The Saint-Barthélémy McDonald's restaurant, in the northern districts of Marseille, went through a long and much-discussed dispute between 2018 and 2021. It is of interest here for a technical reason: it shows how the legal structure of franchising determines, in practice, who is answerable for the employees.
The disputed sale
On 14 June 2018, the franchisee, Jean-Pierre Brochiero, confirmed by letter his plan to sell his six McDonald's restaurants in the Bouches-du-Rhône. The employees - 77 in total - saw it as a disguised redundancy plan, since the prospective buyer for Saint-Barthélémy was planning a restaurant outside the McDonald's franchise. The dispute became national news on 7 August 2018, when a union representative at the restaurant barricaded himself in the premises and threatened to set himself on fire.
The employees brought several sets of proceedings. On 7 September 2018, the Marseille Regional Court (TGI) authorised the sale of five of the six restaurants, but refused that of Saint-Barthélémy, the takeover plan being judged too insubstantial.
On 29 November 2018, the same court approved the sale of the other five restaurants to a new franchisee and rejected the fraud argument put forward by the staff representatives, in unambiguous terms: they, the court wrote, “proceed by way of unsupported allegations, maintaining the argument of fraud without demonstrating its reality”. On this ground, the employees' claims were therefore dismissed.
The liquidation, and the mechanism that changes everything
On 13 November 2019, the Commercial Court placed the operating company in receivership. The franchisee described a restaurant that had been heavily loss-making for several years; the employees disputed this assessment - that dispute was not resolved. On 12 December 2019, compulsory liquidation was ordered. Some sixty employees were affected, employed by a company that was now insolvent.
It was then that the most legally interesting decision came. On 19 December 2019, the supervising judge terminated the lease-management agreement (location-gérance) that bound the franchisee to the brand. The business returned to its owner - McDonald's France - and, through the transfer of undertaking provided for in article L. 1224-1 of the Labour Code, the employment contracts followed the business. The employees became employees of McDonald's France.
It is necessary to be precise about what this means, and what it does not mean. This transfer resulted from the end of the lease-management agreement, that is, from a mechanism of insolvency law. It is not a judicial finding of co-employment: no judge has said that McDonald's France was the employer of the franchisee's employees before the termination. The brand became the employer because of the termination, not because it had always been one.
The practical consequence is nonetheless considerable: the financial burden of redeployment and compensation passes from an insolvent franchisee to a solvent company.
What the structure sheds light on
The lease-management agreement is precisely the structure at the heart of the Antibes case file. Bernard Collorafi did not own his businesses: he was their lessee-manager, and it is the Paris Court of Appeal itself that describes him as such in its judgment of 8 March 2000, when it states that the head of a network which caused the lessee-manager's difficulties cannot invoke in bad faith the operation of the termination clause.
The same mechanism produces a symmetrical effect there: termination ends the lease-management agreement, the business returns to the brand, and the operator leaves - without the business, without the premises. This is what is documented, on the Antibes side, by McDonald's letters on the review of the lease-management agreement, then by the liquidation judgments of the Antibes Commercial Court. On the separate question of whether a franchisor can be held to be a joint employer, see our article on co-employment.
What happened next
Once closed, the restaurant was occupied from March 2020 by former employees and associations, and turned during the lockdown into a food aid platform, under the name “L'Après M”. On 9 July 2021, Marseille city council approved the purchase of the site by the City.