On 21 January 2025, the Court of Cassation handed down its decision in the so-called ’France Télécom case’ (now Orange), upholding the decisions of the courts before it and introducing a new concept of ‘institutional psychological harassment’.  

Following a series of suicides, a trade union condemned the company’s reorganisation policy which, in its view, amounted to psychological harassment. This assessment was confirmed by the criminal court and Paris Court of Appeal. Following this complaint, the company and several of its senior executives were prosecuted for harassment. This decision was appealed before the French Supreme Court on the basis that there was no definition under French law that covered the offences in question.   

The French Supreme Court upheld the rulings of the criminal court and Paris Court of Appeal by recognising the concept of ’Institutional psychological harassment’. This is defined as follows: “Acts establishing and implementing a company policy aimed at structuring the work of all or part of a group of employees, and which, by their repetition […] potentially or actually worsen the working conditions of that group and which exceed the limits of management authority”. 

This means that directors, senior managers, and employees can now be personally liable for decisions that result in harassment, even when the facts do not arise from their individual relationships with employees, but rather result from a company policy that they have designed and implemented.

Faced with this development, companies will of course remain free to determine their strategy and continue to be able to reorganise their workforce, which might include downsizing. The key difference is that the measures implemented must now not fall within the scope of a “company policy knowingly leading to a deterioration in employees’ working conditions”. 

This recognition of ‘institutional psychological harassment’ will now require companies and managers to exercise increased vigilance, proactively implement proportionate prevention measures and raise awareness among all stakeholders. This will inevitably have an impact on ongoing cases before the French Labour Courts in which harassment is alleged.