Macron’s labour reforms are a major test for France’s trade unions

President Macron’s extensive labour reforms are part of a programme of state-led liberalization which will shift the balance of power towards employers and test trade union strength and unity

Heather Connolly

It is difficult to overestimate the significance of the current labour reforms in France, for employers, workers and their representatives. The Government seems fully aware of the significance and the potential for extensive opposition and has chosen to push legislation through by decree, avoiding parliamentary debates and votes.

The proposed reforms are wide-ranging and include broader social reforms (in the area of unemployment insurance, pensions and training) to come in the following 12 months. The labour reforms have been a priority for the new President, Emmanuel Macron and go much further than the El Khomri law of 2016, that I discussed in an earlier blog. The most significant reforms for trade union practice are: the merging of representation structures from three statutory bodies representing workers to a single body; expanding the number of issues that can be agreed at company level and that supersede sectoral level agreements; and the ability of small companies to by-pass negotiating with trade unions or nominated representatives in favour of conducting a ballot of employees directly on a number of significant issues.

In terms of work, the reforms include changing  the nature of permanent contracts to introduce the non-permanent permanent contract, the CDI ‘de chantier’ or ‘de projet’, which allows employers to employ workers on permanent contracts (CDI) but only for the time needed to complete a particular project. The reforms also include changes to make it easier for employers to make workers redundant in the case of poor company performance at a national level (as it stands, companies find it difficult to make workers redundant if a multinational company is in profit at the multinational level), less constraints on employers wishing to make collective redundancies, and upper limits for pay outs from industrial tribunals.

All of this (and there is more), of course, works in the interest of employers (and the state), allowing them to budget more effectively for pay outs from industrial tribunals, for example, and use labour more flexibly by employing workers on ‘bogus’ permanent contracts and sacking workers with less constraint. There are measures which arguably work in favour of employees, such as the possibility to work more flexibly, from home for example (le télétravail) and having individual training accounts. However, much of the discourse around flexibility tends to blur the fact that overall there will be a fundamental shift in the balance of power from labour to capital and the measures will undoubtedly lead to increased economic insecurity for many employees.

France is often accused of failing to adapt to the realities of globalisation and to hampering job creation and growth by having such ‘rigid’ labour protections. The reforms of the labour code are intended to continue a process that has been taking place over the last few years of loosening up the labour market and reducing employee protection, with the intended outcome being the creation of new jobs. Job creation is held up as the answer for achieving economic growth, but with little attention paid to the types of jobs that will be created as a result of loosening up the labour market and the ((un)intended) social costs that creating more precarious jobs and with it greater economic insecurity has on society more widely. Flexible employment policies are often balanced in favour of employers and encourage a ‘disposable labour model’ which is heralded as the answer to solving productivity problems and economic growth.

As I argued in an earlier blog, French governments of various colours hold up the UK as an example of a flexible labour market model that France should seek to emulate. It is worth repeating that the UK is hardly a model that France would want to follow, considering the high levels of income inequality and the proliferation of precarious work in the form of zero-hours contracts, for example. Some argue that the reforms are designed to bring the French system closer to a Scandinavian-style ‘flexi-security’ model but from a close look at the reforms the changes are heavily weighted towards the flexibilisation of work, but without any additional securities for workers. The reforms increase the discretion of employers and are evidence of state-led liberalization of industrial relations in France.

There are of course social costs attached to high levels of unemployment and particularly for young workers who find it difficult to enter the core of permanent, protected workers. This is a problem in France, with a 9.6 per cent unemployment rate almost double that of the UK and Germany, and nearly 22 per cent youth unemployment. The question remains whether the answer is to increase economic insecurity and make everyone more precarious in the process of trying to solve the unemployment problem.

This blog draws on my British Academy funded research examining the possible futures of trade unions in Europe in the context of growing numbers joining the precarious workforce. Trade unions often struggle to access and represent precarious workers, and in countries where there are low levels of employment protection these workers are even more exposed and more likely to be outside regulated spaces.

So how have the French trade unions responded to the reforms? For a start the major confederations have not taken a unified stance in response, with the more radical trade unions (Confédération générale du travail – CGT and Solidaires) staging a number of strikes and demonstrations against the reforms. The more ‘reformist’, and largest trade union confederation in France, the Confédération française démocratique du travail (CFDT) hasn’t joined the strikes to date, which has made the trade unions look weaker and perhaps encouraged the Government to push through the reforms by decree. In fact, the CFDT has put in place training sessions for their activists on how to apply the reforms in the workplace, which sets out clearly its pragmatic response.

There have been three days of strike action since September and the number of strikers and demonstrators has dwindled with each action. Recently, however, the third largest confederation, Force Ouvrière (FO), joined the action alongside education trade unions and students that is planned for 16 November 2017. It remains to be seen whether a stronger and more unified response will emerge as the reforms become reality (some of which already have) and touch wider forms of social protection. Trade unions in France have traditionally been able to halt or amend reforms through mass mobilisation and protest including the watering down of the El Khomri laws in 2016.

The financial resources from union membership fees is low (membership levels are less than 10 per cent of the French workforce) and the changes being made to the workplace representation structure will impact the institutional resources of trade unions (in terms of the time paid for by employers to carry out representational duties). It is through representational structures that much of the class consciousness raising and identity work of trade unions is carried out.

If the trade unions are unable to amend or halt these reforms they will need to find renewed ways of demonstrating their relevance and maintaining a multi-level power base in French society.

This post was originally blogged by SPERI on the 13th November 2017.

