D1a11 - Is a party who is the victim of a unilateral termination of a contract before the start of work entitled to payment of compensation in lieu of notice?

As soon as the employment contract is signed, there is a definitive concurrence of will concerning the employment contract intended to take effect on the date agreed between the parties.

The employment contract having thus been formed, the parties are bound by the terms of the employment contract.

The Court has given judgment to the effect that the parties made a forward commitment and the expiry of the suspensive term (a future event certain to materialise) rendered the obligation enforceable from that moment. The date on which the contract was signed was irrelevant in those circumstances and it was irrelevant whether or not the work had started to be performed. A contract of indeterminate duration, even if terminated before any inception of implementation, may therefore give rise to the right to notice.

With regard to entitlement to the payment of compensation in lieu of notice, a distinction should be drawn between the situation where the parties have agreed upon a probationary period and the case where a probationary period is not provided for in the employment contract.

Thus, in the event of termination before the commencement of professional activity under an employment contract which does not include a probationary period, compensation in lieu of notice is due.

In contrast, in the event of termination before the commencement of professional activity under an employment contract which includes a probationary period, compensation in lieu of notice is not due.

In fact, in the event of signature of an employment contract including a probationary period, Article L.121-5 of the Labour Code relating to the probationary period is applicable. That Article provides that the probationary contract cannot be terminated unilaterally during a minimum period of 2 weeks, except on serious grounds. The Article then specifies the notice periods to be observed in the event of termination of the contract during the probationary period.

It should be noted that Article L.121-5 does not provide for the award of compensation in lieu of notice in the event that one of the parties terminates the probationary contract during the minimum period of 2 weeks, in the absence of serious grounds, or, after this minimum period, without respecting the notice periods.

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