Economic redundancy in a company in receivership: what is the procedure?
Verified 08 April 2025 - Directorate for Legal and Administrative Information (Prime Minister)
Additional cases ?
When a company is in financial difficulty, it can be put into receivership as part of a collective proceedings. This starts with a period of observation. This period is used to diagnose the situation and determine the measures that will allow the activity to continue. Following the observation period, the court may establish a judicial recovery plan. We're doing an update on the regulations.
At the beginning of the collective proceedings, the commercial court invite the employer to appoint or have elected a representative of the employees.
The main task of the employee representative is to check the statement of wage claims drawn up by the judicial representative. In the absence of ESCESC : Social and Economic Committee, he shall carry out the tasks of the members of the ESC.
The economic redundancy procedure differs depending on whether the company is in an observation period or in the recovery plan.
During the observation period
During the period of observance of the procedure, dismissals on economic grounds may be authorized by the Judge-Commissioner if they are of an urgent, unavoidable and indispensable nature.
Step-by-step approach
The procedures for consulting the ESCESC : Social and Economic Committee differ according to the number of redundant employees and the size of the company.
There are 2 categories of dismissal:
- Small dismissal: from 2 to 9 employees dismissed irrespective of the size of the company,
- Large layoff: at least 10 employees licensed.
The procedure for large-scale redundancy is differences depending on whether the company's workforce is less than 50 employees or 50 or more employees.
FYI
In the absence of the ESC, the employees' representative shall be consulted instead of the ESC. He shall carry out the tasks of the members of the ESC.
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Small redundancy of 2 to 9 employees
The consultation prior to the redundancies provides the EESC with useful information on the proposed collective redundancy. One meeting is mandatory.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The ESC must give its opinion on the proposed dismissal within a maximum period of one month.
After the EESC meeting, the employer or the administrator define the criteria used to determine the order of the redundancies and inform the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) the proposed dismissal.
Large lay-off in a company with less than 50 employees
If at least 10 persons are made redundant economically in a company with fewer than 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions
- Measures envisaged for to limit dismissals and for facilitate reclassification of the employees concerned.
FYI
All the information communicated to the ESC when the meetings were convened, and the minutes shall be communicated simultaneously to the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
The minutes shall contain the ESC's opinions, suggestions and proposals.
The employer or the administrator informs Dreets of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
Large layoff in a company of 50 or more employees
If at least 10 persons are made redundant economically in a company with at least 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy. However, if an expert is used, a 2e EESC meeting is organized.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The employer or the administrator shall establish a job protection plan (PSE) and shall forward it to the CSE and the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
The PSE shall be transmitted to the Dreets of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
Who shall I contact
The notification be made at the earliest on the day following the scheduled date of the ESC meeting.
The Dreets has a delay of 8 days from the last meeting of the ESC for certify or validate the job-saving plan.
In the event of an unfavorable decision, the ESC shall be consulted within three days. If necessary, the amended document and the EESC opinion are forwarded to Dreets, which takes a decision within 3 days.
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Small redundancy of 2 to 9 employees
The consultation prior to the redundancies provides the EESC with useful information on the proposed collective redundancy. One meeting is mandatory.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The ESC must give its opinion on the proposed dismissal within a maximum period of one month.
After the EESC meeting, the employer or the administrator define the criteria used to determine the order of the redundancies and inform the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) the proposed dismissal.
Large lay-off in a company with less than 50 employees
If at least 10 persons are made redundant economically in a company with fewer than 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions
- Measures envisaged for to limit dismissals and for facilitate reclassification of the employees concerned.
FYI
All the information communicated to the ESC when the meetings were convened, and the minutes shall be communicated simultaneously to the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
The minutes shall contain the ESC's opinions, suggestions and proposals.
The employer or the administrator informs Dreets of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
Large layoff in a company of 50 or more employees
If at least 10 persons are made redundant economically in a company with at least 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy. However, if an expert is used, a 2e EESC meeting is organized.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The employer or the administrator shall establish a job protection plan (PSE) and shall forward it to the CSE and the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
The PSE shall be transmitted to the Dreets of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
Who shall I contact
The notification be made at the earliest on the day following the scheduled date of the ESC meeting.
The Dreets has a delay of 8 days from the last meeting of the ESC for certify or validate the job-saving plan.
In the event of an unfavorable decision, the ESC shall be consulted within three days. If necessary, the amended document and the EESC opinion are forwarded to Dreets, which takes a decision within 3 days.
The administrator address to judge-commissioner an application for authorization of dismissals.
The administrator shall attach the following documents to the application:
- Opinion of the ESCESC : Social and Economic Committee
- Justifications for its claims to facilitate compensation and reclassification of employees
- Decision of the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) in case of job protection plan.
The ordinance given by the judge-commissioner indicates the following information:
- Number of employees whose dismissal is authorized
- Activities concerned
- Occupational categories concerned.
The order is notified ESCESC : Social and Economic Committee or in the absence of an SE to the employee representative.
