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Talks begin over key labour market reforms

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Talks begin over key labour market reforms
The French government hope talks will lead to reforms of the labour market. Photo: AFP
11:24 CEST+02:00
French unions and business leaders entered into what are expected to be fraught negotiations on Thursday to try to thrash out a deal that could see key changes to France's rigid labour market.

The French government will be holding its breath over the coming days and weeks in the hope unions and employers’ organisations can reach a deal to reform a key aspect of the labour market, that it believes is hampering growth.

On the table are what are known as staff thresholds or “seuil sociaux”.

These require companies who have more than a certain amount of staff to be subject to certain regulations. For example companies with more than 49 on their payroll are forced to offer union representation and set up a worker’s council, known as a committee d’entreprise.

Other regulations kick-in depending on the size of the workforce.

Critics of the thresholds, which include the socialist government, point to the fact that they prevent many companies from expanding.

For example there are said to be two and half times as many companies with 49 staff as with 50.

The government want the thresholds raised to a much higher level, which they believe will boost recruitment at a time when the country is hit by record unemployment.

France’s leading employers association Medef will lead the negotiations. It claims that between 50,000 and 100,000 jobs can created if the thresholds are raised.

Supporters of the rules, mainly the trade unions say they are necessary to enforce “social dialogue” between employees and bosses. They reject the idea they act as a brake on recruitment.

The beleaguered French government, under pressure to fix the economy, will be watching closely and has threatened to legislate if a deal cannot be reached.

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