Precisions in applicable law to international employment contracts

International mobility and workforce flexibility are central to business success but create legal challenges, notably in immigration, social security, taxation and contractual certainty. A key issue is to determine in advance which law governs an employment contract where work has an international dimension.

Legal framework: Rome Convention and Rome I

Within the EEA, Regulation (EC) No 593/2008 ("Rome I") sets out uniform conflict of laws rules for contractual obligations. When a private law dispute involves more than one country, Rome I identifies the national law governing the contract, enhancing legal certainty and predictability in cross border transactions.

Rome I succeeded the 1980 Rome Convention ("Rome Convention"), which still applies to contracts concluded until 17 December 2009. Both instruments are built around two main pillars:

1. Party autonomy - Article 3 (Rome Convention and Rome I) allows parties, within limits, to choose the governing law, provided the choice is express or clearly demonstrated by the contract or surrounding circumstances.

2. Objective connecting factors - Where no valid choice exists, the applicable law is designated by factors such as habitual place of performance and special rules for particular contracts (including employment).

Rome I and the Rome Convention temper party autonomy through protective rules for weaker parties, notably individual employees (Article 8 Rome I and article 6 in the Rome Convention). 

In respect of individual employment contracts, it recognises the freedom to choose the applicable law, but provides that such choice must not result in depriving the worker of the protection of mandatory provisions of the law that would govern in the absence of choice, determined by objective criteria such as the habitual place of work, place of business that engaged the worker, or the country with the closest connection to ensure adequate protection. Please note the habitual place of work is to be interpreted broadly and based on a functional/content assessment rather than only a physical presence (CJEU, C-29/10, Koelzsch) and Courts must assess the whole relationship over time, especially where the habitual place of work shifts or work is performed in multiple States (CJEU, C-485/24, Locatrans).

Courts must therefore balance freedom of contract with the need to apply the law of the country most closely connected with the employment relationship, aiming at "adequate" rather than automatically "maximal" protection for the worker.

Recent evolution - the Hortis judgment

In C 768/24 (9 July 2026 - Hortis), the CJEU examined how a contractual choice of law clause in an international employment contract interacts with mandatory protective rules under the Rome Convention and, by extension, Rome I. The central message is that a choice of law clause alone is insufficient: the objectively established facts of the employment relationship ultimately decide which law prevails. 

Facts and questions in Hortis

Hortis, a Swiss IT services company, employed JA as a director from 1 September 2007. JA resided and worked in France, while the contract was governed by Swiss law. On 25 January 2012, JA was dismissed according to Swiss rules, which do not require a pre dismissal interview or reasons in the dismissal letter. JA challenged the dismissal before French courts.

The Paris Court of Appeal held that French law applied, emphasising France as the place where the work was performed, and granted JA the benefit of mandatory French rules on pre dismissal interviews and motivation of dismissal.

Before the Court of Cassation, the employer argued that the Court of Appeal should have examined whether the contract was more closely connected with Switzerland. It relied on elements such as: salary paid in Swiss francs into a Swiss bank account; affiliation to Swiss social security schemes; a favourable Swiss linked tax regime; and a Swiss email address and mobile phone number.

The Court of Cassation asked the CJEU whether, in an employment contract with a chosen applicable law, the national court must ignore more protective mandatory provisions of another law if the contract is more closely connected to the chosen law, and whether, in determining that closest connection, it should factor in or disregard links arising from the choice of law itself.

Effect of the chosen law 

The CJEU confirms that the objective criteria in Article 6 of the Rome Convention remain relevant even when a law has been chosen; the Court notes that the same logic is reflected in Article 8 Rome I. These criteria identify the law whose mandatory provisions the worker may invoke, but they are subject to the "closest connection" corrector, which may point to another country's law.

Hortis clarifies that this "other country" may be the same country whose law the parties have chosen. Thus, where all circumstances show that the contract is more closely connected to the country of the chosen law, the national court must give precedence to that law and set aside more protective mandatory provisions of the law that would otherwise apply under Article 6 Rome Convention.

In Hortis, this means Swiss law could prevail over French mandatory rules, but only if the referring court finds that the contract is more closely linked to Switzerland than to France. The CJEU's answer does not create automatic primacy for the chosen law; it merely allows that law to prevail where the country of the chosen law is also the country with the closest overall connection, in line with the earlier Schlecker judgment (C 64/12).

Worker protection: "adequate" not "most favourable"

The judgment clarifies the notion of worker protection under Article 6 Rome Convention: its objective is to ensure adequate protection for the employee as the weaker party, but this does not mean that courts must always apply the law that is materially most favourable to the worker.

Instead, the aim is to apply the law of the country with which the contract has the closest connection. Adequate protection is understood as applying the law that best reflects the real employment relationship, rather than engaging in an automatic search for the most advantageous law for the worker.

In Hortis, the French rules invoked by the employee were more protective than the Swiss dismissal rules. The Court nonetheless accepts that those French rules may be disregarded if a global assessment of the circumstances shows a closer connection with Switzerland.

Elements to be taken into account - and the role of the choice of law

National courts must conduct a holistic assessment of all elements characterising the employment relationship. Relevant factors include:

• the country where the employee pays tax on employment income;

• the country of social security affiliation;

• applicable pension, health and invalidity schemes;

• pay setting parameters and other working conditions.

The specific contribution of Hortis lies in a refinement: elements that arise, in the performance of the contract, as consequences of the chosen law may also be taken into account, provided they are objective features of the employment relationship.

At the same time, the Court introduces an important safeguard. Judges must guard against employers "instrumentalising" connecting criteria. They should examine whether the links relied upon result from a genuinely shared agreement or have been unilaterally imposed on the worker.

In Hortis, it is for the referring court to decide whether the objective elements cited in favour of Switzerland -- remuneration, tax treatment, social security affiliation and other conditions of execution -- support a finding that the relationship is more closely connected with Switzerland than with France.

Hence, if, after a full analysis, French law is the law applicable in the absence of a choice, the employee may rely on its more protective mandatory rules notwithstanding the chosen Swiss law; if, on the contrary, Swiss law is also the law applicable in the absence of a choice, the French mandatory rules on dismissal cannot be introduced via the protective mechanism of the Rome Convention / Rome I Regulation.

Practical consequences and conclusion

Although Rome I did not apply ratione temporis in Hortis, the CJEU emphasises that Rome I mirrors the structure and reasoning of the Rome Convention, so the judgment's teachings are directly transposable to contracts concluded today.

Hortis falls within the established case law (Koelzsch, Schlecker, Locatrans) interpreting Article 6 of the Rome Convention. For international employers, Hortis confirms that a choice of law clause alone does not secure application of the chosen law. The law chosen by the parties may prevail over more protective mandatory provisions invoked by the worker only where all the circumstances show that the contract is more closely connected with the country of the chosen law. 

As a result an employer wishing to rely only on the chosen law must develop practical habits to (i) choose upfront a governing law consistent with how and where the work is actually performed, (ii) continuously monitor the relationship's cross border elements as they evolve, and (iii) be able to show that key international connections were not unilaterally imposed by the employer.

In practical terms, Hortis confirms that, in international employment contracts, a thorough upfront analysis is advised.