Heather Connolly is Associate Professor of Employment Relations at the University of Leicester, and co-founder of CERCnet. This blog was written as part of her British Academy mid-career fellowship ”Trade Union Futures: Representing Precarious Workers in Europe’.

Resisting Labour Reforms in France

Heather Connolly

On 4th November 2015, France’s labour minister, Myriam El Khomri, launched reforms designed to rewrite the labour code. France’s labour code is more than 3,500 pages long in its latest edition, plus vast amounts of supplementary case law. This fact makes it difficult for most people to make sense of and keep track of current legislation and hence to understand what is actually being reformed. Against a background marked by a high level of unemployment of around 10 per cent, and particularly high levels of youth unemployment, the two main objectives were to revise the entire labour code and to give company-level agreements a central role.

 

In a nutshell, El Khomri proposed a labour code with a new architecture resting on three tiers and centred on collective bargaining at the branch and company level. The first tier guarantees fundamental principles such as the minimum wage and working hours (the well-known 35-hour week) from which employers would not be able to depart. The second tier comprises areas open to negotiation, at branch or company level. The third tier covers the provisions applicable where there is no branch or company level agreement between employers and unions.

 

Earlier this year, on 24th March, the Council of Ministers adopted a revised version of El Khomri’s Bill. As a result of earlier protests the government has somewhat watered down the proposals to the extent that business leaders now see the law as irrelevant because the original intention – to allow small businesses to make deals directly with workers, rather than unions – has been removed in the revised version of the law. MEDEF, representing mainly large employers, was unhappy with changes introduced in the new version of the bill, while CGPME and UPA, organisations representing small and medium-sized enterprises (SMEs), felt disadvantaged by new rules that offer greater flexibility to large companies than to SMEs through social dialogue. On the union side, the reformist unions (CFDT, CFTC, CFE-CGC, UNSA) noted improvements that brought the proposed changes more in line with their preferences. But other unions (CGT, FO, SUD) and student organisations have continued to demand the withdrawal of the proposals. Nevertheless, the government has presented the bill to parliament for debate with a view to its adoption in summer.

 

As France experiences more industrial action this month, notably during the run up to Euro 2016, it is important to reflect on what the labour reforms signify and why the new law has caused such widespread action and disruption. The new law was intended to start the same process that has long been under way in France’s neighbours, notably Germany and the UK, loosening up the labour market and reducing employee protection, but in turn creating new jobs. France is often accused of failing to adapt to the realities of globalisation and to hampering job creation and growth by having such ‘rigid’ labour protections.

 

However, job creation is held up as being the Holy Grail to achieving growth, but with little attention paid to the types of jobs that would be created as a result of loosening up the labour market and the ((un)intended) social costs that creating more precarious jobs has on society more widely. The UK is hardly a model that France would want to follow, considering the high levels of income inequality and the proliferation of precarious work in the form of zero-hours contracts, for example. Is Germany the model to follow, again with its (often underestimated) high levels of income inequality and low-paying service sector jobs? Indeed it was only in 2014 that Germany introduced a minimum wage to redress the high disparity in incomes and precariousness in parts of the labour market, particularly in the service sector. There are of course social costs attached to high levels of unemployment and particularly for young workers who find it difficult to enter the core of permanent, protected workers. The question is whether the answer is to make everyone more precarious.

 

Trade union radicalism and mobilisation has been a significant feature of the labour movement in France. While in general there has been a decline of strikes in France, there has been a persistence of resistance and protest. However, most of the current protests are about demands to open up negotiation and social dialogue rather than more radical demands. Recently, the usual suspects in transport have been at the centre of strikes and mobilisations against labour reforms, including a railways strike lasting 10 days from 1st June and workers on the underground beginning an open-ended strike on 10th June. The three main unions representing rail workers – the more radical CGT, UNSA and SUD-rail – have engaged in several bouts of strike action and encouraged open-ended strikes. The CFDT union has cancelled some more recent calls to strike after succeeding in gaining guarantees from the government. The motivation for the most recent walk-out is in part due to opposition to France’s labour reforms – however rail workers have also organised the strike to put pressure on SNCF bosses as negotiations continue over their pay, working conditions and working hours.

 

Over the last fifteen years, France has introduced radical changes into its labour law. The latest reform is thus one more component of this protracted process of reform. It takes even further the liberal rationale of greater flexibility in the labour market which, in the view of some trade union and student organisations, is not offset by the provision of increased security for workers.

 

French union activists have been described as ‘reactionary radicals’ – reactionary because union activists are attempting to prevent a change from taking place, and radical because they aspire to a type of far-reaching change that would foster a balance of power more favourable to labour, neutralise the neo-liberal project, and allow for the continuation of the sociocultural world of public sector workers.

 

However, much of the protests and strikes since the onset of the economic crisis in 2008 have been guided by a defensive rather than offensive agenda centred on the defence of employment benefits, the acquis sociaux (acquired rights), and the status quo. The most recent strikes reflect not only continuity of reactionary radicalism and defending hard-won rights, but an expression of the relationship of subordination between workers and their employers and the shift in the balance of power towards employers, which has notably taken place under a Socialist government.

 

The current strikes are therefore a test of strength for the French trade union movement and their ability to resist reforms. Similarly, the reforms are also a test for the French government. The outcomes arising from the industrial action will be watched closely by employers, big and small, and will demonstrate the government’s commitment to reform of the labour laws.

This post was originally posted on the SPERI blog, University of Sheffield, 16th June 2016.