This belief, which disregards the sovereignty of the Monegasque State, is not based on any legal provision or jurisprudential principle.
Indeed, according to Article 11 of Law No. 739 of 16 March 1963, “the minimum amounts of salaries, bonuses, allowances of any kind, and increases other than those provided for by legislative provisions relating to working hours” shall be “at least equal to those applied under the regulations or collective agreements, for identical working conditions, in the same professions, trades, or industries of the neighboring economic region.”
This leads to several essential observations:
The Reference to “French Regulations and Collective Agreements” Stems from a Monegasque Law
The application of French provisions in Monegasque law does not constitute an infringement of the Principality’s sovereignty, when such application is expressly provided for by Monegasque law and is carried out under the conditions determined by Monegasque law. This is precisely the case with Article 11 of Law No. 739, provided that the conditions it sets forth are met.
The Reference to “French Regulations and Collective Agreements” is Subject to Several Mandatory Conditions
The reference to French legal and contractual provisions may only occur, under Monegasque law, in the presence of “identical working conditions.” The identity of working conditions must be assessed on several aspects (notably organizational, taking into account possible differences in terms of working time arrangements, but also economic, from the perspective of any state aid granted on either side of the border). Failing this, the so-called “principle of salary parity” with the neighboring economic region does not apply.
Moreover, even in the case of identical working conditions, the application of French legal and contractual provisions—by virtue of Article 11 of Law No. 739—is strictly regulated. It is limited exclusively to “the minimum amounts of salaries, bonuses, allowances of any kind, and increases other than those provided for by legislative provisions relating to working hours”—it being understood that case law deduces from the scope of the law (which concerns salary) that only “elements of remuneration for work” directly resulting from the performance of work are concerned, excluding any other type of bonus or allowance.
The Pitfall of Voluntary Application of French Collective Provisions
Unknowingly or unintentionally, an employer may find themselves in a situation that obliges them to apply standards to which Monegasque law does not otherwise bind them: if elements indicate that the employer intends to voluntarily apply a French collective agreement, it will become binding, even in the absence of identical working conditions with the neighboring economic region.
Any reference to a French collective agreement within company documentation must therefore be made with caution, and in any case with full awareness of the implications such a reference may have on the employer’s obligations towards their employees.
