France: Labor Reform Gathers Steam Among Lawmakers

Re-Blogged From Worldview.Stratfor.com

The French government has the backing to potentially pass a broad labor reform package. During a press conference Aug. 31, French officials presented details on labor reform, including five “ordinances” (legislative acts similar to presidential decrees). French President Emmanuel Macron promised during his campaign to restore France’s reputation as a European power at the same level as Germany. These pro-business measures aim to increase France’s competitiveness and to help the second-largest EU economy.

The labor reform initiative proposes to give more flexibility to enterprises and aims to reduce unemployment from 9.4 percent to 7 percent by the end of the current legislature and presidency in 2022. The proposed reform includes changes to workers’ representation and contracts. Negotiation of salaries will take place at the enterprise level, instead of the sector level. French businesses would also be able to fire workers based on their economic impact domestically rather than internationally.

The labor reform initiative has France’s powerful trade unions divided in their response. The hard-line General Confederation of Labor (CGT) publicly voiced its disapproval and scheduled a strike for Sept. 12. Other trade unions have adopted a wait-and-see approach. Meanwhile, the Unsubmissive France party has promised a separate demonstration on Sept. 23, but members of the center-right Republican Party, along with employers’ associations, support the reforms.

Despite rancor from trade unions, the French government expects to approve the labor reform by Sept. 25. The parliament will still have to vote to ratify the law, but Macron controls a comfortable majority in the French parliament, and the opposition to the government is weak and divided. However, the decreasing popularity of the French government could encourage different sectors of the society to become more vocal in their protest of against Macron’s sweeping reform agenda.

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