Employment law
Leave and year-end shutdowns
The employer may impose the shutdown, but early notice and the handling of short leave balances decide what it costs.
Many companies close over the year-end holidays. It is a legitimate practice, and the law permits it: the employer may require all staff to take their paid leave simultaneously during a shutdown of the establishment.
But this option has two blind spots that prove expensive when discovered in December: late notice, and employees whose leave balance does not cover the period. This article addresses both.
1. What the employer may decide
Shutting the establishment is an organisational decision. It carries three consequences:
| Decision | Scope |
|---|---|
| Requiring leave to be taken simultaneously | The employee's individual agreement is not needed |
| Splitting the main leave period | Nor is agreement needed where the leave falls during the shutdown |
| Setting the dates | Within the three-month shift the Code allows for bringing forward or postponing leave |
One reservation, however: unless the collective agreement provides otherwise. Some agreements frame shutdowns, require consultation or set a notice period. It is the first document to consult. Labour Code, Article L.150 (French).
2. The duty to give early notice
This is where most of the risk sits. Informing employees late does not make the shutdown irregular, but it changes its cost: an employee who has already used up their leave days, for want of being told, may claim compensation for the shutdown period.
The logic is simple: an employee cannot be criticised for having taken leave during the year if they did not know a shutdown was planned.
In practice, three measures suffice to make the operation secure:
- announce the shutdown dates at the start of the year, or at the latest several months ahead;
- write the principle of the annual shutdown into the internal rules, under the technical organisation of work;
- recall the constraint whenever leave is approved during the year, so everyone retains the balance needed.
3. Employees with an insufficient balance
This is the most frequent difficulty: a recently hired employee, or one back from a long absence, has not accrued enough days to cover the shutdown.
The principle is that shutdown days are not paid beyond accrued leave, unless the shutdown exceeds the statutory length of annual leave. Several solutions exist, and they are better settled before December:
| Solution | What it requires |
|---|---|
| Leave in advance | Granting days not yet accrued, regularised later |
| Unpaid absence | Agreed in writing, with the payroll treatment clearly stated |
| Assignment to a maintained task | Where some services remain open during the shutdown |
| Time recovery | As permitted by the collective agreement and the working-time arrangements |
Whichever solution is chosen, it is formalised in writing, employee by employee. A general rule announced orally in a meeting is not enough to support a deduction on a payslip.
4. What a company agreement may provide
A company or sector agreement may set specific rules: maximum length of the shutdown, notice period, treatment of insufficient balances, maintenance of a skeleton service.
Where shutdowns are a recurring practice, formalising these rules once and for all avoids replaying the same discussion every year, and makes the decision unassailable.
5. The checklist, to run at the start of the year
- Does the collective agreement frame establishment shutdowns?
- Have the dates been fixed and communicated to all staff?
- Does the principle appear in the internal rules?
- Have projected leave balances at 31 December been forecast, employee by employee?
- Have cases of insufficient balance been identified and the chosen solution formalised?
- Is a skeleton service needed, and who provides it?
On the general regime of paid leave, see Paid leave.
Key takeaways
| The rule | What it implies |
|---|---|
| A shutdown may be imposed | Individual agreement is not required, even where leave is split |
| Unless the collective agreement provides otherwise | The first document to consult |
| Late notice is expensive | An employee who has used up their leave may claim compensation |
| Unaccrued days are not paid | Unless the shutdown exceeds the statutory leave length |
| Every insufficient balance is handled in writing | Advance leave, unpaid, assignment or time recovery |
| A company agreement stabilises the practice | It avoids replaying the discussion each year |