Dismissal and Notice Period: A Serious Misconduct During the Notice Period Does Not Deprive of the Dismissal Indemnity

Imagine you are the owner of a flat in Le Cannet, which you rent to a tenant. You decide to terminate the lease to sell the property. You serve notice (the official notification of the end of the lease) with a notice period (the period during which the tenant can still occupy the premises before leaving). But during this notice period, your tenant causes significant damage. You are angry, you want them to leave immediately and you think: "They don't deserve anything anymore!" But is that really the case?

This situation, transposed to the world of work, is exactly what the Cour de cassation (the highest French judicial court) decided in a 1992 decision. An employee dismissed for economic reasons (a reason independent of their person, such as company difficulties) commits a serious misconduct during their notice period. The employer, furious, terminates the notice period and refuses to pay them the dismissal indemnity (the sum due in case of dismissal without serious misconduct by the employee). Who is right?

The judges' answer is clear and protective of acquired rights: the right to the dismissal indemnity arises at the very moment the dismissal is notified. A misconduct committed afterwards, even serious, cannot cancel it. In short, the employee keeps their indemnity. But what exactly does this change for you, as a landlord, tenant, or professional faced with contractual relationships that go wrong? This is what we will analyse.

The facts: a story that happens every day

Let's take the case that led to this decision. Mr. Martin (fictitious name for the example), a manager in a metallurgy factory, is dismissed for economic reasons on 27 April 1987. His employer, the Chausson factories, notifies him of this dismissal and imposes a notice period, i.e., a period during which Mr. Martin continues to work (or is exempt from work but paid) before the effective termination of his contract.

But here's the thing: during this notice period, Mr. Martin commits what the employer qualifies as "serious misconduct". What exactly were they? The judgment does not detail it, but in practice, this could be abandonment of post, insults towards a superior, or acts of sabotage – behaviours that seriously violate the obligations of the employment contract. The employer, considering that these misconducts make it impossible to continue the notice period, decides to terminate it immediately. They terminate the contract on the spot and, above all, they refuse to pay Mr. Martin the dismissal indemnity provided for by the collective agreement (the agreement governing working conditions in a sector).

Mr. Martin challenges this decision. He brings the matter before the industrial tribunal (the specialised labour court), arguing that his right to the indemnity is acquired. The employer retorts: "You committed a serious misconduct during the notice period, you no longer deserve this indemnity!" The first judges may have ruled in favour of the employer, but Mr. Martin appeals, and the case goes up to the Cour de cassation. The judicial twist is crucial: it is about whether an event occurring after the notification of the dismissal can erase a right already born.

The court's reasoning – analysed

The Cour de cassation, in its judgment of 8 July 1992, quashes (annuls) the decision that had deprived Mr. Martin of his indemnity. Its reasoning is based on a fundamental principle of law: the distinction between the birth of a right and its enforceability (the moment when it can be claimed concretely).

The judges explain that the right to the dismissal indemnity "arises on the date of notification of the dismissal". In other words, as soon as the employer notifies the dismissal (without serious misconduct by the employee), the employee acquires this right. It is as if you were promised a sum of money on a specific date: the promise creates the right, even if the money is only paid to you later. Here, the payment is generally deferred to the end of the notice period, but the right indeed exists from the notification.

The serious misconduct committed during the notice period, even if it justifies the employer terminating this notice period (i.e., they terminate the contract immediately without waiting for the end of the period), cannot "lead to the loss" of this right already born. Why? Because the misconduct occurs after the acquisition of the right. The Court states clearly: this rule applies even when the collective agreement (like that of the engineers and managers of metallurgy cited) provides for a separate indemnity for dismissals without serious misconduct. This agreement does not derogate from the principle.

Analysing the arguments: the employer wanted to link the misconduct during the notice period to the loss of the indemnity, considering that the employee had violated their obligations until the end. But the Court rejects this view: the dismissal is already enacted, the subsequent misconduct does not call into question the right acquired at that time. It is a solid confirmation of the protection of employees' rights, preventing employers from using a late misconduct to evade their financial obligations.

