Monday, 23 May 2016

Getting Political Again: The Loi du Travail

Much of the French news over the past few months has been dominated by the Loi du travail or the Loi El Khomri, the controversial new employment law that has brought demonstrators to the streets in a way that I don't remember happening since 2006. Even in the French media, much of the coverage has been about the demonstrations, and I've noticed that among my non-French (largely anglophone) friends, Facebook comments and dinner party conversations on the subject mainly focus on the burning cars and the sirens wailing into the night, with political commentary limited to "the French economy is tanking and unemployment is too high, so people just need to suck this up if France is ever going to survive in a globalised world."

A few years ago, my reaction would probably have been the same, but a combination of eight years in France and what I've seen happening in other more economically liberal societies has led me to a better understanding of the other side of the argument. I'm not saying I agree with all the trade unions' demands, and I believe as strongly as anyone (91% of the French population) the casseurs who take advantage of every demonstration to spread violence and vandalism need to be stopped immediately, but in the interests of a balanced perspective, here is my understanding of some of the arguments against the law:

- The law aims to make it easier to fire employees for economic reasons. Companies have to show that they have been making a loss for a certain period of time (which depends on the size of the company) before they are allowed to do this, and this period of time is to be reduced. Certainly, the fact that it is difficult to get rid of employees is often cited as a reason why employers are reluctant to take on new workers. However, easy hiring and firing does not necessarily lead to a strong economy in the long term. The reason for this is that over the last few decades, shareholders have gained more and more control over the decisions that are taken about how companies are run compared to other stakeholders, such as managers and employees (who also have an interest in the wellbeing of the company, as their jobs depend on it). Easy trading of shares means that shareholders are massively more interested in making a quick profit than in the long-term wellbeing of the company. This means it is less likely that they will vote in favour of measures such as training and improved procedures which lead to a real increase in productivity ("good" capitalism) and more likely to approve measures which increase profit in the short term.* So laws which make it easier to get rid of people do not necessarily improve the state of the economy in the long term.

- It will be harder to take an employer to tribunal for unfair dismissal. Many people claim that in France there are far too many people who know that they are unsackable and therefore take the mickey by staying in comfortably in their jobs and doing the bare minimum. However, it is a little known fact that France, with all its workers' rights and people who have been put in a cupboard instead of fired, has a higher productivity (measured in terms of GDP per hour worked) than both the UK and the US.

- A contract issued by an employer can override the convention collective (collective bargaining agreement) agreed by the trade unions for different employment sectors. This is one of the most controversial aspects of the law, and it's easy to see why. While it might accord certain employers with specific or unusual needs more flexibility, its also a massive undermining of the trade unions. Given that employers can already offer employees different conditions as long as they are not deemed to be less advantageous than the conditions in the convention collective, this part of the law opens the way for a race to the bottom in terms of working conditions. And when I hear about things like the UK's much-debated zero hours contracts or this story about US poultry farm workers having to wear nappies because they aren't given toilet breaks, I'm glad to live in a country which has higher standards.

- The restrictions on the hours that employees can be asked to work will be less severe, meaning that people can be expected to spend a longer time at work over a given period, and they will work more hours before this is considered as overtime. But it's another misconception about France, largely caused by the 35 hour week, that French people work fewer hours than people in other western countries. This article explains that France works only slightly below the Eurozone average hours per week ... and the countries where people work fewer hours include Germany, Europe's golden child of economics. And even if it were true, why would people who already have jobs working longer hours be a solution to the country's unemployment woes?

(According to the BBC article, countries with lower unemployment also often have a high number of part-timers. At least in the UK, part-timers are often parents (usually mothers) of young and not-so-young children, whereas in France, childcare is cheaper and the school day is more conducive to parents working - which it wouldn't be if people were expected to work more hours on a week-by-week basis. Couple this with the aforementioned zero hours contracts and people being told by Jobcentres to become self-employed doing jobs where it isn't possible for them to make a decent living, and the statistics elsewhere start to look a little less rosy .)

- Finally, foreigners are often surprised that even young people are demonstrating against the law, given that youth unemployment is so high. I suspect that there is an element of lycée strikes being a rite of passage for the students, and I do wonder how many have really reflected on both sides of the issue, but I guess that those who have would argue that they are taking a long-term view. In your twenties, it's easy to put in the long hours and work harder than everyone else to avoid being first in line for a licenciement économique, but when you are older and have other responsibilities (children or ageing parents, for example) it's not so easy. It's also a lot harder to find another job as you get older, particularly for people in their late forties and fifties, who are often seen by recruiters as being over the hill despite the fact that they have ten or twenty years ahead of them before retirement.

So there you go. As I said, I don't agree with all of the demonstrators' claims, but I do think that if you're going to live and work in a country and enjoy the benefits that it brings (hello job security and RTT days!) you should at least accept that these have often been hard-won and understand that privileges usually demand that a sacrifice is made somewhere.

I learned this from Ha Joon Chang's 23 Things They Don't Tell You About Capitalism, which is a surprisingly easy read for someone with interest in but very little knowledge of economics (like me!).


  1. As a former demonstrator, I can definitely attest that lycée strikes are a rite of passage. However, many foreign observers would be surprise to learn that such strikes are taken very seriously by teens and young adults, i.e. you don't just skip class and have fun, you participate to the political discussion. Of course, you don't always have the full picture at 16 or 18... but that's another matter!

  2. Thanks for this post. I have been looking for someone to explain what were the proposed changes and why people objected to them. You would be surprised how many new services obscure this information. No one seemed capable of providing a list of changes.