Publié le 04/09/2025

French labour law - Nestlé Dismissal - Is the CEO's dismissal for having an undeclared relationship with a subordinate employee valid? Answer: No!

Article juridique - Droit du travail

On September 1, 2025, Nestlé France announced the dismissal of its CEO for having an undeclared relationship with a direct report.

According to the September 2, 2025 edition of Le Monde, an internal investigation was conducted by the Group's Chairman, the lead independent director, and a lawyer. https://www.lemonde.fr/economie/article/2025/09/01/nestle-annonce-le-licenciement-de-son-directeur-general-laurent-freixe-pour-cause-de-relation-avec-une-subordonnee-directe_6638068_3234.html

The internal investigation reportedly concluded that the "undeclared" relationship occurred in violation of Nestlé's Code of Business Conduct. This would have justified the dismissal of the CEO.

Nestlé's Code of Conduct is available online: https://www.nestle.com/sites/default/files/asset-library/documents/library/documents/corporate_governance/code_of_business_conduct_fr.pdf

This dismissal is of concern, given that in a recent decision of the Court of Cassation dated June 4, 2025 (No. 24-14.509), the Court of Cassation considered, on the contrary, that an invasion of an employee's private life rendered the latter's dismissal null and void.

In this decision, the Court of Cassation affirmed that a reason relating to the employee's personal life cannot, in principle, justify disciplinary dismissal, unless it constitutes a breach by the employee of an obligation arising from their employment contract.

1.1 Did the CEO violate Nestlé's Code of Business Conduct?

Nestlé states that this relationship between the CEO and his direct report violates Nestlé's Code of Business Conduct.

This code is signed by Group Chairman Paul Bulcke and Managing Director Laurent Freixe, who became CEO. https://www.nestle.com/sites/default/files/asset-library/documents/library/documents/corporate_governance/code_of_business_conduct_fr.pdf

This code includes provisions relating to conflicts of interest, gifts, entertainment, and hospitality, corruption, fraud prevention, the protection of company assets, insider trading, money laundering, and the financing of terrorism.

The article in the daily newspaper Le Monde indicates that the CEO's relationship with his direct report had not been "declared."

The business code of conduct does not appear to require making such a declaration of "intimate relationship".Licenciement Nestlé - Le licenciement du DG pour avoir eu une relation non déclarée avec une salariée subordonnée, est il valable ? Réponse non !

If the intimate relationship between the CEO and his subordinate created a conflict of interest, it should perhaps have been declared.

1.2 Is Nestlé's internal investigation valid?

First of all, according to the article in Le Monde dated September 2, 2025, the CEO of Nestlé was dismissed following an internal investigation that was managed by the Group Chairman, an independent senior director, and an external lawyer.

We have not read the internal investigation, but one might question its independence, given that the Group Chairman, a signatory to the Code of Conduct, was a party to it.

In this regard, the Defender of Rights, in a framework decision dated February 5, 2025, provided guidelines for managing internal investigations within companies (see our article Discrimination and Harassment at Work: Recommendations from the Defender of Rights on Internal Investigations in Companies https://www.village-justice.com/articles/discriminations-travail-les-recommandations-defenseure-des-droits-sur-les,52510.html?utm_source=backend&utm_medium=RSS_Linkedin&utm_campaign=RSS_Reseaux).

The Defender of Rights states that employers must prioritize investigators trained in discrimination and ensure their impartiality, avoiding entrusting the investigation to a department implicated in the reported incidents.

Therefore, the use of specialized external service providers or training for HR departments becomes essential to ensure a thorough investigation that complies with legal requirements.

Hearings must include all relevant parties, ensuring confidentiality and traceability; otherwise, the company may be exposed to challenges and litigation.

If his dismissal is contested, the CEO could have the internal investigation dismissed, arguing that it was not impartial, and this would invalidate the dismissal.

In this regard, the trial judge assesses the probative value of the internal investigation (Cass. Soc., June 18, 2025, No. 23-19.022 and our article https://www.legavox.fr/blog/frederic-chhum-avocats/enquete-interne-licenciement-suite-harcelement-37460.htm).

3. Nullité d’un licenciement pour un fait qui relève de sa vie privée !

En tout état de cause, le fait d’avoir une relation avec une subordonnée relève de sa vie privée et ne peut pas en soi constituer un motif de licenciement … sauf s’il y a un manquement de l'intéressé à une obligation découlant de son contrat de travail.

We did not have access to the employee's employment contract, and it is difficult for us to make a decision.

Finally, the press release announcing the CEO's dismissal could be considered a harassing act.

It gives this decision worldwide publicity, which further harms the CEO.

This may seem like a warning to other employees in the group.

It should be remembered that one in four people finds their spouse within the company.

It would be a shame if this type of publicity damaged employee relations.

Last but not least, the dismissal press release states that Nestlé thanks the "dismissed CEO" for his work for the group.

This disqualifies the dismissal.

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

www.chhum-avocats.fr