'France faces last chance to reform labour market, but must not become like UK and US'

Ben McPartland
Ben McPartland - [email protected]
'France faces last chance to reform labour market, but must not become like UK and US'
Photo: AFP

The head of France's biggest employers federation said on Friday that President Emmanuel Macron represented the last chance to reform the country's rigid labour market, but did not want the country to end up like the US or the UK.


The French president Emmanuel Macron has already done the easy part.

In one year he’s gone from being a former banker dismissed as a "chancer" and a "maverick" to France's head of state in his new home at the Elysée Palace, and the head of a party with an imposing majority in the French parliament.

His next task however is considered to be far harder: reforming the notoriously rigid French labour market.

Macron believes that the key to tackling France's stubbornly high unemployment of close to 10 percent is injecting flexibility into the country's rigid labour code -- at the risk of sparking mass worker protests.

While his plans have leftist trade unions seething and warning of mass street protests, the leaders of France’s big companies are unsurprisingly right behind him.

“We need to get going quickly,” said Pierre Gattaz, president of France’s employers federation Medef, an organisation that is reviled by many among France's hard left.

(Pierre Gattaz - right - leaving the Elysée Palace after talks with Macron. AFP)

“France won’t have another opportunity. Now we have no option,” Gattaz told members of the Anglo-American Press Association in Paris including The Local.

“The whole world, the business leaders in America, the UK, China, Africa say France must carry out reforms, the biggest priority being reforming the labour market," Gattaz said.

Gattaz and his fellow business chiefs at Medef are pleased with Macron's economic programme, albeit, they would have preferred it if the conservative candidate François Fillon, dubbed France's Maggie Thatcher due to his promise to impose liveral reforms and cut public spending, hadn't been crippled by a fake jobs scandal.

Macron's government wants to give bosses more power to negotiate conditions with workers at the company level and also wants to cap the severance pay awarded by labour courts.

But a similar law passed by the Socialist government in which Macron served sparked months of sometimes violent protests and sporadic strikes, during which uncollected rubbish piled up on the streets of Paris.


The president risks more controversy by wanting to fast-track the reforms through parliament using executive orders, a move Gattaz is fully behind.

To get trade unions on board, the government launched negotiations within days of Macron's election, which are set to continue throughout the summer.

But he will have little breathing room.

Much of the resistance towards the previous government’s labour law reforms stemmed from fears over the loss of workers’ rights with laws relaxed to make it easier to lay off staff and the power of France’s trade unions undermined.

Although the IMF said the reforms didn’t go far enough many of those who were against it feared it was a step towards a liberalized labour market along the lines of the US or the UK, home to the famous zero hours contracts.

Gattaz said he didn’t see the ultra-liberalised US, UK model as the right one for France.

“It’s too far from the French culture,” he told The Local and other members of the Anglo-American Press Association in Paris.

“Maybe France will get there in 20 or 30 years time,” Gattaz said. “But I don’t think it’s the right model."

He believes France should aim for a “midway point” that ensures “flexibility and security” along the lines of the Danish model.

He wants France to develop a “profoundly humane” model that promotes a “sense of work” and “motivation” among French employees.

But Gattaz said the French needed to learn they their jobs couldn’t be guaranteed for life.

“They need to take into account that if the company needs to adapt then sometimes they are forced to leave that company.

“But that it won't be a tragedy because their training and their experience means they can bounce back quickly.”

While the bosses leader believes the UK model is perhaps too flexible and does not provide enough security he did argue the benefits to workers of having the kind of low unemployment rate seen in Britain in recent years.

“When you have a labour market that is blocked like that in France where there is 10 percent unemployment the balance of power favours companies," he said.

"But when you have a labour market with three percent unemployment like in London then it’s the workers who have the power. Because the worker can decide to quit their job if they don’t like it and find another one the next morning.”

But many French workers will need convincing and most analysts expect there to be months of protests ahead.

The defeated presidential candidate Jean-Luc Melenchon, head of the hard left France Insoumise (France Unbowed) party has positioned himself as the defacto leader of the opposition to Macron’s promised labour reforms.

Gattaz compared Mélénchon to the former Venezuelan leader Hugo Chavez who “left his country” in ruins.

But the bosses federation chief did warn that Mélénchon and France’s other big anti-establishment figure could threaten power in the next presidential election if Macron does not ensure there’s more flexibility in France’s labour market.

“If there are no reforms then in 2022 then we will have Marine Le Pen and Mélénchon in the second round of the election,” he said.








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