French President Emanuel Macron’s first big test as a leader will come as labor unions have called on protests in the region.
The government has introduced a new policy that seeks to restructure the nation’s rigid labor code.
Macron as well as Labor Minister Muriel Penicaud held meetings with France’s unions and business organizations before restructuring the labor code. It was their goal to find a common ground between the two parties. Macron has said that he wants to allow individual companies negotiate wages rather than be subject to industrywide agreements. The plan caps dismissal awards and allow workplace referendums. Employers will also be given more freedom to negotiate directly with employees on a number of issues.
The French unemployment rate as of May 2017 is 9.6%. The Labor Code runs over 3,000 pages and has been described as indecipherable in parts. 170 pages of the rules deal with firing employees, 420 pages deal with health and security regulations. 85 pages tackle collective negotiations and 50 pages are dedicated to temporary work. Employers in the nation have often complained that these rules make it harder for them to hire new employees since it is expensive. It is also difficult (and expensive) to fire employees.
Macron has positioned himself pro-business and campaigned on the promise of restructuring the code.
Previous attempts at overhauling the labor code have failed. The powerful unions have taken to the streets and some of the protests have even turned violent. However, Macron has remained steady in his conviction to move forward with his plans.
Macron recently said that he was determined and unyielding. He struck a defiant note stating, “France is not a country which is open to reforms. France does not reform... because we rebel, we resist, we circumvent. This is what we are like. I will be absolutely determined and I will not yield anything, either to the lazy, the cynics or the extreme. And I ask you to have the same determination, each day.”
He has also added that France was in need of a “profound transformation,” including the labor sector. Macron has promised that his policy would be implemented “without brutality, calmly, with reason and sense.”
Opposition has criticized him for referring to the protestors as “lazy.” Philippe Martinez, the chief of the CGT trade union, has warned that the protests would continue unless the government calls off the reforms. He said, “We will fight until the end to make sure these decrees don’t pass.” The CGT union has announced 180 protests and 4,000 individual strike actions will be taking place on September 12, 2017.
However, Macron’s government has been making steady progress on this front. Force Ouvriere and the CFDT, which are two of the biggest trade unions in France, have indicated that they will not be joining the protests. They have announced their intent to negotiate with the government.
Our assessment is that Macron will likely succeed in implementing his new policy if he is willing to make key concessions to trade unions. He has remained steadfast in pushing his agenda despite a drop in his approval rating and has shown that he will not be intimidated.