to create, between them and the board, the relationship of subordination which characterizes a contract of employment.

Cass. Soc. 25 February 1988, LawLex202200010544JBJ.

Business Contracts

466. Employment contract

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

466. Employment contract

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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