European Trade Union Institute, ETUI.

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Labour market reforms in France: background summary

A controversial reform

  • On 24 March 2016 a controversial reform bill on labour law was adopted by the French cabinet (Conseil des ministres). The text completely redrafts the section of the Labour Code dealing with working time, according a much more important role to company-level agreements. The draft law represents the first stage in the reform of the Labour Code scheduled for completion in 2018.
  • The bill provides also for a ‘company referendum’ that would enable collective agreements to be directly endorsed by the workforce; in addition, it contains new features affecting the rules on employer representativeness, redundancy measures and occupational medicine.

Trade union positions

  • The bill as initially drafted contained a large number of provisions that were unacceptable to the trade unions. The new version presented to the Council of Ministers had the support of the so-called ‘reformist’ trade unions (CFT, CFE-CGC, CFTC, Unsa). However, the trade unions confederations CGT, FO, FSU and Solidaires, as well as three student organisations, remain dissatisfied with the text and are demanding its withdrawal.

Elements of the new reforms

  • This is the first fundamental reform of French labour law; it is intended to lead, by 2018, to a new Labour Code consisting of three sections:
    • fundamental rights guaranteed to all;
    • provisions laid down in sectoral or company-level agreements, the scope of which is to be enlarged;
    • rules applicable in cases where no agreement exists.
  • Contrary to some neighbouring countries, France had not hitherto embarked on such a broad general reform of its labour law. And yet, since the turn of the millennium, its labour law has been subject, by stages, to quite radical change.
  • At the level of collective labour relations, the decentralisation of collective bargaining, which is further extended by the current draft law, has been a reality since 2004 when the company-level agreement was allowed to include provisions, on all but a specific set of matters, that were different from, and even less favourable than, those laid down by a higher-level agreement. Since 2013 companies have also been allowed to conclude ‘job preservation agreements’ which erode employees’ existing gains. Any employees who refuse the new working conditions will be dismissed.
  • Another important phase was the reform of trade union representativeness in 2008. This put an end to the irrebuttable presumption of the representativeness enjoyed by the five trade union confederations that had been recognised under the law since the end of World War II. According to the terms of the 2008 reform, their representativeness became dependent principally on the results of the workplace elections. In order to be recognised at sectoral level, a trade union must have gained 8% of the votes. At company level, the threshold was raised to 10%. Trade unions failing to reach these thresholds are subsequently excluded from the collective bargaining process.
  • The thresholds also allow determination of whether or not a collective agreement gains sufficient trade union signatures to come into force (it must be signed by one or more trade unions representing at least 30% of the votes) or to be described as a majority agreement (the signatures must then represent at least 50% of the votes), this latter condition being a prerequisite for some agreements where there is provision for waiving of a higher standard. On the other hand, non-signatory trade unions representing more than 50% of the votes may block implementation of the agreement.
  • This reform leads to a trade union reconfiguration insofar as the smallest organisations will be pushed out of the collective bargaining or may form trade union coalitions for the purpose of reaching the 30% or 50% thresholds. At company level, in terms of restructuring, a law of 2013 also made it easier for employers to impose collective redundancies.
  • Finally, a reform of the social dialogue, introduced in 2015, altered the system of worker representation by facilitating the merger of different forms of staff representative institutions in companies with less than 300 employees. It also rationalised the amount of collective bargaining that employers are required to conduct, for example on matters such as wages or equality in the workplace.
  • In the area of individual labour law, dismissals have already been made easier by the creation in 2008 of the ‘broken agreement’ arrangement which allows an employer to get rid of a worker on a voluntary basis. The employer thus circumvents the need for labour tribunal proceedings and the employee is not deprived of his/her entitlement to unemployment benefit as would be the case had s/he chosen to resign.
  • At the same time, the reforms have served to consolidate certain new rights. The reform of vocational training requires ‘career development talks’ to take place between the employer and each worker in order to assess training needs; it also introduces a personal training account for each worker on the basis of which the employee builds up a ‘training entitlement’ expressed in hours. The latest pensions reform adopted in 2014 also introduced the unpleasant work account which enables account to be taken of factors such as night work or exposure to noise by the allocation of points that then allow workers to reduce their working time, undertake training, or bring forward their retirement. This set of rights can be transferred from one employer to another and is intended to enhance workers’ security through their working life as a whole. As from 2017 these rights will be incorporated into a new mechanism known as the personal work account, the principle of which was adopted in 2015.
  • To these changes must be added other related reforms on the operation of the labour inspectorate (2014), vocational training (2014), financing of the social dialogue and transparency of the works committee accounts (2014), occupational medicine (2015) and labour jurisdictions (2015).

Conclusion

  • France has thus, over the last fifteen years, introduced radical changes into its labour law by means of a series of legislative measures that were adopted after consultation with the social partners or on the basis of the content of collective agreements negotiated at cross-industry level by the social partners. The latest reform is thus one more component of this protracted process of reform. It takes even further the liberal rationale which, in the view of some trade union and student organisations, is not offset by the provision of increased security for workers.