This book provides a wide-ranging review of the European rules relating to distribution: exclusive purchase and exclusive supply, exclusive and selective distribution, motor vehicle distribution, franchises, commercial agents.

French Distribution Law

Breaches by the sales representative in his contractual obligations are likely to characterize a real and serious cause of dismissal. The real and serious character of the reasons relied on and their capacity to justify dismissal fall within the trial courts' discretion which, where there is a doubt, must give the benefit thereof to the employee (Labor Code, Article L. 1235-1).
1) Breach of the ob …

Termination for fault.

The termination is attributable to the sales representative not only where he fails to comply with his contractual obligations but also where he refuses a non-substantial change in his contract. In such a case, the termination takes the form either of a dismissal for fault, or a resignation.

Regardless of the nature of the termination, the sales representative is not required to give the sums received in the course of the contract back, even advances on the goodwill indemnity . In effect, these sums are regarded as additional to the salary .

Cass. soc., 23 November 1999, LawLex200200004577JBJ: an exclusive sales representative commits serious misconduct justifying his immediate dismissal where he encourages customers of his employer to buy supplies from a rival.

Cass. soc., 29 November 2000, LawLex200200004451JBJ: sums received by the sales representative in the course of the contract and having the same purpose as the goodwill indemnity are additional and may be cumulated with the contractuall termination indemnity.

Resignation or dismissal for fault.

Under labor law, a distinction is traditionally made between substantial changes in the contract which must be accepted by the employee before being implemented and non-substantial changes in the contract which fall within the employer's management powers and, as such, are imposed on the employee. An employee who refuses a non-substantial change takes the initiative of the termination which is regarded as a resignation, or even gross misconduct justifying his immediate dismissal .

The adoption of a new commercial policy , the setting-up of maximum sales quotas , the designation of a commercial representative in charge of supervising the follow-up and animation of the representation in a geographic area that is larger than the area entrusted to the sales representative , a change by the employer in the sales representative's canvassing area which does not require him to cover greater distances and includes financial compensation  and the unilateral modification of the method of calculating commissions for a minor aspect of the remuneration  are non-substantial changes in the sales representative's contract.

Cass. soc., 16 June 1988, LawLex200200006072JBJ: a sales representative commits gross misconduct justifying his dismissal where he refuses to draw up a daily business report instead of the weekly report set forth in the contract of employment.

Cass. soc., 19 June 2001, LawLex200200004442JBJ: the adoption of a new commercial policy is not a change in the contract of employment making the termination notified by the sales representative attributable to the employer. 

CA Rennes, 19 February 1998, LawLex200200004256JBJ.

CA Bordeaux, 21 September 1999, LawLex200200004239JBJ.

Cass. soc., 19 July 1988, LawLex200200006057JBJ.

Cass. soc., 12 June 2014, LawLex201400002113JBJ.

Refusal of a non-substantial change in the contract of employment.

Breaches by the sales representative in his contractual obligations are likely to characterize a real and serious cause of dismissal. The real and serious character of the reasons relied on and their capacity to justify dismissal fall within the trial courts' discretion which, where there is a doubt, must give the benefit thereof to the employee (Labor Code, Article L. 1235-1).

The sales representative who: proposes products competing with those of his employer to his customers , is introduced through his spouse to a business competing with his employer in breach of his contractual commitments , encourages his employer's customers to buy supplies from a rival , refuses to refrain from representing a rival of his employer , creates a competing undertaking whereas he is bound by an exclusivity clause , uses on behalf of a company which he manages, the know-how of one of his colleagues in order to create models similar to those of his employer even if the competing activity has not started yet on the date of the dismissal , references products not marketed by his employer on his own website in breach of the contractual non-compete obligation , or commits serious misconduct which justifies dismissal.

Where the sales representative is bound by contract to report his business to his employer, he commits misconduct where he does not provide him with a business report , or where he renders reports which are not complete or which cannot be used . The refusal to submit business reports is a real and serious cause of dismissal but is not sufficiently serious to justify immediate dismissal  or the loss of the goodwill indemnity , unless the issue persists after several warnings have been given . By contrast, the occasional drafting of fake visit reports is not misconduct . 

Where targets are unilaterally fixed by the employer, the sales representative may only be reproached for not reaching them if those targets are attainable  and if their non-achievement does not result from causes external to the sales representative . Where the insufficient results come from professional incompetence or misconduct attributable to the sales representative , the dismissal has a real and serious cause . Thus, the termination of the contract of employment is justified regardless of the validity of the assigned targets where the lack of results is owed to insufficient canvassing . Likewise, the sales representative's dismissal is justified where it is established that he has not followed his employer's instructions and has achieved a turnover lower than that of his colleagues canvassing the area .

Cass. soc., 20 January 1999, LawLex200200004465JBJ; 21 June 2006, LawLex200600001533JBJ; Cass. soc., 9 July 2014, LawLex201400002261JBJ, considering the dismissal as a termination for real and serious cause not for serious breach where the representative was not sent a reminder of his obligation to apply for prior authorization or of the sanctions incurred.

Cass. soc., 26 October 1999, LawLex200200004461JBJ.

Cass. soc., 13 December 2006, LawLex200600002574JBJ.

Cass. soc., 18 February 2015, LawLex201500000216JBJ.

Cass. soc., 6 December 1990, LawLex200200006116JBJ: the submission by the sales representative of fake visit reports, where this is an isolated occurence, is not serious misconduct giving rise to loss of the goodwill indemnity.

CA Paris, 6 July 2001, LawLex200400001850JBJ, validating dismissals where it was not demonstrated that the targets, on which the dismissasl were based, were unattainable.

Cass. soc., 9 October 1990, LawLex200200004563JBJ. This is particularly the case where the employer has modified the canvassing zone, Cass. soc., 13 May 2015, LawLex201500000607JBJ.

Cass. soc., 5 June 2002, LawLex200200004557JBJ, on the fact that the failure is attributable to the sales representative.

Cass. soc., 22 January 2003, LawLex200300000863JBJ.

Cass. soc., 9 April 2008, LawLex200800000532JBJ; 20 May 2008, LawLex200800000752JBJ.

Cass. soc., 9 April 2008, LawLex200800000531JBJ; 22 June 2011, LawLex201100001176JBJ; 13 March 2013, LawLex201300000378JBJ.

Cass. soc., 23 November 1999, LawLex200200004577JBJ.

Cass. soc., 27 June 2001, LawLex200200004441JBJ.

Cass. soc., 25 September 2002, LawLex200300000684JBJ; 12 February 2014, LawLex201400000303JBJ.

Cass. soc., 1 December 2004, LawLex200400003320JBJ.

Cass. soc., 2 May 2019, LawLex201900000708JBJ.

Cass. soc., 26 February 2002, LawLex200200004552JBJ. See also Cass. soc., 20 May 2008, LawLex200800000752JBJ: the sales representative does not perform his obligation to report his mission by the mere transmission of comments via phone, where he does not place the employer in a position to know the state of the market and to establish useful and reliable forecasts for employees of the sales force.

CA Colmar, 17 March 1997, LawLex200200006367JBJ.

Cass. soc., 28 November 2007, LawLex200700001973JBJ: the sales representative's refusal, even if repeated, to forward to the employer his weekly business reports in breach of his contractual obligations is not gross misconduct justifying immediate dismissal.

French Distribution Law

594. Termination for fault.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

594. Termination for fault.

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Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise