France faces new challenges – Labor Reforms
France has been experiencing a massive wave of strikes and demonstrations since May 2016.
In order to understand the current context, it is necessary to take a look back as the foundation of the French welfare state was gained through struggles.
It began in 1919 in the metallurgical sector, continued in 1920 with the railway and mines workers, along with several other sectors among which the clothing sector, followed by one of the largest factory lockouts organized by thousands of workers in 1936 after the election of the Popular Front (Front populaire), which led to the introduction of paid vacations and an average raise of 20 % of the remunerations.
May 1968 is certainly also one of the biggest social movements France has had to face by its magnitude and consequences: it led to a political, social, and cultural shift.
All of the strikes mentioned above started from the Public sector and spread into the private sector: more than a social struggle, these movements are also a political challenge and the unions / associations / NGO involved are usually fighting against a government and, but not necessarily, against a reform or action.
French people are also very committed to the welfare state and they consider somehow it is immutable. Our welfare state is however not sustainable: during the Trente Glorieuses, or Glorious Thirty – a period between 1945 and 1975 where France experienced rapid expansion -, the country could face the social expenses as the unemployment rate was very low, a massive number of employees could contribute to the social security system and the balance between the retired and the active employees was good.
This is nowadays not the case: the current unemployment rate is around 10.2 % after several years of high unemployment, the social security deficit is alarming and the imbalance between active / retired workers makes it worse.
Since 2008, France has been slowly going in the right direction with several Labor reforms which cannot be considered politically oriented, but are mainly common-sense actions.
More recently, François Hollande has raised the fight against unemployment as a matter of national emergency and passed several reforms this summer without difficulties, until the new Labor law Reform called “Loi El Khomri”, from the name of the new Labor Minister, which is today strongly challenged.
This law is however nothing but the continuation of the reforms of 2008, 2009, 2013 and 2015: it gives more power to the unions within the Firms, allowing them to be flexible and adapt to the activity of the Firm, and it makes the dismissal for economic reasons easier. On the other hand, it gives more guarantee of the security of the agreements and more security to the employees regarding the balance between their working / personal life.
Hence, the main provisions of the new Labor Reform to come are:
- The possibility for the Union’s representative within the Firm or other bargaining actors to negotiate some provisions, which were until now only dedicated to the Union’s representatives within the sector (ex : SYNTEC, Metallurgie, Immobilier etc), among which the working time : the overtime payment could le a 10 % increase, whereas it used to be 25 % if no Sector agreement provides with a lower %; the maximum working time can be fixed to 12 hours per day in case of an emergency, 46 hours per week on a 12 week cycle, and an increase of working time during 3 years can be provided (before the reform it was a 1 year maximum),
- A new definition of the economic difficulties to secure the dismissal for economic reasons (which definition was built by the judges and was very insecure),
- More flexibility to prevent the economic difficulties through new kind of agreements with the Unions,
- An indicative cap of indemnities before the Labor Court: the judges could condemn employer on this basis but please note that is not mandatory at all.
On the other hand, the Labor reform provides with several advantages for employees:
- The provisions of the daily flat rate agreement are reinforced to protect employees,
- The sanctions of illegal work are strengthened,
- Proof of harassment becomes easier for the employees,
- A right to disconnect is enacted and would be determined by a collective agreement.
Then how this reform could have led to a massive protest and several strikes that are about to paralyze the whole country?
Several explanations could be given, however a major lack of communication and explanation on the government’s part regarding the law is primarily to blame. This has allowed opponents of the reform to successfully convince 70 % of the population that it is an important threat to their current working conditions. The loss of control of one of the oldest unions (CGT), which is seizing the opportunity to make a strong comeback and the run-up to the next presidential elections due in 2017, is also to blame for this situation.
Now that the French Government has pushed the Bill through, it will be discussed in Parliament, be it through an emergency procedure. A vote on the Bill is expected at the end of June, but it will likely be a watered down version and even though it will be modest, no government will dare to return to this issue.