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29 September 2016

France: Entry into force of the Act reforming labour law

Following lengthy debates and extensive campaigning by certain trade unions, the Act ‘on labour, modernisation of social dialogue and safeguarding of career paths’ was enacted on 8 August and published in the French Official Gazette on 9 August. In order for all its provisions to enter into force, this major reform requires the adoption of over 100 decrees.

This Act – which focuses on working time, social dialogue, redundancy on economic grounds and dismissal for unsuitability – contains one particular article that has crystallised the opposition of certain trade unions, and school and university student organisations. This is Article 2, which aims to establish the primacy of company agreements over agreements concluded at branch level in terms of working time. Although the working week remains set at 35 hours, the Act contains numerous flexibility measures, for example an increase in overtime (with a statutory increase of 10 % in the absence of an agreement), the possibility of exceeding the maximum working day (up to a limit of 12 hours) and exemption from the minimum daily rest time.

This major reform of working time is the precursor to a comprehensive rewrite of the Labour Code, which is also set to favour collective bargaining at company level. In addition to reversing the hierarchy of rules, which allows for the decentralisation of collective bargaining, the reform also amends the role of the Act. Instead of setting minimum standards that can be altered only through branch or company agreements, this now contains few guarantees.

The reform has created deep divisions in the trade union world, between the ‘reformist’ trade unions, grouped around the CFDT, and the ‘dissenting’ trade unions, based around the CGT and FO. The CFDT supports the Act because it incorporates one of its demands – also made by the CGT – to safeguard career paths through a new mechanism: the compte personnel d’activité (CPA) or ‘personal work account’. This mechanism enables all the individual’s rights that are transferrable from one employer to another or that can be used in a period of unemployment to be brought together within one account. One significant difference between the two camps is that the CFDT does not in principle oppose the reversal of the hierarchy of rules, unlike the CGT and FO, which consider that a lower-level rule can only improve the content of a higher-level rule and not the reverse. In addition, the trade unions opposed to the reform fear that the primacy given to company agreements will encourage employers to exert pressure on employees and their representatives to accept a downgrade in their working conditions in return for keeping a site or production line in operation.

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