French Conseil d’Etat Ruled on Income Tax Exemption in Compromise Agreements further to Constructive Dismissals

Where employer and employee enter into a compromise agreement further to constructive dismissal, income tax will not be levied on the settlement, provided the employee can show that the employer had, de facto, dismissed him unfairly (prise d’acte assimilable à licenciement sans cause réelle et sérieuse – Conseil d’Etat, April 1st 2015 n° 365253).