Government unveils labour reforms

President Emmanuel Macron's government was locked in weeks of talks with unions before it revealed its plans to reform France's labrythine labour laws

Changes will be made by executive order, while only one union has so far called on its members to strike amid wide-ranging acceptance of the need to reform the 'Code du Travail'

The government has unveiled plans to overhaul France's labour laws following weeks of negotiations.

Measures, including a cap on payouts for unfair dismissals and greater freedom to hire and fire were revealed on Thursday. The plans also give companies more flexibility to adapt pay and working hours to market conditions.

The key points of the reforms are:

Greater emphasis on in-house labour talks
Workers and employers would be able to negotiate agreements on a firm-by-firm basis.

Changes to short-term 'CDD' contracts
Currently, CDDs can be renewed a maximum of two times before an employee must be offered a permanent 'CDI' contract or let go. The plans will allow individual industries to set their own minimum duration and renewal terms for short-term contracts.

Narrower company rules on redundancies
In France, any plan to lay off multiple workers must be approved by a chamber of commerce. In the past, a judge could block plans if a company's global operations were profitable. Under the reforms, judges can only examine the firm’s performance in France when deciding whether to approve layoff proposals.

A cap on wrongful dismissal payouts
In the event of wrongful dismissal, firms will have to pay damages according to a set scale starting at three months’ salary for every two years of employment up to a maximum of 20 months' pay for 30 years' employment. Until now the minimum pay-out for two years' employment has been six months' salary, while nominal guidelines set on an industry-by-industry basis have been frequently ignored, leading to massive payouts in some cases.

Relieving bureaucratic pressure on companies with more than 50 employees
Currently, growing companies must comply with a list of additional and costly requirements, including setting up a works council, appointing workers' representatives, and forming a health and safety committee as soon as they hire a 50th employee. These will be streamlined under the reforms.

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The reforms will be implemented by executive order, meaning the government will avoid a lengthy parliamentary debate. The changes will be adopted this month and must then be ratified by parliament, where President Emmanuel Macron's La République en Marche party has a large majority.

Prime Minister Edouard Philippe described the plans as 'ambitious, balanced and fair' but accepted not everyone would support the changes.

Protests against the plan have been called on September 12, but only the CGT has called on its members to join the movement. Secretary-general Philippe Martinez said: "All our fears have been confirmed and the additional fear is obvious and has been written: It’s the end of the working contract.”

Meanwhile, Jean-Luc Mélenchon, the far-left leader of France Insoumise, is organising a separate protest on September 23.

But support for the marches may be limited. A major part of Mr Macron's campaign during the Presidential elections focused on employment reforms - and there have been no surprises in the final document. An opinion poll on Wednesday showed that nine out of 10 French people agreed that labour code had to be reformed, although 60% admitted they were worried about Mr Macron's plan.

Meanwhile, unions praised the government's negotiation strategy and welcomed the summer of talks. The FO's Jean-Claude Mailly said that while the reforms were far from perfect, the government had carried out 'real consultation' and said he would not call on his members to join the strike.

The CFDT said its members would not take to the streets, but added it was ultimately disappointed that its position was not reflected in the final text.

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