It shall be forwarded to the following bodies:
- Public Prosecutor
- Administrator
- Judicial agent.
FYI
In the absence of an ESC, the order is forwarded to the employees' representative.
Where the employer intends to dismiss an employee for economic reasons, he must in principle summon the employee to a pre-interview.
During this pre-interview, the employee may be assisted.
In the event of dismissal of at least 10 employees in a company in which there is ESCESC : Social and Economic CommitteeThere is no pre-interview. Exception: one protected employee shall be called for a preliminary interview.
Warning
The employer must offer the employee a professional security contract (CSP), regardless of the size of the company.
The employee shall be informed of his dismissal for economic reasons by registered post with acknowledgement of receipt.
If the employee accepts the professional security contract (CSP), the written statement setting out the cause of the break must be given to the employee during the dismissal procedure and at the latest at the time of acceptance of the CSP.
The letter of termination shall contain the following information:
- Economic reasons (e.g. economic difficulties) and their impact on the employee's employment or employment contract (e.g. job loss)
- Prior efforts of training, adaptation and reclassification of the employee
- Possibility to benefit from a re-hire priority for 1 year from the termination of the employment contract and conditions for its implementation.
A sample letter of economic dismissal is available:
Letter of final economic dismissal - CSP
If the dismissal on economic grounds is notified during the 21-day reflection period to join the CSP, the employer shall:
- Recalls the end date of the reflection period
- Specifies that, in the event of a refusal, this letter constitutes the notification of the dismissal.
This is known as notification of dismissal on a precautionary basis.
A sample letter of economic dismissal sent to conservatory title is available:
Letter of economic dismissal sent on a precautionary basis - CSP
Warning
The 7-day or 15-day periods provided for in the case of economic redundancy shall not apply.
The employment contract is terminated at the end of the notice of dismissal.
If the professional security contract (CSP), the employment contract is terminated at the end of the 21-day reflection period.
In the event of dismissal from 2 to 9 employees, the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) must be informed of the redundancies.
What information is provided to Dreets?
The employer must inform Dreets of the dismissals pronounced, within 8 days of the dismissal letters to the employees concerned.
It shall then communicate the following information:
- Name and address of the company
- Nature of the activity and the number of employees of the company or establishment
- Name(s), first name(s), nationality, date of birth, sex, address, employment and qualification of the dismissed employee(s)
- Date of notification redundancies to the employees concerned.
How does the employer transmit the information to Dreets?
The employer shall inform Dreets of the dismissals of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
Please note
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
During the recovery plan
Where there are substantial possibilities for the company to recover, the court shall put in place a plan for judicial recovery ending the period of observation. This plan is intended to enable the company to continue operating, to maintain jobs and to pay its liabilities.
Step-by-step approach
The procedures for consulting the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) differ according to the number of redundant employees and the size of the company.
There are 2 categories of dismissal:
- Small dismissal: from 2 to 9 employees dismissed irrespective of the size of the company,
- Large layoff: at least 10 employees licensed.
The procedure for large-scale redundancy is differences depending on whether the company's workforce is less than 50 employees or 50 or more employees.
The ESCESC : Social and Economic Committee shall deliver its opinion on the proposed dismissal by working day before the commercial court hearing.
FYI
In the absence of the ESC, the employees' representative shall be consulted instead of the ESC. He shall carry out the tasks of the members of the ESC.
Répondez aux questions successives et les réponses s’afficheront automatiquement
Small redundancy of 2 to 9 employees
The consultation prior to the redundancies provides the EESC with useful information on the proposed collective redundancy. Only one meeting is required.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
Large lay-off in a company with less than 50 employees
If at least 10 persons are made redundant economically in a company with fewer than 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions
- Measures envisaged for to limit dismissals and for facilitate reclassification of the employees concerned.
Large layoff in a company of 50 or more employees
In the context of a redundancy of at least 10 persons in a company of at least 50 employees, the ESCESC : Social and Economic Committee may deliver an opinion after one meeting on the plan for collective redundancy. However, if an expert is used, a second meeting of the ESC is organized.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The employer or the administrator shall establish a job protection plan and shall forward it to the ESC and to the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
Who shall I contact
The Dreets has a delay of 8 days from the last meeting of the ESC to approve or validate the employment protection plan.
In the event of an unfavorable decision, the ESC is consulted within 3 days and, if necessary, the amended document and the ESC opinion are forwarded to Dreets. It shall take a decision within three days.
Vous avez choisi
Choisissez votre cas
Small redundancy of 2 to 9 employees
The consultation prior to the redundancies provides the EESC with useful information on the proposed collective redundancy. Only one meeting is required.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
Large lay-off in a company with less than 50 employees
If at least 10 persons are made redundant economically in a company with fewer than 50 employees, the ESC may issue an opinion after one meeting on the plan for collective redundancy.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions
- Measures envisaged for to limit dismissals and for facilitate reclassification of the employees concerned.
