Law n°2021-1774 of December 24th, 2021, known as the Rixain law, aims to remedy inequalities between women and men, in particular by providing for obligations of balanced representation in management positions in large companies.
In the Q&A published on April 29th, 2022, the Ministry of Labor clarifies this obligation further (Questions-answers “Balanced female/male representation in management positions in large companies”, April 29, 2022, Ministry of Labor) [1].
On the Rixain law, you can read our article Equality between women and men: what is provided for in the Rixain law proposal aimed at accelerating economic and professional equality.
We will deal successively with:
The scope of the balanced representation obligation (1);
Senior executives (cadres dirigeants) affected by the obligation: exclusion of employees from the daily package (2);
Publication and transmission of discrepancies (3).
1) The scope of the obligation of balanced representation of senior executives.
As a reminder, from March 1, 2022, in companies which, for the third consecutive financial year, employ at least a thousand employees, the employer must publish each year any differences in representation between women and men among senior executives at meaning of Article L3111-2 of the Labor Code on the one hand, and the members of the governing bodies defined in Article L23-12-1 of the Commercial Code on the other [2].
The reference period over which companies must calculate their possible differences in representation is the period of 12 consecutive months corresponding to the accounting year.
1.1) Hypothesis of a merger-reunion.
Note that in the case of a merger-reunion, the company (A) is merged into a new legal entity (B).
Thus, company (A) no longer has legal personality from the effective date of the merger.
Consequently, the workforce of 1,000 employees for three consecutive financial years, conditioning the subjection of the company to the obligation of balanced distribution between women and men among senior executives and members of governing bodies, is assessed on the basis of from the creation of the new legal entity.
1.2) Hypothesis of a merger-absorption.
In the case of a merger-absorption, i.e. in the case where the absorbing company existed before the merger operation, the workforce threshold of 1,000 employees for three consecutive financial years is assessed with regard to the acquiring company, and not of the absorbed company or companies.
The Ministry of Labor specifies that with regard to senior executives, the obligation to achieve a quantified objective applies to civil companies but not to economic interest groups (GIE) which do not have legal personality and therefore cannot be sanctioned.
With regard to members of governing bodies, neither civil companies nor EIGs are subject to the obligation to achieve a quantified objective for this population.
1.3) What is a governing body?
Article 14 of the law of December 24, 2021 introducing the definition of the governing body in article L23-12-1 of the Commercial Code, thus specifies that
"is considered as a governing body any body set up within the company, by any act or any corporate practice, for the purpose of regularly assisting the bodies responsible for general management in the exercise of their missions".
However, the Ministry of Labor specifies that by this definition, the legislator intended to target, for all the possible social forms for commercial companies, the social bodies and other bodies responsible for contributing to the decision-making process concerning management and most strategic management strategies for a company.
1.4) Management committee or executive committee in SAS.
By way of illustration, in a public limited company, the committee set up, if necessary, by the General Management in order to assist it regularly in the exercise of its general missions, as referred to in Article L22- 10-10 of the Commercial Code for public limited companies, which can be named in different ways, this name can be that of “management committee” or “executive committee”.
2) Executives concerned by the obligation: employees on flat-rate days are excluded.
The question was asked whether employees who meet all the criteria of the Labor Code but who are on a daily basis can be considered as senior executives, for the calculation of the differences in representation.
2.1) Which executives are concerned?
The Ministry of Labor replies that article L1142-11 of the Labor Code expressly targets “senior executives within the meaning of article L3111-2 of this code”.
However, article L3111-2 specifies that senior executives are not subject to the provisions of titles II and III of this book devoted to working time, rest and leave.
The provisions relating to flat rate agreements (including the flat rate in days) are found in Title II and are therefore not applicable to senior executives.
In addition, consistent case law from the social chamber of the Court of Cassation recalls that the choice of a flat-rate agreement in days excludes qualification as a senior executive [3] without it being necessary to verify the effectiveness of the criteria provided for by article L3111-2.
As a result, employees on fixed-rate days should not be included in the calculation of gender representation gaps among senior executives.
2.2) What if a person is a member of several governing bodies?
At the same time, when a person is a member of several governing bodies within the company, they are counted only once.
Indeed, the obligation of balanced distribution of women and men among the members of the governing bodies concerns all of these bodies which constitute a single whole.
In addition, the members of the governing body of a company subject to the obligation to calculate the differences in representation, who also have an employment contract or a mandate in another company, are taken into account in the calculation of the differences in representation of the subject company, even if they are legally attached to another entity.
3) Publication and transmission.
The Ministry of Labor specifies that, on a transitional basis, for the year 2022, the publication of representation differences must take place no later than September 1 in a visible and legible manner on the company's website.
From 2023, it must be carried out each year no later than March 1.
Once published, the pay gaps can be consulted until the publication of the following year as specified in article D1142-16 of the Labor Code.
In addition, the law of December 24, 2021 provides for an obligation to transmit to the administration and to the CSE in three stages [4]:
From 2022, companies must submit their differences in representation, as well as the procedures for publishing these differences;
As of March 1, 2026, in addition to the above-mentioned data, the corrective measures adopted, if any, must be transmitted;
As of March 1, 2029, in addition to the above-mentioned data, the progress objectives and the procedures for publishing these objectives and the corrective measures adopted if necessary must be transmitted.
Finally, when the differences cannot be calculated, the employer is not subject to the publication obligation.
However, he must provide the administration and the CSE with the details explaining the reason why these differences could not be calculated.
The differences in the representation of women and men among senior managers are incalculable when there is no senior manager within the meaning of article L3111-2 of the Labor Code or when there is only one.
The differences in representation of women and men among the members of the governing bodies are incalculable when there is no governing body corresponding to the definition of article L23-12-1 of the Commercial Code in the company.
On the gender equality index, find our articles:
. Gender equality: companies with more than 250 employees must publish their index on September 1, 2019!
. Gender equality: details on the index provided by the decree of April 29, 2019
. Equal pay for women and men: how to calculate the index?
. Gender equality: why is the index a biased tool?
. Gender equality: what does the Rixain bill provide for accelerating economic and professional equality?
. Senior executives, gender equality: what changes with the Rixain law of December 24, 2021
. Gender equality index: the decree of February 25, 2022 specifies the corrective measures and the progress objectives.
On executives, find our articles:
. "False" senior executives: a HRD obtains the nullity of her status as a senior executive
. Do you speak senior executive?
. "False" executives: a hotel manager obtains the nullity of his executive status and 105,000 euros in overtime.
Frédéric CHHUM avocat et ancien membre du conseil de l’ordre des avocats de Paris (mandat 2019-2021)
CHHUM AVOCATS (Paris, Nantes, Lille)
e-mail: chhum@chhum-avocats.com
https://www.instagram.com/fredericchhum/?hl=fr
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