Remuneration Maintained Despite Reduction in Working Time: What Does the Court of Cassation Say?

Imagine for a moment: you are the manager of a small business in Rennes, rue de la Monnaie. For years, one of your employees, Jean, regularly worked overtime. Then, in 1982, an order reduced the legal working hours. You reduce his working time, but Jean expects his hourly rate to increase to compensate for the loss of overtime he will no longer do. The question that haunts every employer: are you obliged to increase the hourly wage? The Court of Cassation ruled in 1990.

This decision, handed down on 4 December 1990 (No. 85-41.289), concerns an employee whose working hours were reduced pursuant to Order No. 82-41 of 16 January 1982. The employee claimed the maintenance of his gross monthly remuneration, but also the integration into the hourly rate of the remuneration for overtime he previously performed. Result? The Court of Cassation upheld his claim for maintenance of remuneration, but not for the increase in the hourly rate.

In practical terms, this means that if you reduce an employee's working time pursuant to a law, you must pay them the same monthly remuneration as before, unless the law provides otherwise. But you are not required to increase their hourly rate by fictitiously including past overtime. A nuance that is important for businesses and employees.

The Facts: A Story Like Many Others

Mr. X, an employee of a company in Vitré, had been working since 1975 on a schedule of 40 hours per week, including regular overtime. In 1982, Order No. 82-41 reduced the legal working hours to 39 hours per week. Mr. X's employer therefore reduced his working time to 39 hours, but maintained his gross monthly salary.

Mr. X brought the matter before the Conseil de prud'hommes (Employment Tribunal) of Rennes. He claimed not only the maintenance of his remuneration, but also that his new hourly rate should be calculated by incorporating the portion of overtime he performed before the reduction. According to him, the hourly rate should have been increased to compensate for the loss of overtime premiums (generally increased by 25%).

The Conseil de prud'hommes partially dismissed his claim: it recognised the right to maintenance of the monthly remuneration, but refused to modify the hourly rate. Mr. X appealed, but the Court of Appeal of Rennes upheld the judgment. He then appealed to the Court of Cassation. The Court of Cassation dismissed his appeal on 4 December 1990, confirming that the employee is entitled to maintenance of his remuneration, but not to an increase in the hourly rate including overtime.

The Reasoning of the Court — Analysed

The Court of Cassation relies on Order No. 82-41 of 16 January 1982, which reduced the legal working hours from 40 to 39 hours per week. Article 1 of this order provides that the reduction in working hours cannot entail a reduction in monthly remuneration. This is the principle of "maintenance of salary."

On the other hand, nothing in the text requires the employer to recalculate the hourly rate by incorporating the remuneration for overtime that the employee performed before the reduction. Overtime is by nature exceptional and variable. Incorporating it into the hourly rate would effectively perpetuate it, which the law did not intend.

The Court thus distinguishes between two concepts: the maintenance of monthly remuneration (mandatory) and the calculation of the hourly rate (free, subject to not being below the SMIC or the collective agreement). The judges considered that the employee cannot demand that the remuneration for past overtime be integrated into the hourly rate, as this would artificially increase that rate beyond what the law provides.

This decision is a strict application of the 1982 order. It confirms that the employer must maintain the monthly remuneration, but does not have to compensate for the loss of overtime premiums. This position was subsequently applied to other reductions in working time.

What This Means for You — In Practice

For employers, this decision is rather reassuring. If you reduce an employee's working time pursuant to a law (or a collective agreement), you must maintain their gross monthly remuneration. But you do not have to increase their hourly rate to compensate for overtime they will no longer do. However, be careful: if the employee was paid at the SMIC, the reduction in working time must not bring them below the hourly SMIC. Check the applicable collective agreement minima.

For employees, the message is clear: you keep your monthly salary, but you lose overtime premiums if you no longer work overtime. Concrete example: in Rennes, an employee paid €2,000 for 40 hours (including 2 overtime hours with a 25% premium) saw his monthly salary maintained at €2,000 for 39 hours. His hourly rate went from €11.54 to €11.83 (since 2000/39/4.33), but without incorporating the premiums. This is not an increase; it is a simple mathematical adjustment.

If you are a union representative or HR manager, incorporate this principle into your negotiations: during a reduction in working time, salary maintenance is mandatory, but the hourly rate can remain unchanged. Avoid promising a revaluation of the hourly rate based on past overtime.

Four Tips to Avoid This Type of Dispute

• Keep previous payslips: in the event of a reduction in working time, keep a record of salaries and overtime for the last 12 months to justify the maintenance of remuneration.
• Draft an amendment to the employment contract: clearly state that the monthly remuneration is maintained, but that the hourly rate is recalculated without including overtime.
• Inform the employee in writing: send a letter explaining the new calculation of the hourly rate and the maintenance of the monthly salary, to avoid any misunderstanding.
• Check collective agreement provisions: some collective agreements provide additional guarantees (e.g., maintenance of the hourly rate). Check yours before modifying the contract.

Further Reading: Related Case Law and Developments

This 1990 decision is part of a consistent line of authority. The Court of Cassation reaffirmed this principle in a decision of 14 November 2000 (No. 98-44.280): the employee whose working time is reduced retains their monthly remuneration, but the hourly rate may be reduced, provided that the SMIC and collective agreement minima are respected.

More recently, in the context of the 35-hour week (Aubry laws), case law confirmed that salary maintenance is due, but that previous structural overtime is not integrated into the hourly rate. The logic is the same: overtime is by nature variable and cannot be perpetuated in the hourly rate.

Notable development: since the 2016 Labour Law, company agreements may provide different arrangements. If a collective agreement provides for the integration of overtime into the hourly rate, it prevails over case law. But in the absence of an agreement, the 1990 principle remains applicable.

Checklist Before Taking Action

1. Have I correctly identified the cause of the reduction in working time? (law, collective agreement, unilateral decision?) Salary maintenance is only mandatory if the reduction results from a legal or conventional provision.
2. Have I calculated the new hourly rate while respecting the SMIC and the collective agreement? The maintenance of the monthly salary must not result in an hourly rate below the legal minimum.
3. Have I informed the employee in writing of the new terms? An amendment to the contract is recommended to secure the situation.
4. Have I kept documents justifying the maintenance of remuneration? Payslips, amendment, information letter.
5. In the event of a dispute, have I consulted a specialised lawyer? The Employment Tribunal may reclassify the situation if the employee proves damage.

Are you in a similar situation? A first 30-minute consultation with Maître Zakine (€45) can save you months of proceedings — and often much more. Book an appointment →