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Redeployment for companies controlled by the same individual

Published on : 20/04/2026 20 April Apr 04 2026
Newsletter / Recent Case Law
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Does the control of several companies by the same individual constitute a ‘redployment group’ within the meaning of Article L.1233-4 of the Labor Code? In its decision of 11 February 2026, the Court of Cassation answered this question in an affirmative way (Cass. Soc., 11 February 2026, No. 24-18.886)

Scope of the redeployment obligation

Pursuant to Article L.1233-4 of the Labor Code, "the dismissal of an employee on economic grounds may only take place once all training and adaptation efforts have been made and the redeployment of the employee concerned cannot be achieved in available posts, situated within the national territory in the company or in other companies of the group to which the company belongs and whose organisation, activities or place of operation ensure the transfer of all or part of the workforce”, it being specified that ‘the term “group” refers to the group comprising a company known as the parent company and the companies it controls under the conditions defined in Article L. 233-1, in Sections I and II of Article L. 233-3 and in Article L. 233-16 of the Commercial Code.’

In the case leading to the decision handed down by the Court of Cassation on 11 February, an employee challenged the validity of his dismissal on economic grounds, on the basis that his employer had failed to fulfil its obligation to redeploy him internally. He therefore considered that the search for internal redeployment positions should have been conducted not only within the employing company, but also within another company managed by the same individual.

Concept of a controlling company

In order to conclude that the company had fulfilled its obligation to redeploy the employee and to dismiss the employee’s claims in this respect, the Chambéry Court of Appeal had held that the existence of a group necessarily implied that one company, as a legal entity, exercised a controlling influence over another.

Noting in this case that whilst both concerned companies had the same director, the second company was not a shareholder of the employer company, it concluded that the two companies “did not form a group within the meaning of the aforementioned provisions and the applicable case law”.

Case of companies controlled by the individual

This is not the position finally adopted by the Court of Cassation, which points out that, pursuant to Article L.233-3(I)(1) of the Commercial Code, ‘any person, whether a natural or legal person, is deemed, for the purposes of Sections 2 and 4 of this Chapter, to control another where they hold, directly or indirectly, a share of the capital conferring a majority of the voting rights at general meetings of that company’. It concludes that a group may be characterised as such where the companies in question are controlled by the same natural person, even in the absence of a capital link or dominant influence between those companies. Noting in the present case that the director of both companies, ‘the manager of the company in which he was the majority shareholder, directly held 70% of the capital of company B, of which he was chairman’, it concludes that “the conditions for effective control set out in Article L.233-3-1 of the Commercial Code were met between these companies” and that efforts to find a new position should have been made not only within the employing company, but also within the second company owned by the said director.
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