What this changes for you – concretely

But how does this labour law decision concern landlords, tenants, or real estate professionals? It illustrates a general principle that applies to many contracts: a right acquired at a time T cannot be called into question by a subsequent event, unless there is a very specific clause. Let's transpose.

If you are a landlord in Antibes and you serve notice to your tenant (for example, to repossess the dwelling), you must respect a notice period. During this notice period, the tenant causes damage (serious misconduct). You can certainly request the immediate termination of the lease and damages for the damage. But if, for example, an eviction indemnity (a sum due in certain cases of notice for repossession) was due, this right was born at the notification of the notice. A misconduct during the notice period does not authorise you to refuse this indemnity. You will have to pay it, while separately claiming compensation for the damage.

If you are a tenant, this is a protection: even if you have a dispute with your landlord during the notice period, your acquired rights (such as the refund of the security deposit if the premises are returned in good condition) remain intact. For a purchaser, this means that defects appearing after the signing of the preliminary sale agreement do not call into question the rights born at the signing, unless there are legal exceptions.

Concretely, with realistic figures: imagine a dismissal with an indemnity of €10,000 due. The employee commits a serious misconduct during the notice period. The employer can dismiss them immediately for serious misconduct (without notice period or specific dismissal indemnity for serious misconduct), but they must still pay the €10,000 of the initial dismissal indemnity, because this right was acquired. How to react? By clearly separating the consequences: the serious misconduct gives rise to sanctions (immediate termination, no paid notice period, possible damages), but it does not erase prior rights.

Four tips to avoid this type of dispute

• Document everything in writing from the notification: Whether you are an employer, landlord, or tenant, as soon as you notify a decision (dismissal, notice), send a registered letter with acknowledgment of receipt specifying the date, the reasons, and the rights born on that date (such as the indemnities due). This sets the starting point of the rights.
• Do not mix disputes: If an incident occurs during the notice period (misconduct, damage), treat it as a separate dispute. Claim damages or immediate termination if necessary, but do not link this to the refusal to pay previously acquired rights. This avoids disputes over complex legal principles.
• Check collective agreements or specific contracts: Some agreements may contain particular clauses. In the case judged, the collective agreement did not derogate from the principle. But always consult the applicable texts to confirm your rights and obligations.
• Anticipate behaviours during the notice period: undefined, I have encountered cases where tenants, embittered by a notice, left the premises in a deplorable state. Prevent this risk by conducting an intermediate inventory or maintaining courteous dialogue, without however waiving your rights.

In-depth analysis: related case law and developments

This 1992 decision is part of a consistent case law of the Cour de cassation that protects acquired rights. Before this, some decisions could be more ambiguous, suggesting that a misconduct during the notice period could call everything into question. Since then, the Court has confirmed this principle several times, for example in a 2006 judgment (No. 04-41.372) where it recalled that a serious misconduct during the notice period does not affect the dismissal indemnity due for the initial dismissal.

The trend of the courts is clear: they carefully distinguish the moment of the birth of the right and subsequent events. What does this mean for the future? It strengthens legal certainty. Whether you are in the jurisdiction of Grasse or elsewhere, you can rely on this rule to defend your rights. However, be careful: this does not mean that one can do anything during the notice period! Serious misconducts always give rise to sanctions (such as immediate termination without paid notice period, or damages), but they do not cancel previously acquired rights.

Checklist before acting

• If you notify a dismissal or notice: 1. Date the notification precisely. 2. List the rights that arise on this date (indemnities, etc.). 3. Inform the other party in writing of these rights.
• If an incident occurs during the notice period: 1. Record the misconduct in writing (minutes, testimonies). 2. Decide if you want to terminate the notice period immediately. 3. Separately claim any damages. 4. Pay the previously acquired rights (such as the dismissal indemnity) without linking them to the incident.
• If you are the party subject to the decision: 1. Check that the notification is regular. 2. Note the date to assert your rights. 3. Even in case of conflict during the notice period, demand respect for the rights born at the notification.
• In all cases: Consult a legal professional if the situation is complex, especially for significant amounts or strong emotional stakes.

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