The right to an economic warning is reserved to the Social and Economic Committee representing the employees at company level
When the SEC is aware of facts that are likely to have a worrying effect on the economic situation of the company, it can ask the employer to provide explanations. This right, provided for in Article L. 2312-63 of the French Labor Code, is known as the "economic warning right".
Under French law, when a company has several establishments, each one can have its separate SEC. All the establishments’ SECs are then represented in a Central SEC.
The principle is that an Establishment SEC has the same prerogatives as the “regular” SEC within the limits of the powers of the head of the establishment.
By a decision of June 15th 2022, the French Supreme Court confirmed its case law according to which an Establishment SEC cannot proceed to an economic warning, including in a context where :
- The Central SEC had not implemented its economic warning right;
- The contemplated economic operation was the closure of the establishment.
In other words, since the right of economic warning concerns the company’s economic situation, the Central Works Council - acting at company level - is the sole competent body to implement this right.
The judgment can be found in full on the Cour de Cassation website.