Large layoff in a company of 50 or more employees
In the context of a redundancy of at least 10 persons in a company of at least 50 employees, the ESCESC : Social and Economic Committee may deliver an opinion after one meeting on the plan for collective redundancy. However, if an expert is used, a second meeting of the ESC is organized.
The information transmitted at the ESC with the invitation to attend the meeting shall comprise next items :
- Reasons economic, financial or technical aspects of the redundancy project
- Number of redundancies envisaged
- Occupational categories concerned (e.g. workers, employees and supervisors or managers)
- Criteria proposed for order of dismissals
- Number of employees, permanent or not, employed in the establishment
- Estimated timetable redundancies
- Economic measures envisaged
- Possible consequences of dismissals provided for in health, safety or working conditions.
The employer or the administrator shall establish a job protection plan and shall forward it to the ESC and to the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct).
Who shall I contact
The Dreets has a delay of 8 days from the last meeting of the ESC to approve or validate the employment protection plan.
In the event of an unfavorable decision, the ESC is consulted within 3 days and, if necessary, the amended document and the ESC opinion are forwarded to Dreets. It shall take a decision within three days.
What should the court administrator do?
When the administrator provides for redundancies on economic grounds, attached to the report submitted to the graft (or produced at the hearing) the following documents:
- Opinion of the ESCESC : Social and Economic Committee
- Copy of the letter informing the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) the proposed dismissal.
As soon as the draft plan has been lodged with the Registry, the Registry shall convene the ESC by letter RARRAR : Recommended with notification of receipt.
To whom should the decision be forwarded?
The decision to stop or refuse the plan is notified at the CSE.
It shall also be made known of the Public Prosecutor's Office and legal agents by the Registry, within 8 days of the date of judgment.
When a employment protection plan (ESP) must be done, the administrator sends the PSE to Dreets within 1 month after the judgment.
Who shall I contact
What should the commercial court do?
The plan is decided by the commercial court.
The judgment adopting the plan shall state the following information:
- Number of employees authorized for dismissal
- Activities and relevant professional categories.
FYI
Where the dismissal concerns a protected employee, the intention to break must be expressed within one month of the judgment.
The request for validation of the collective agreement or type-approval of the unilateral document shall be sent to Dreets after the judgment adopting the recovery plan, within one month of the judgment.
The Dreets has a deadline of 8 days upon receipt of the application to approve or validate the job-saving plan.
Where the employer intends to dismiss an employee for economic reasons, he must in principle summon the employee to a pre-interview.
During this pre-interview, the employee may be assisted.
In the event of dismissal of at least 10 employees in a company in which there is ESCESC : Social and Economic CommitteeThere is no pre-interview. Exception: one protected employee shall be called for a preliminary interview.
Warning
The employer must offer the employee a professional security contract (CSP), regardless of the size of the company.
The employee shall be informed of his dismissal for economic reasons by registered post with acknowledgement of receipt.
If the employee accepts the professional security contract (CSP), the written statement setting out the cause of the break must be given to the employee during the dismissal procedure and at the latest at the time of acceptance of the CSP.
The letter of termination shall contain the following information:
- Economic reasons (e.g. economic difficulties) and their impact on the employee's employment or employment contract (e.g. job loss)
- Prior efforts of training, adaptation and reclassification of the employee
- Possibility to benefit from a re-hire priority for 1 year from the termination of the employment contract and conditions for its implementation.
A sample letter of economic dismissal is available:
Letter of final economic dismissal - CSP
If the dismissal on economic grounds is notified during the 21-day reflection period to join the CSP, the employer shall:
- Recalls the end date of the reflection period
- Specifies that, in the event of a refusal, this letter constitutes the notification of the dismissal.
This is known as notification of dismissal on a precautionary basis.
A sample letter of economic dismissal sent to conservatory title is available:
Letter of economic dismissal sent on a precautionary basis - CSP
Warning
The 7-day or 15-day periods provided for in the case of economic redundancy shall not apply.
The employment contract is terminated at the end of the notice of dismissal.
If the professional security contract (CSP), the employment contract is terminated at the end of the 21-day reflection period.
In the event of dismissal from 2 to 9 employees, the DreetsDreets : Regional Directorate for Economic Affairs, Employment, Labor and Solidarity (ex-Direct) must be informed of the redundancies.
What information is provided to Dreets?
The employer must inform Dreets of the dismissals pronounced, within 8 days of the dismissal letters to the employees concerned.
It shall then communicate the following information:
- Name and address of the company
- Nature of the activity and the number of employees of the company or establishment
- Name(s), first name(s), nationality, date of birth, sex, address, employment and qualification of the dismissed employee(s)
- Date of notification redundancies to the employees concerned.
How does the employer transmit the information to Dreets?
The employer shall inform Dreets of the dismissals of dematerialized way on the following website:
Collective breaks in employment contracts portal (RUPCO)
Please note
In case of malfunction of the computerized reporting system, the transmission of information and requests shall take place by any other means (e.g. registered mail).
Who can help me?
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