French President Wants To Reform Labour Market

Emmanuel Macron on Tuesday got down to the nitty-gritty of running the country, with a marathon discussion on the reform on which he has staked his reputation: the labor market.

The new French president had a meeting scheduled every hour from 9 a.m. to 7 p.m. with trade union chiefs and business leaders to show both his stamina and his determination to pass this reform as soon as possible — if, that is, he can count on a majority to discuss it after the June parliamentary elections.

This is the reform Macron wants to pass first, and fast. It is also the one that, should he fail, would trip his presidency before the end of the year.

The 39-year-old president wants to convince the main stakeholders — employers and workers — on the substance of the reform and the way he has chosen to go about it: an accelerated procedure that will shorten the lengthy parliamentary debates.

Macron’s plan is to convince and divide.

Employers eagerly anticipate what they consider long-overdue changes in the way working regulations are implemented in France, while most trade unions have warned they will oppose Macron’s plans just as they opposed similar reforms that his predecessor François Hollande tried to push through last year.

Macron’s plan is to convince and divide. He wants to spare no time explaining that the aim of his reform — a wide decentralization of collective bargaining to individual company level — is to make French businesses, notably small and mid-size firms, more agile and adaptable so that they can create more jobs.

If implemented, the reform would nudge labor relations in France closer to the German or Scandinavian model. Unions would have more latitude to strike deals on work time and pay within companies or even individual work sites. This would give firms more flexibility than the current system, which forces them to abide by sector-wide agreements that are difficult to adapt.

The French leader will suggest to unions that he might be open to amendments and suggestions — but within limits, as Macron has always insisted he would implement his detailed presidential platform “without hesitation” and would not be “deterred by any obstacles.”

Divide and reform

Macron is counting on divisions within the labor movement. France’s most influential union, the CFDT, is an overall supporter of decentralizing labor relations. This reformist union would be ready to support Macron if the government is open to its suggestions. CFDT is up in arms, for example, about a planned cap on damages for workers deemed unfairly dismissed by the courts.

A government adviser acknowledged that everything would be done to soothe CFDT’s concerns. “We have made sure we’ve kept some concessions in store for them,” he said.

“It depends on what exceptions they add into the rule,” said one union leader who is generally favorable to reform, though he is still unsure about Macron’s real intentions.

The concessions might not be granted on the reform Macron wants to see through this summer, but on others he plans for later this year regarding unemployment benefits and the management of the welfare system, another source said.

France’s new prime minister, Edouard Philippe, insisted earlier this week that like any good reform, this one would be “well thought, well discussed and well executed.” But discussions, he added, would only aim at “enriching and explaining” the current plan.

“Then, once the discussion has taken place, we must act fast,” he warned.

 “Fast” will mean, as Macron said in the campaign, using a procedure known as “ordinances” whereby the government can pass laws without a parliamentary debate. Union leaders have already warned they would consider this “undemocratic.” Ordinances “are totally unacceptable,” said Philippe Martinez, leader of the communist-dominated CGT union.

Government aides noted, however, that ordinances can only be taken once parliament has voted to authorize the procedure and limit the scope and time-span for the government to act.

Macron’s problem, however, is that opposition to his labor reform is not limited to the unions …

“There will be a vote beforehand, and afterward because the ordinances must be ratified,” said one aide. “We just want to avoid the long amendment procedure, and back-and-forth between the two houses of parliament.”

Macron’s problem, however, is that opposition to his labor reform is not limited to the unions that might stage the sort of demonstrations that helped derail most of Hollande’s plans last year.

With the May presidential election and the parliamentary vote in June, France has been in campaign mode for more than nine months. Political passions are high, and both the far right and the far left — whose candidates Marine Le Pen and Jean-Luc Mélenchon together polled 41 percent of the votes in the first round of the presidential election — have threatened to send their sympathizers into the streets to derail Macron’s reform.

Contrary to Hollande’s approach, Macron made it clear during the campaign what his intentions were and got a mandate to implement that platform. If his La République en Marche (LRM) wins a majority in parliament in two weeks’ time, he will use it as further proof that he is entitled to go ahead.

Mélenchon, who is running for a seat in Marseille, returned to Paris this week to campaign for his party’s candidate running in the capital against Myriam El Khomri, who as Hollande’s labor minister steered his half-baked reform through parliament last year. LRM is not fielding a candidate against her — a sign that Macron thinks his former cabinet colleague’s efforts, however incomplete, went in the right direction.

Macron’s tactical plan seems quite simple: clinch a deal with CFDT to ensure it remains at worst neutral, and face down possible demonstrations as the determined reformer whose policies are shaped by the ballot box, not by the street. Passing that crucial test would give him more assurance that he can push further on the reform path.