An employee enters into several fixed-term contracts (fixed-term contracts) with a business. Following a disagreement, the parties sign a settlement protocol ending the dispute. A few years later, the employee is rehired on a fixed-term contract in the same business.

He brought an action before the labor court and obtained the reclassification of his fixed-term contracts as permanent contracts (CDI) but only from the first contract after the transaction. He appealed to the Court of Appeal to have his very first contract, concluded before the settlement, taken into account.

The Court of Appeal dismissed the employee's claims. In the context of contracts concluded with business, the court states that the reclassification of fixed-term contracts into permanent contracts is not possible for contracts concluded before the transaction. The employee refers the matter to the Court of Cassation.

The Court of Cassation rejects the employee's claims. It recalls the principle that when a fixed-term contract is reclassified as a permanent contract, the employee is considered to have been on a permanent contract since the very first contract.

However, the principle therefore changes:

• that a transaction has taken place at the mid-point and that the parties declare that they are ‘fully satisfied with their rights’;
• that the employee has not performed any work for the business for 5 years.

In this sense, the reclassification as a permanent contract takes effect from the first contract concluded after the transaction.